SALEM, Ohio — NiSource Gas Transmission and Storage’s Midstream & Minerals Group are partnering with Hilcorp Energy Company to develop oil and gas production in Ohio and western Pennsylvania.
NiSource companies include Columbia Gas Transmission. Hilcorp is a privately owned oil and gas exploration and development company based in Houston, Texas.
The agreement will allow the two companies to develop a significant acreage block in the Utica/Point Pleasant Shale formation in northeast Ohio and western Pennsylvania.
As part of the joint venture, NiSource will combine its existing leasehold acreage in northeast Ohio with Hilcorp’s current leased acreage block in northeast Ohio and western Pennsylvania.
In addition, the collaboration will construct new gathering pipeline infrastructure and natural gas liquids (NGL) processing facilities to support natural gas production in the same region.
Hilcorp will serve as the operator and manage the development of the combined acreage. NiSource will be a non-operating working interest owner in the project.
The newly formed midstream joint venture, Pennant Midstream, LLC, will construct an initial 50 miles of wet gas gathering pipeline facilities in northeast Ohio and western Pennsylvania with a capacity of 400 million cubic feet (mcf) per day.
In addition, Pennant will build a natural gas processing complex with an initial 200 mcf per day of cryogenic gas processing capacity along with an associated residue line in Ohio to process gas for the upstream joint venture and other interested parties.
The initial processing plant is set to be delivered yet this summer. The gathering system and processing complex, which will be operated by NiSource Midstream Services, are expected to be in-service by the third quarter of 2013.
Pennant is reviewing several options with various parties for fractionation, including development of its own facility.
Engineering and construction plans are already in progress, and community outreach will begin immediately.
Hilcorp and NiSource will work with individual surface rights owners and community officials regarding the production process and timing, as well as lease specifics.
Property owners with questions about an existing lease or right-of-way agreement can email email@example.com or call 304-357-3625.