amine treatment

While several larger midstream companies were focused on building conventional gas gathering and processing infrastructure in the Southern Delaware Basin, a handful of mostly smaller midstreamers were focusing on the Permian’s next challenge: developing systems in the Northern Delaware to gather and treat associated gas with high H2S and 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 companies have assembled.

The midstreamers that 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 to “Drill, baby, drill!” in Lea County, NM, where the IP rates for crude are high but so are the H2S and CO2 content in the associated gas. In today’s RBN blog, we look at Targa’s, Enterprise’s and MPLX’s sour-gas-related assets.

The numbers out of Eddy and Lea counties in southeastern New Mexico are nothing short of staggering. Crude oil production at 2.3 MMb/d, or one-sixth of total U.S. output. Natural gas production north of 9 Bcf/d and rising fast. More than 90 active rigs — again, one-sixth of the U.S. total. Many top E&Ps are stoked about the Northern Delaware Basin because of its stacked benches of high-quality, crude-saturated shale and carbonate formations. But much of the associated gas emerging from wells in Lea County is “off-spec” — tainted by levels of hydrogen sulfide (H2S) and carbon dioxide (CO2) that need to be dealt with — and producers and midstreamers have been scrambling to develop the sour-gas-related infrastructure required to support production growth. In today’s RBN blog, we begin a detailed look at the Northern Delaware’s existing and planned infrastructure for handling sour gas, including special gas gathering systems, amine treatment facilities, acid gas injection (AGI) wells, sweet gas pipelines and processing plants. 

The gas that emerges from wells in U.S. shale plays differs widely in its characteristics and quality. In the aptly named “dry” Marcellus in northeastern Pennsylvania, the gas is almost all methane, with only minute volumes of NGLs and contaminants, and requires minimal treatment before it’s fed into transmission pipelines. At the other end of the spectrum, the associated gas from a subset of crude-oil-focused wells in the Permian has high levels of hydrogen sulfide (a potentially deadly chemical) and carbon dioxide (a potent greenhouse gas), as well as a lot of NGLs. If the H2S level in the gas is relatively low, it can be removed from the gas stream onsite with a chemical “scavenger,” but higher levels of H2S quickly make that method prohibitively expensive. Another alternative, an onsite amine treatment facility, is more economical for removing higher levels of H2S — and it removes CO2 as well — but air permits typically limit how much can be flared off, requiring the costly and time-consuming development of acid-gas injection wells. Yet another, more centralized approach to dealing with H2S and CO2 — one that permanently stores large volumes of both deep underground — is being implemented over the next few weeks in southeastern New Mexico, as we discuss in today’s blog.