Welcome to the Business Journal Archives
Search for articles below, or continue to the all new BusinessJournalDaily.com now.
Search
Rex Sells Midstream Assets to MarkWest Energy Partners
STATE COLLEGE, Pa. -- Rex Energy Corp. and its partners in Keystone Midstream Services LLC, Tuesday closed its $512 million sale of Keystone Midstream Services to a subsidiary of MarkWest Energy Partners, Denver. The sale includes two cryogenic gas processing plants in Butler County, Pa. -- the Sarsen Plant and the newly commissioned Bluestone Plant, with a combined 90 MMcf/d of capacity.
Simultaneous with the closing, affiliates of Rex Energy and its non-operating partner, Sumitomo Corp., entered into a new, long-term gathering, processing and natural gas liquids fractionation arrangement with MarkWest.
"The closing of the Keystone Midstream sale marks the beginning of a new relationship between Rex Energy and MarkWest. This transaction not only significantly improves Rex Energy's balance sheet; it is also a major step forward in our strategy to maximize the potential of our Butler and Ohio Utica operated assets," said the CEO of Rex Energy, Tom Stabley, in a prepared statement.
Rex Energy also announced it has completed drilling its first Ohio Utica well, the Brace #1H, located in Carroll County. "The well encountered approximately 135 feet of Point Pleasant formation and approximately143 feet of overlying Utica Shale formation. The vertical hole was plugged back and the well was drilled to a total measured depth of 12,332 feet with a lateral length of approximately 4,170 feet," the company said. Hydraulic fracturing is scheduled for June 2012.
Rex Energy said it intends to shut in the well for approximately 60 days following fracture stimulation to allow for dissipation of frac water before flowing the well back. The rig is in the process of moving back to the Butler operated area where it is scheduled to drill one Utica well in Lawrence County, Pennsylvania, the Hufnagel #1.
Rex holds nearly 68,400 acres in Butler County, according to Gas Business Briefing. The Bluestone cryogenic processing plant has a full inlet capacity of 50 MMcf/d and will not require additional field compression. First gas sales at the plant are expected by June 1.
In preparation for the commissioning of the plant, Rex Energy completed fracture stimulation operations on the five Marcellus wells at the Gilliland pad in May. In addition, this pad also contains the company's first Upper Devonian Burkett well, the Gilliland #11HB. These six wells, along with the two-well Carson pad, are expected to be turned into sales ratably as the plant ramps up operations over the next 45-60 days.
Published by The Business Journal, Youngstown, Ohio.