Natural Gas Processing

Natural Gas Processing Assets

At the core of our natural gas processing business are 25 processing plants located in Colorado, Louisiana, Mississippi, New Mexico, Texas and Wyoming. Our natural gas processing facilities can be characterized as two distinct types: (i) straddle plants situated on mainline natural gas pipelines owned either by us or by third parties or (ii) field plants that process natural gas from gathering pipelines. We operate the Meeker, Pioneer, Toca, Chaco, North Terrebonne, Calumet, Neptune, Burns Point and Carlsbad plants and all of the Texas facilities. On a weighted-average basis, utilization rates for these assets were 66.4%, 66.4% and 56% during the years ended December 31, 2008, 2007 and 2006, respectively. These rates reflect the periods in which we owned an interest in such facilities.

In general, natural gas produced at the wellhead contains varying amounts of NGLs. This “rich” natural gas in its raw form is usually not acceptable for transportation in the nation’s major natural gas pipeline systems or for commercial use as a fuel. Natural gas processing plants remove the NGLs from the natural gas stream, enabling the natural gas to meet transmission pipeline and commercial quality specifications. In addition, on an energy equivalent basis, NGLs generally have a greater economic value as a raw material for petrochemical and motor gasoline production than their value as components of the natural gas stream. After extraction, we typically transport the mixed NGLs to a centralized facility for fractionation (or separation) into purity NGL products such as ethane, propane, normal butane, isobutane and natural gasoline. The purity NGL products can then be used in our NGL marketing activities to meet contractual requirements or sold on spot and forward markets.

Gas Processing Facility	Company Ownership Interest in Facility ⁽¹⁾	Gross Gas Processing Capacity (Bcf/day)	Offshore Pipelines Served	Connections to Onshore Pipelines
Gulf Coast Plants
Yscloskey, LA	14.6%	1.85	Garden Banks, Viosca Knoll, Tennessee	Tennessee
Calumet, LA	32.7%	1.60	Manta Ray, ANR, Trunkline, Garden Banks	ANR, Trunkline
North Terrebonne, LA	52.5%	1.30	Manta Ray, Transco, Garden Banks	Transco
Toca, LA	67.4%	1.10	SONAT, Viosca Knoll, Mississippi Canyon	SONAT
Pascagoula, MS	40.0%	1.50	Destin, Viosca Knoll, Okeanos	Transco, Tennessee, Florida Gas, SONAT, Gulf South
Neptune, LA	66.0%	0.65	Manta Ray, Nautilus	Acadian Gas, Cypress Gas, Texas Gas, Tennessee, Gulf South, LIG

Gas Processing Facility	Company Ownership Interest in Facility ⁽¹⁾	Gross Gas Processing Capacity (Bcf/day)	Producing Regions	Connections to Onshore Pipelines
Western U.S. Treating Plants
Chaco, NM (Processing)	100%	0.65	San Juan Basin	EPNG
Pioneer, WY ⁽²⁾	100%	1.30	Green River Basin	Wyoming
Meeker, CO ⁽³⁾	100%	1.40	Piceance Basin	Colorado. REX, TransColorado, CIG, WIC & Questar

Gas Processing Facility	Company Ownership Interest in Facility ⁽¹⁾	Gross Gas Processing Capacity (Bcf/day)	Connections To Onshore Pipelines
Texas Plants
Armstrong	100%	0.25	Texas Intrastate Pipeline System
Gilmore	100%	0.26	"
Shoup	100%	0.29	"
Thompsonville	100%	0.30	"
Others ( 10 facilities )	Various	2.85	Texas, New Mexico, Louisiana
Total Gross Processing Capacity		15.30
Total Net Processing Capacity		8.65 ⁽⁴⁾

⁽¹⁾ Our ownership in these facilities ranges from 7.4% to 100%.
⁽²⁾ We acquired a silica gel natural gas processing facility from TEPPCO in March 2006 and subsequently increased the processing capacity from 0.3Bcf/d to 0.6 Bcf/d. In addition, we constructed a new cryogenic processing facility having 0.7 Bcf/d of processing capacity, which became operational in February 2008.
⁽³⁾ We commenced natural gas processing operations at our Meeker facility in October 2007 and subsequently began the Meeker Phase II expansion project to double the natural gas processing capacity to 1.5 Bcf/d at this facility. The Meeker Phase II expansion became operational during the first quarter of 2009.
⁽⁴⁾ The approximate net natural gas processing capacity does not necessarily correspond to our ownership interest in each facility. It is based on a variety of factors including volumes processed at facility and ownership interest in the facility.

Return to Top of Page