Marathon signs deal to boost Delaware Basin operations

Marathon Oil, a major player in oil and gas exploration in Oklahoma’s STACK and SCOOP plays has executed a long-term natural gas gathering and processing agreement for operations in southeast New Mexico.

Marathon’s Permian LLC, a subsidiary of Marathon Oil reached the deal with Lucid Energy group.  Lucid provides midstream services to Marathon under a long-term acreage dedication for all of Marathon’s operated acreage in Lea County, New Mexico and part of Marathon’s operations in Eddy County, New Mexico.

As a result of the agreement, Lucid will significantly expand its existing gathering and compression infrastructure network. Lucid is considered the largest privately held natural gas processor in the Delaware Basin. It provides a full range of gas midstream services to more than 50 customers in New Mexico and West Texas.

Lucid also announced it is preparing to commission a new cryogenic processing plant at its Red Hills Natural Gas Processing Complex in Lea County. Known as Red Hills III, the new plant has the capacity to process 200 million cubic feet per day (MMcf/d) and is expected to come into service in October 2018. Red Hills III will provide additional processing capacity in support of near-term production from new commercial agreements, including the Marathon agreement. The plant is Lucid’s fifth cryogenic plant in southeast New Mexico and will bring Lucid’s total processing capacity in the Delaware Basin to 750 MMcf/d.

Lucid is supported by growth capital commitments from a joint venture formed by Riverstone Global Energy and Power Fund VI, L.P., an investment fund managed by Riverstone Holdings LLC(“Riverstone”), and investment funds managed by the Merchant Banking Division of The Goldman Sachs Group Inc. (“Goldman Sachs MBD”). Please visit www.lucid-energy.com for more information.