Williams and Targa Resources to link markets via new pipeline
Williams and Targa Resources Corp. announced this week that their Conway, Kan., and Mont Belvieu, Texas, natural gas liquids markets would soon be linked by a 188-mile pipeline called Bluestem.
The line will run from Williams’ fractionator in Kansas to an interconnect with Targa’s Grand Prix NGL Pipeline in Oklahoma. At the same time, Targa will build a 110-mile extension to the Grand Prix that will run into central Oklahoma and connect with the new Bluestem. In this way, the companies hope to improve market access and to capitalize on the growing NGL volumes being produced in the Wamsutter and DJ Basin operations.
“Expanding our NGL pipeline business to interconnect with Targa’s strategically-positioned Grand Prix Pipeline will provide Williams and our customers with access to Mont Belvieu while opening up additional markets for Conway,” Alan Armstrong, president and CEO of Williams, said. “Additionally, this delivers a long-term infrastructure solution for NGLs from our Opal, Echo Springs, Willow Creek, and Rocky Mountain Midstream processing complexes while also creating a platform for growth – offering us the opportunity to gain incremental downstream revenues as we expand our G&P business.”
Williams committed significant volumes for Targa to transport as part of this project, allowing them to run it through Grand Prix for fractionation at Targa’s own Mont Belvieu facilities. Further connecting the two, Williams will have an initial option to purchase 20 percent equity interest in one of Targa’s new fractionation trains in Mont Belvieu.
“We are very pleased to be working with Williams to enhance market access for NGLs,” Joe Bob Perkins, CEO of Targa, said. “The further expansion of our Grand Prix NGL Pipeline into the STACK is an attractive extension of a highly strategic asset for Targa and will direct significant incremental NGLs over the long-term from Williams and other third parties to Grand Prix and to our downstream assets in Mont Belvieu and Galena Park.”
Initial capacity on Targa’s extension could reach as high as 120,000 barrels per day, expected to cost approximately $200 million. Williams expects its own investments to be between $350 million to $400 million. The companies hope to see both projects up and running by the first-quarter of 2021.
