Targa Resources Corp. has entered into long-term fee-based agreements with an investment grade energy company for natural gas gathering and processing services in the Delaware Basin and for downstream transportation, fractionation and other related services. The agreements with Targa are underpinned by the customer’s dedication of significant acreage within a large, well-defined area in the Delaware Basin.
In the Delaware Basin, Targa will construct approximately 220 miles of 12 to 24 inch high pressure rich gas gathering pipelines across some of the most prolific parts of the Delaware Basin, a new 250 MMcf/d cryogenic natural gas processing plant (the Falcon Plant) in the Delaware that is expected to begin operations in the fourth quarter of 2019, and a second 250 MMcf/d cryogenic natural gas processing plant (the Peregrine Plant) in the Delaware that is expected to begin operations in the second quarter of 2020.
The company also announced an extension of its new common carrier natural gas liquids pipeline currently under construction (Grand Prix) into southern Oklahoma. The Grand Prix extension into Oklahoma will be anchored by significant long-term commitments for both transportation and fractionation services from Targa’s existing and future processing plants in the Arkoma area in its SouthOK system and from third party commitments, including a significant long-term commitment for transportation and fractionation with Valiant. The company continues to expect Grand Prix to be fully completed and in service in the second quarter of 2019.
Once completed, the capacity of Grand Prix from North Texas, where Permian and Oklahoma volumes will be connected to a 30-inch segment of the pipeline to Mont Belvieu, will be approximately 450 Mbpd, expandable to 950 Mbpd. The capacity on the 24-inch pipeline from the Permian Basin to North Texas will be approximately 300 Mbpd, expandable to 550 Mbpd. The capacity from southern Oklahoma to North Texas will vary based on telescoping pipe size. The vast majority of the pipe for Grand Prix has already been purchased.