AKA Energy Group Plans to Spend Nearly $100 Million on Growing Natural Gas Production

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Researched by Industrial Info Resources (Sugar Land, Texas)--AKA Energy Group LLC (Durango, Colorado), an energy group developed by the Southern Ute Indian Tribe, is planning to spend approximately $100 million to upgrade several natural gas processing plants and develop several new natural gas processing fields over the next year.

AKA Energy plans to install a new vapor recovery unit (VRU) system at its Maljamar gas plant near Maljamar, New Mexico. Also at the existing 60 million-cubic-foot-per-day (mmcfd) plant, AKA intends either to install a new acid gas injection system or to construct a new sulfur recovery unit (SRU). The decision to go with a new SRU in place of an acid gas injection system could be because of the change in the marketplace regarding the price of sulfur. In the recent past, sulfur was seen as a not-so-welcome byproduct. Now, a ton of sulfur is fetching a price of $500. Whichever plan AKA Energy chooses, construction will not begin until 2009 for both the VRU system and the sulfur project. During 2008, the Maljamar plant will also undergo a maintenance turnaround during the third quarter.

In Texas, AKA Energy is constructing a natural gas gathering field with a central compressor station and a 16-mile, 8-inch-diameter pipeline to deliver the natural gas to a new natural gas processing plant near Canadian, Texas. The new processing plant will have an initial natural gas processing capacity of 20 mmcfd with NGL production facilities. The central field compressor station will utilize three new Caterpillar (NYSE:CAT) (Peoria, Illinois) 3516 engine-driven compressor packages. The natural gas production field and processing plant should come into service in early 2009.

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