Copano Energy says it will extend its wholly-owned 96-mile, 24-inch DK Pipeline in the Eagle Ford Shale play by adding approximately 65 miles of 24-inch pipeline southwest into McMullen County, Texas.
The move will allow Copano to access significant new Eagle Ford volumes, the company said.
The DK Pipeline extension is expected to begin service in the first half of 2013 and is projected to cost approximately $120 million.
The pipeline extension will follow the same route as Copano's recently announced condensate pipeline, Double Eagle Pipeline, a joint venture with Magellan Midstream, in the rich gas window of the Eagle Ford.
The extension of the DK Pipeline is supported by a new long-term agreement with Petrohawk Energy Corp., a subsidiary of BHP Billiton and a leading operator in the Eagle Ford play.
Under the terms of the fee-based agreement, Copano will provide Petrohawk with gathering, processing and NGL handling services for a significant commitment of natural gas volumes from leases in McMullen County, Texas, the company said.
"We are pleased that BHP Billiton has selected Copano again as a provider of midstream services for its significant position in the rich gas window of the Eagle Ford shale," said R. Bruce Northcutt, CEO of Copano Energy.
"The southwest extension of our DK Pipeline coupled with the Double Eagle condensate pipeline will allow Copano to offer a full slate of gas, NGL and condensate solutions to our customers in the trend, he added.