Editorial comment
Over the past few decades, natural gas has become an increasingly popular fuel source, and a vital global commodity. Clean burning and efficient, and in plentiful supply from resources all over the world, production of natural gas has increased considerably, bringing about extraordinary technological developments in the area of extraction, as well as more sophisticated processing methods.
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International natural gas markets have undergone, and are still experiencing, changes in structure and organisation, as well as in supply and demand, in order to fulfill global energy requirements. While exciting and dynamic gas projects are under development all over the globe, two areas enduring particularly rapid expansion are, somewhat predictably, the US and the Middle East.
The US gas processing market has been witness to several notable project advancements over the past few months. In May, MarkWest Energy Partners began operations at its Hidalgo complex in the Delaware Basin. Impressively, the 200 million ft3/d cryogenic processing facility, in Culberson County, Texas, ran at approximately 60% utilisation less than two weeks after beginning operations. A month on, in late June, Enterprise Products Partners announced plans to construct a new 300 million ft3/d cryogenic processing facility to facilitate continued production growth, again in the Delaware Basin (beginning service in 2Q18). Along with the company's South Eddy facility, which began operations earlier this year, and its joint venture plant at Waha, expected to begin service in 3Q16, the new projects are projected to increase Enterprise’s processing capacity in the basin to 800 million ft3/d, from 40?million?ft3/d in 2012 – a huge feat.
Later, in mid-July, Enable Midstream Partners’ 200 million ft3/d Bradley II plant in Grady County, Oklahoma, became fully operational, further enhancing the company’s gas gathering and processing capabilities in the SCOOP and STACK plays. It is the ninth processing plant to be connected to the company’s super-header processing system, a 1.7 billion ft3/d capacity pipeline network. Simultaneously, ARM Energy and HPS Investment Partners reported that Kingfisher Midstream had officially begun full operation of its Lincoln plant in Oklahoma. Phase one of the project features a state of the art, 60?million ft3/d cryogenic processing plant, and associated infrastructure, while phase two boasts an additional 200 million ft3/d of processing capacity.
Over in the Middle East, or, more specifically, Saudi Arabia, things are equally exciting, following oil giant Saudi Aramco’s announcement of the Fadhili gas megaproject. Scheduled to be completed by the end of 2019, the project will become a key component of the Kingdom’s much revered Master?Gas System (MGS). First initiated in 1975, the MGS became operational in 1977 with the commissioning of the Berri, Shedgum and ‘Uthmaniyah plants – designed to process associated gas recovered from oil production. Non-associated gas (found in non-crude containing natural gas reserves) from the ‘Uthmaniyah and Shedgum Khuff reservoirs was introduced to the MGS in 1984. Jumping forward, two new grassroot gas facilities, Hawiyah and Haradh, were put fully onstream in 2001 and 2003 to process non-associated gas, followed by the Hawiyah gas plant expansion and NGL recovery plant. Several years later, in 2010, the Khursaniyah gas plant (KGP) was brought onstream to process associated gas – later, in 2012, the KGP facilities were expanded to process non-associated gas from Karan reservoir Khuff gas.
The Fadhili plant, alongside Saudi Aramco’s two other new major gas projects, Wasit and Midyan, will add more than 5 billion ft3/d of non-associated gas processing capacity – the Wasit gas plant is designed to process 2.5 billion ft3/d of non-associated gas and supply 1.7 billion ft3/d of sales gas to the MGS, fuelling electrical power and seawater desalination plants and supplying feedstock for the petrochemical industry, while the Midyan plant, located in the Tabuk region and due to come onstream by the end of 2016, will have the capacity to produce and process 75 million ft3/d of non-associated gas and 4500 bpd of condensate.
With such an array of megaprojects coming onstream before the end of the decade, it will be interesting to see how their implementation impacts market, and supply and demand, dynamics over the next few years. What these projects make abundantly clear, however, is that natural gas will play an integral role in the energy market's vision for the future.
