New Mexico - Targa’s, Enterprise’s and MPLX’s Sour-Gas-Related Assets in the Northern Delaware

The handful of midstreamers that have built out and/or acquired the sour gas treatment facilities, acid gas injection wells and other assets E&Ps need to exploit the Northern Delaware Basin’s crude-oil-saturated rock are sittin’ pretty. Put simply, they anticipated what is now a race among several leading producers to “Drill, baby, drill!” in Lea County, NM, and nearby areas, where the initial production (IP) rates for crude are sky-high but the associated gas has elevated levels of hydrogen sulfide (H₂S) and carbon dioxide (CO₂) that have to be dealt with. In today’s RBN blog, we continue our look at the sour-gas-related assets in the region with a review of what Targa Resources, Enterprise Products Partners and MPLX own.

In Part 1 of this series, we said that southeastern New Mexico is the epicenter of U.S. crude oil production growth, with Eddy and Lea counties accounting for an astounding 52% of U.S. production growth from 2020-24, a four-year gain of nearly 1 MMb/d in just two counties! That growth, which has continued through the first nine months of 2025, came as a result of producers like EOG Resources, Devon Energy, Mewbourne Oil, Occidental Petroleum and Matador Resources perfecting their drilling-and-completion techniques and — with their midstream partners — solving the area’s #1 challenge: dealing with elevated levels of H₂S and CO₂ in much of the associated gas that emerges from many wells there, especially in Lea County.

We also looked at how high the H₂S and CO₂ concentrations can be and the approaches midstream companies can use to bring down those levels. Generally speaking, the most effective way to slash H₂S and CO₂ content in associated gas is to run the gas through a centralized amine treatment 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. (A bonus: The CO₂ sequestration can provide federal tax credits.)

Today, we begin our promised review of the sour-gas-related assets owned by the leading midstreamers in this particularly productive — and uniquely challenging — part of the Permian.