The Atwater Valley Producers Group includes Anadarko Petroleum Corp., Hydro Gulf of Mexico, LLC, formerly known as Spinnaker Exploration Company; Devon Energy Corp., and Energy Resources Technology, Inc., a wholly owned subsidiary of Cal Dive International Inc.
The three additional natural gas discoveries to be tied into Independence Hub are the Mondo NW field, discovered in January 2005 (Anadarko 50% working interest and operator; Murphy Oil 50% working interest), the Cheyenne field, announced in January 2005 (Anadarko 100% working interest) and the Q field, discovered in June 2005 (Hydro 50% working interest and operator; Dominion 50% working interest).
The cost of the expansion is approximately $28 million, and is principally supported by an increase in fixed fees that the Atwater Valley Producers Group will pay during the first five years of operations of the Independence Hub platform. The facilities, currently under construction, are expected to be installed in 2006 and receive first production in 2007.
The Independence Hub and Trail projects, first announced in November 2004, are being developed to process and gather natural gas and condensate production from the Atwater Valley, DeSoto Canyon, Lloyd Ridge and Mississippi Canyon areas located in the eastern region of the deepwater Gulf of Mexico. At the time of the announcement there were seven natural gas fields discovered. As part of the original agreement, the Atwater Valley Producers Group dedicated future production from a number of undeveloped blocks in the area.
"We are pleased to announce this expansion which will increase the capacity of the Independence platform and pipeline projects by 18%, as a result of producers' continuing success in the development of this important area of the deepwater trend," said Robert G. Phillips, President and Chief Executive Officer of Enterprise. "With 10 natural gas fields discovered on the acreage dedicated to these facilities, I believe this project is supported by one of the best reserves to production profiles of any deepwater project that we have developed in the Gulf of Mexico over the past 10 years. Further, we are pleased to report that the project remains on schedule and on budget and will be an important source of new natural gas production to meet the nation's growing energy needs."
The Independence Hub, which is 80 percent-owned by affiliates of Enterprise, and 20 percent-owned by Cal Dive International, Inc., is a state of the art 105-foot deep-draft, semi-submersible platform with a two-level production deck to be located in Mississippi Canyon block 920. The platform is currently under construction with the hull approximately 60% complete and the topsides or production facilities approximately 70% complete. The platform is expected to be mechanically complete in the first quarter of 2007. Anadarko will operate the platform that is designed to process production from the initial 10 anchor fields, with excess payload capacity to tie-back up to nine additional subsea pipelines.
The Independence Trail Natural Gas Pipeline, which is wholly owned by an affiliate of Enterprise, is a new 134-mile, 24-inch pipeline that will transport production from the Independence Hub to an interconnect with Tennessee Gas Pipeline located in West Delta block 68. Construction of the pipeline is scheduled to be completed in the fourth quarter of 2006. Both the platform and the pipeline are fully subscribed by the Atwater Valley Producers Group for the first five years of service.
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