While several larger midstream companies were focused on building and expanding conventional gas gathering and processing infrastructure in the Southern Delaware Basin in West Texas, a handful of mostly smaller midstreamers were focusing on the Permian’s next challenge: developing systems in the Northern Delaware Basin to gather and treat associated gas with high hydrogen sulfide (H2S) and carbon dioxide (CO2) content. In today’s RBN blog, we continue our look at the region’s sour-gas-related assets with a review of what a few of these forward-looking companies have assembled.
In Part 1 of this blog series, we said that southeastern New Mexico is the epicenter of U.S. crude oil production growth, with Eddy and Lea counties accounting for just over half of U.S. production gains from 2020-24, a four-year increase of nearly 1 MMb/d. That phenomenal growth, which continued through the first three quarters of 2025, came as a result of a cadre of producers perfecting their drilling-and-completion techniques and — with their midstream partners — dealing with elevated levels of H2S and CO2 in the associated gas that emerges from many wells there.
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We also explained that, generally speaking, the most effective way to slash H2S and CO2 content in associated gas is to run the gas through a centralized amine treating facility, then compress the resulting H2S/CO2 mix into a supercritical liquid and inject it into an acid gas injection (AGI) well for permanent sequestration.
In Part 2, we discussed the sour-gas-related assets owned by three of the leading midstreamers in this particularly productive — and uniquely challenging — part of the Permian, namely, Targa Resources, Enterprise Products Partners and MPLX. Interesting fact: Each of these companies became a leader in handling sour gas in large part by acquiring smaller companies like the ones we zero in on in today’s blog.
First up is Kinetik Midstream, which owns and operates extensive gas gathering and processing assets in Eddy, Lea and Chaves counties in southeastern New Mexico — and on the Texas side of the Delaware Basin, too. Most important for our discussion today, Kinetik (1) in June 2024 acquired Durango Permian LLC and its expansive Northern Delaware gathering and processing system, and (2) more recently announced plans to increase that system’s capacity for treating sour gas and sequestering H2S and CO2 via AGIs.
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About the song
“New Mexico” was written by Johnny Johnson and Leon Lambson. It appears as the third song on side two of Johnny Cash’s 13th studio album, The Original Sun Sound of Johnny Cash. It was never released as a single. The song portrays the troubles that some cowboys encountered while driving a herd of cattle across New Mexico, only to find no paycheck at the end of their endeavor. Personnel on the record were: Johnny Cash (lead vocal, rhythm acoustic guitar), Luther Perkins (lead electric guitar), and Marshall Grant (bass).
The Original Sun Sound of Johnny Cash is a compilation album of songs Cash recorded for Sam Phillips’s Sun Records label in Memphis from 1955 to 1958. Cash had three singles for Sun Records that charted, but none of them are on this collection. Released in November 1964, the album did not make the charts. One single was released from the LP.
Johnny Cash was an American country music singer and songwriter. Because of his all-black stage apparel, he became known as “The Man in Black.” He rose to popularity in the mid-1950s, performing rockabilly and country music with his Memphis trio, The Tennessee Three. He released 68 studio albums, four soundtrack albums, 16 live albums, 105 compilation albums and 70 singles and has sold over 90 million records worldwide. Cash appeared in 17 films and documentaries and several television shows, including The Johnny Cash Show, which he hosted for 58 episodes from 1969 to 1971. He has won four ACM Awards, an American Music Award, nine CMA Awards, 20 Grammy Awards and an MTV Video Music Award, and is a member of the Country Music Hall of Fame, Gospel Music Hall of Fame, Grammy Hall of Fame, and Rock and Roll Hall of Fame. Cash has received Kennedy Center Honors and has a star on the Hollywood Walk of Fame. Johnny Cash died in Nashville in September 2003 at 71.
