Canyon Midstream Developing Permian Gas Processing System

Canyon Midstream Partners LLC (Houston) has commenced development of a natural gas gathering, processing, and treating system in the Permian Basin—the James Lake System—that is anchored by a 10-year gathering agreement with an unnamed major oil and gas company.

The James Lake System will include a cryogenic processing plant in Ector County, Texas, which will have an initial processing capacity of 70 MMcfd and treating capabilities for natural gas containing hydrogen sulfide and carbon dioxide. To supply the James Lake plant, Canyon Midstream is developing 40 miles of high-pressure gathering trunk lines and three compressor stations, which will connect to low-pressure field gather­ing systems that Canyon is constructing for its anchor customer in Ector County and Andrews County, Texas.

When completed in late 2014, the James Lake System will deliver residue gas into the El Paso natural gas pipeline and offer interconnections to multiple NGL lines in Ector County. Michael Walsh, president of Canyon Midstream, said, “Canyon is pleased to have the opportunity to enhance our initial customer’s current and future production in Andrews and Ector coun­ties with the development of our James Lake project. We believe that additional gas gathering, compression, processing, and treating capacity in the Permian Basin is necessary for our customers to realize the potential of their resources and reserves.”

Walsh added that Canyon is in advanced discus­sions with producers controlling acreage and production to support additional treating and processing capacity at the James Lake plant. “Ultimately, we expect the current James Lake project will be the first phase of a distributed and integrated gathering and processing system in the Permian Basin, where Canyon will provide our custom­ers with safe, reliable, operationally efficient, and com­mercially responsive midstream services,” he said.