Plains All American to Invest $120 Million to Increase NGL Production in Eagle Ford Shale

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Written by Edward Weatherly for Industrial Info Resources (Sugar Land, Texas)--Plains All American Pipeline (NYSE: PAA) (Houston, Texas) announced that it will construct new natural gas fractionation and stabilization facilities to expand the production of natural gas liquids (NGLs) in the Eagle Ford area of South Texas. The new fractionator will have a capacity for as much as 15,000 barrels per day (BBL/d) of Y-Grade and off-spec Y-Grade NGLs.

The new fractionator already is financially supported by long-term, third-party commitments, and will source the natural gas feed from Plains All American's South Texas Gathering System. It will be built near Gardendale in La Salle County, Texas.

The scope of the project will include the NGL fractionator, a third 40,000-BBL/d condensate stabilization facility, and 80,000 barrels of pressurized storage capacity to accommodate the new production.

Plains All American will need to expand rail capacity, truck loading and unloading facilities to help transport the feedstocks and move the new IRS-grade LE propane, butane and IS-grade natural gasoline production to central collection points.

When the $120 million expansion project is completed in the late second half of 2015, it will increase the total site production and logistics capacity to 120,000 BBL/d. Plains All American did not specify whether it would need to increase its existing fleet of more than 5,400 railcars or its trucking fleet. The trucking fleet includes more than 800 vehicles directly employed by the company, including more than 1,500 trailers to support the La Salle expansion project.

The Eagle Ford area has become an attractive shale-structured formation for investment by many companies due to its prolific production rates, existing infrastructure and a workforce experienced in the construction and operation of hydrocarbon assets.

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