Pinnacle Midstream II to Build Natural Gas Gathering and Compression System in Midland Basin
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Pinnacle Midstream II has entered into a 15-year gas gathering, processing, and purchase agreement with DoublePoint Energy. DoublePoint agreed to dedicate certain of its leasehold acreage related to natural gas production to Pinnacle.
The agreement anchors Pinnacle’s greenfield build of a new natural gas gathering and compression system in the Midland Basin. The Pinnacle Dos Picos Gathering System is expected to come into service in the second quarter of 2021 and supports the extensive multiwell pad development taking place in the Midland Basin, one of the most prolific production areas in North America.
Initially the Pinnacle Dos Picos Gathering System will service Midland, Martin, and Glasscock counties. Future expansions are planned as producer activity continues to increase. The Pinnacle Dos Picos Gathering System will give producers access to the industry’s newest gathering and compression engineering technologies that are designed to accommodate the high volumes associated with multiwell pad development and centralized drilling campaigns.
“We are extremely excited to have the opportunity to team up with DoublePoint, one of the region’s premier and most active producers,” said Pinnacle Midstream II CEO J. Greg Sargent.
“DoublePoint has some of the best and proven acreage in the basin. We believe the Pinnacle Dos Picos System’s strategic location will be a game changer for DoublePoint and many other producers operating in the Midland Basin,” added Sargent.
The Pinnacle Dos Picos Gathering System was designed with expansion in mind. The system is engineered for top-of-class runtime that will handle the increasing volumes of hydrocarbons the region’s extensive existing and undeveloped formations are expected to generate.
Pinnacle has ready access to the capital required to align the gathering and compression infrastructure in the basin with the demands of producers that are continuously developing multiple benches. Pinnacle is engaged in discussions with other producers regarding additional dedications and services.
Pinnacle Midstream II is backed by growth capital from management and Energy Spectrum Capital.
“We are very excited about Pinnacle’s Dos Picos System. The Pinnacle team’s proven ability to plan and execute on midstream infrastructure projects that anticipate their customers’ critical needs is second to none in the industry. We are very happy to be a proud partner in Pinnacle’s ongoing successes,” said Energy Spectrum Partner Mike Mayon.
Pinnacle Dos Picos System Details
The initial system will consist of more than 50 miles of primarily 16-inch low- and high-pressure gas gathering mainlines, compression facilities and access to multiple in-basin gas processing options providing producer optionality to deliver product to multiple markets. The system will allow for rapid expansion with the addition of further gathering and compression facilities as necessary.
About Pinnacle Midstream II, LLC
Pinnacle Midstream II, LLC is an independent midstream energy company headquartered in Houston, Texas. The company is a leader in natural gas services throughout the Midland Basin. Pinnacle is supported by a significant equity commitment from Energy Spectrum Partners VIII LP and Pinnacle management.
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