Keep on Growing, Part 3 - Williams's Marcellus/Utica Gas Processing and Fractionation Assets

During the 2010s, the Marcellus/Utica region has experienced an astonishing 16-fold increase in natural gas production, from 2 Bcf/d in early 2010 to more than 32 Bcf/d today. The region’s rapid transformation from minor energy player to superstar came with a lot of infrastructure-related growing pains, many of them tied to the urgent need for more gas pipeline takeaway capacity. Takeaway constraints have largely been addressed — at least for now — but producers’ continuing efforts to develop “wet,” liquids-rich parts of the Marcellus/Utica have resulted in an ongoing requirement for more gas processing and fractionation capacity. Put simply, as wet-gas production ramps up, so must the region’s ability to process that gas and its associated natural gas liquids. Today, we continue a series on existing and planned gas processing and fractionation projects in the Northeast with a look at the growing role played by Williams and its new Canadian partner.

As we said in Part 1, the run-up in Marcellus/Utica gas production — and RBN’s expectation of further growth to about 40 Bcf/d by 2024 — would not be possible without the new gas-processing and fractionation capacity that midstream companies have been bringing online at a steady pace in the wet parts of the play in southwestern Pennsylvania, eastern Ohio and northern West Virginia. Over the past 10 years, gas processing capacity in the region has increased from about 600 MMcf/d to more than 10 Bcf/d, and plans are underway to add as much as another 2 Bcf/d of processing capacity over the next two or three years, with some of that scheduled to be commissioned later in 2019. By necessity — namely the need to separate mixed NGLs (also known as y-grade) into so-called NGL “purity products” within the region — a lot of new fractionation capacity has been added in the Northeast too.

In Part 2, we focused on the assets owned by MPLX, which is by far the leading gas processor and fractionator in the Marcellus/Utica, with a total of just over 7 Bcf/d of gas processing capacity at eight complexes in the region, 284 Mb/d of de-ethanization capacity (a.k.a. a C2 fractionator, for removing ethane from mixed NGLs), and 347 Mb/d of C3+ fractionation capacity (to separate the remaining NGL mix into propane, butane, natural gasoline etc.). In a defining move, MPLX — a master limited partnership formed by MPC seven years ago to own, operate, develop and acquire midstream energy infrastructure assets — in December 2015 acquired MarkWest Energy Partners, which already had built out a far-reaching network of Marcellus/Utica processing plants, fractionators and pipelines to transport ethane and C3+ mixes within the region. MPLX continues to expand that network: in the fourth quarter of 2019, it plans to start up another 400 MMcf/d of processing capacity, and in the second quarter of 2020, it will add 200 MMcf/d more. It’s also planning to add 20 Mb/d of de-ethanization capacity and 80 Mb/d of C3+ fractionation capacity.