A restructuring of an agreement between Williams Partners and Crestwood Equity Partners with Chesapeake Energy has been announced on the natural gas gathering and processing services in the Powder River Basin in Wyoming.
Williams Partners L.P. of Tulsa and Crestwood Equity Partners L.P. of Houston, Texas are 50/50 joint venture partners in the Bucking Horse natural gas processing plant and the Jackalope Gas Gathering System.
The restructured services, according to the announcement, are expected to replace the current cost-of-service arrangement and improve economics to support a ramp-up in near-term development and production activity.
“The restructuring will create a win-win for the joint venture and for Chesapeake that aligns interests for mutual growth,” said Walter Bennett, senior vice president of Williams’ West operating area.
Doug Lawler, Chesapeake’s president and chief executive was equally pleased. “This new agreement is a result of the positive relationships we have built with Williams Partners and Crestwood and our shared design to improve the economics of this play.”
The Bucking Horse plant has the capacity to process 120 million cubic feet of natural gas a day. The Jackalope gathering system includes nearly 184 miles of low pressure gathering pipelines.