CAMERON - As the latest example of the how quickly the Marcellus and Utica shale rush is burgeoning, MarkWest Energy will more than double the capacity of its Majorsville processing plant in eastern Marshall County by the end of next year.
The Denver, Colo.-based company will also build totally new processing plants on the western side of the Ohio River in Monroe and Harrison counties, an investment that Ohio Gov. John Kasich said will total about $500 million.
Although Kasich quoted the $500 million figure for the Monroe and Harrison County investments during a JobsOhio board meeting Wednesday, a spokesman for MarkWest, who declined to give his name, said the company would not divulge the cost of the new plants. He also said the company is still working out the details for the exact locations for the Ohio facilities.
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MarkWest Energy Partners soon will be able to process 670 million cubic feet of natural gas per day at its Majorsville complex in eastern Marshall County.
The work in Ohio should create about 700 construction-related jobs and more than 40 full-time, long-term positions with MarkWest, company information notes.
"We are very excited to announce significant midstream projects that are critical to the full development of the liquids-rich areas of the Marcellus Shale in southwest Pennsylvania and northern West Virginia and the Utica Shale in eastern Ohio," said Frank Semple, chairman, president and chief executive officer of MarkWest.
Companies such as Chesapeake Energy, Chevron and XTO Energy are known in the industry as "producers" because these companies sell the gas they pump out of the ground. Because the "wet" Marcellus and Utica shale gas requires processing before it can go to market, producers send their gas to companies such as Dominion Resources, Caiman Energy or MarkWest for processing and fractionation.
In natural gas processing, the "dry" methane part of the gas stream is separated from the "wet" portions, like ethane, butane, propane and pentane. During fractionation, the natural gas liquids and other substances are separated from each other. These separated gas products are then ready for use, with the ethane possibly going to a cracker plant.
The project at Majorsville calls for MarkWest to increase processing capacity from 270 million cubic feet of gas per day to 670 million cubic feet per day next year. Consol Energy, Noble Energy and Range Resources have agreed to supply gas to the Majorsville complex. Ethane, butane, propane and pentane recovered by MarkWest go to the company's Houston, Pa., marketing and storage complex.
The company also plans to install an ethane pipeline between the Majorsville and Houston complexes. In order to keep up with the demands of the producers sending their gas to MarkWest, the company plans to increase its capacity to produce ethane to 115,000 barrels per day by 2014.
"The full spectrum of natural gas midstream (gas processing and piping) services - particularly the fractionation and marketing of natural gas liquids at world-scale fractionation complexes - is critical to the success of Utica and Marcellus producers, and MarkWest will continue to be a leading provider of integrated midstream services in the Northeast," Semple added.
The Harrison complex will include 200 million cubic feet of processing capacity per day - and is expected to begin operations in mid-2013. The Monroe County facility is also expected to begin operation next year.
Company officials are determining the final capacity of the Monroe County complex, which is also expected to begin operations in 2013. Both processing complexes will be connected via a natural gas liquids gathering system to the Harrison County fractionation facilities that will be operational in 2013.
MarkWest leaders believe building these plants will allow them to claim the two largest fractionation complexes in the northeastern U.S.