Oklahoma 2018

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OKLAHOMA: MIDSTREAM 36 | November 2018 | serves producers across more than 57,000 ded- icated acres in the volatile oil, condensate and wet-gas windows of the Stack play in Woodward, Dewey, Blaine and Canadian counties. Gathering includes 84 miles of 20-in. steel trunk line and five field compression stations with 21,000 hp installed. An additional 5,500 hp of compression is on order in anticipation of well completions scheduled through the autumn. The plant was built at 200 MMcf/d of gas sub-cooled cryogenic processing and has access to residue-gas markets on ANR and Southern Star Central. Based on recent well results and projected volumes dedicated, CMP2 has already started preliminary evaluation and design work for a second 200 MMcf/d processing system at Redcliff. Kayne Anderson Energy Funds (KAEF) has raised more than $6.3 billion of committed cap- ital dedicated to energy private-equity invest- ments in primarily upstream and midstream operators. KAEF has about 25 active portfolio companies across North America. "We consider ourselves mostly upstream inves- tors, specifically drilling for oil," said Chuck Yates, managing partner for Kayne Anderson. "We put together acreage positions leveraging our engi- neering expertise to make drilling economical. We built our midstream system in the Stack with 200 MMcf/d of processing capacity because we have three upstream portfolio companies that we knew could fill it." There is existing midstream infrastructure in the area, but in Yates' assessment, "those are generally older systems that cannot handle the modern wells and pads with their high initial production rates. There may be fewer wells than in previous years, but there are significantly bigger volumes." Given that reality, the reasoning was clear: "Let's back a midstream company and put them in the same room as our upstream portfolio companies," Yates said. "It will be a win for all of them. The midstream entity can charge market rates and be more reliable than legacy assets. From a producer's perspective, downtime on a midstream system can destroy your type curve." Canyon Midstream's Redcliff gas-gathering, treating and processing project in the Stack play has been in service since April 2018. The system comprises a 200 MMcf/d cryogenic plant in Woodward County, 155 miles of gathering line, and five field compression stations in Woodward, Dewey, Blainem and Canadian counties. The Redcliff system delivers residue gas to ANR and Southern Star, and NGLs to ONEOK. (Photo courtesy of Kayne Anderson Energy Funds)

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