GreenHunter Resources, announced today that through its wholly-owned subsidiary, GreenHunter Pipeline LLC, it has executed multiple definitive agreements to have exclusive use of three independent pipelines. This new project covers approximately 34 miles of right-of-way to transport freshwater, oilfield waste water (brine), and hydrocarbons (oil, condensate and NGLs). Our equity partner, Major Pipeline LLC, will design, build, own, and operate the pipeline exclusively for GreenHunter’s benefit.
The Points of Receipt (POR) have been chosen in two locations in southwestern Pennsylvania and northwestern West Virginia. These regions have quickly become some of the most densely populated areas for new permitting, drilling, and producing in the Marcellus Shale Play and the evolving Utica Shale Play. The Point of Delivery (POD) will be along the Ohio River at one of GreenHunter’s barge terminal locations. GreenHunter Pipeline will own and operate the POR and the POD facilities and associated equipment.
The agreement between GreenHunter Pipeline LLC and Major Pipeline LLC provides exclusive use for transportation of the above mentioned fluids for a period of 10 years with an option to renew the contracts for an additional 10 years. The terms of the agreements are specific to each type of fluid and priced on minimum volumes of fluid intake per day.
- The brine pipeline will be constructed of 12” diameter pipe capable of transporting approximately 100,000 bbls per day.
- The freshwater pipeline will be a 16” diameter pipe with the capacity to handle approximately 140,000 bbls per day.
- The condensate pipeline will be a 6” diameter pipe that will have a capacity of approximately 30,000 bbls per day.
The first phase of the project has begun with right-of-way negotiations underway and is scheduled to be complete and 100% operational by January 1, 2016.
The pipeline destination will also include a processing facility to split condensates into different quality products, typically resulting in higher value for these finished materials for ultimate marketing. The new processing plant for condensate is scheduled to be completed on or before the third quarter of 2016.
Phase two of the project may consist of additional extensions to the primary gathering lines, extending further into Pennsylvania and possibly into Ohio. The parties anticipate the second phase to begin construction prior to the completion of the first phase.
Commenting on this new, multiple pipeline project, Mr. John Jack, Senior Vice President of Operations for Appalachia stated, “We have been working diligently with a number of active producers in our attempts to address some of the challenges they all face in southwestern Pennsylvania. By adding these multiple pipelines capable of transporting different forms of fluids, we will significantly reduce field and operating costs for these operators by using the most economical way of moving these products. Also, by streamlining the logistics, we immediately remove a large number of trucks currently on the roadways that are making long hauls to Ohio and West Virginia, which are most inefficient. Not only will the reduction of long-hauling result in less wear and tear of the existing roadways, but a significantly reduced carbon footprint will result along with increased safety for everyone.”
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