... Azure Midstream to Expand Holly Gas Gathering System

Azure Midstream to Expand Holly Gas Gathering System

Dallas-based Azure Midstream Energy LLC plans increase capacity of its Holly Gas Gathering System to better serve the Haynesville and Bossier shale. The growth expansion project, announced Aug. 4, includes a natural gas pipeline and additional compression capabilities, with an overall cost of approximately $24 million.

Construction has begun on Azure’s Holly Production Optimization Project, which will extend the core Holly footprint and reduce line pressures to maximize the use of the 2.1 billion cubic feet per day (Bcf/d) capacity system. Reducing pressure on Holly from more than 1,200 lbs per cubic inch to 500 lbs per cubic inch enhances volume deliverability from new and existing production and enhances Azure’s competitiveness in attracting additional volumes across its Holly service area, according to a company statement.

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As part of the project, Azure will also add a 9-mile, 12-in. gathering pipeline. The lateral line will connect existing dedicated production on the northwest side of Holly and connect to several prospective undeveloped sections dedicated from existing anchor producers. The lateral will have initial throughput of approximately 40 million cubic feet per day (MMcf/d) of natural gas with potential to add substantially more supply in 2016.

Holly Optimization will also add approximately 15,000 hp of compression with ultimate capacity of 600 MMcf/d and is expected to be in service by October 2015.

Holly is primarily located within the DeSoto, Red River and Caddo parishes of northern Louisiana and currently serves the Haynesville and Bossier shale formations and the liquids-rich Cotton Valley formation. As of June 30, the Holly system consists of approximately 335 miles of high- and low-pressure pipeline, with approximately 69,000 dedicated gross acres. The system also includes four amine treating plants with combined capacity of 920 MMcf/d and two 1,340-hp compressors with connections to eight downstream access points, providing shippers with access to significant off-take capacity.

“We are pleased to be moving forward with the Holly Optimization Project,” said I.J. “Chip” Berthelot II, president of Azure Midstream Energy. “It advances Azure’s commercial focus on increasing volumes within our core areas, and growing the business through strategic commercial opportunities.”

Azure Midstream Energy LLC is a midstream company with a focus on owning, operating, developing and acquiring midstream energy infrastructure in core producing areas in the United States. The company owns 100 percent of Azure Midstream Partners GP LLC and 90 percent of the incentive distribution rights of Azure Midstream Partners LP.

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