Williams puts brakes on processing plant expansion | PostIndependent.com

Williams puts brakes on processing plant expansion

John Colson
Post Independent staff

PARACHUTE — The Williams company has delayed plans for a $200 million expansion of its natural-gas processing plant on Parachute Creek, a company spokeswoman confirmed on May 10.

The plant expansion was to have opened in 2014, under the initial plans, but a slowdown in drilling for natural gas has put that off until at least 2016, wrote spokeswoman Sara Delgado, senior communications specialist with Williams’ headquarters in Tulsa, Okla.

Noting that it is a price-driven issue, Delgado wrote, the decline in the prices commanded by natural gas in recent years has forced many drillers to shift their activities to areas known for crude oil or “wet gas,” which is rich in a number of lucrative natural-gas liquids (NGLs), which currently command higher prices than natural gas on the international market.

Recent increases in the price of natural gas itself, she added, “reduces the margins (price differentials) for NGLs (compared to natural gas).”

The plant, located a little over four miles up Parachute Creek from the town of Parachute, has been in the news recently as Williams Midstream and WPX Energy, two new companies created last year when Williams Production RMT split in two, have worked to locate and stop a leak in a pipeline corridor leading from the existing processing plant.

Delgado explained that Williams had planned to build a 350-million cubic-feet-per-day facility, with a “cryogenic” unit designed to chill natural gas to a temperature enabling recovery of such NGLs as ethane, propane and butane that cannot be captured using the existing plant’s technology.

“We had been working toward an in-service date of mid-2014,” Delgado reported, “but with the slowdown of natural gas drilling in the Piceance Basin we are delaying that in-service date to mid-2016.”

She wrote that the company had estimated a workforce of about 80 contract workers at the peak of construction, but that there had been no plans to hire additional full-time employes to operate the expanded plant once it is finished.

“The current Williams workforce in Parachute had the capacity to operate the new facility,” Delgado wrote.

The delay, she emphasized, “had nothing to do with our current cleanup activities related to the hydrocarbon spill.”

She reported that the plant’s existing level of operations will continue unchanged in the meantime.

jcolson@postindependent.com

Editor’s note: Due to a production error, an incomplete, preliminary version of this story was published in the Tuesday, May 14, edition of the Post Independent. The previously published version also incorrectly cited a Daily Sentinel story, which had correctly attributed to Tom Droege, a spokesman for Williams, a statement saying the delay had nothing to do with the leak or the cleanup.


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