M6 Midstream moves ahead on Haynesville Shale gas gathering project

M6 Midstream LLC (Momentum) announced that its Board of Directors has reached a final investment decision (FID) on a new natural gas gathering and carbon capture project – New Generation Gas Gathering, or NG3 – which will gather natural gas produced in the Haynesville Shale for re-delivery to premium Gulf Coast markets, including LNG export. The company also announced completion of the acquisitions of Midcoast Energy’s East Texas business (Midcoast ETX) from an ArcLight Capital Partners, LLC affiliate, as well as Align Midstream from Tailwater Capital.

“With significant long-term volume commitments from several leading Haynesville Shale producers, including Chesapeake Energy, we are pleased to reach a positive FID on our new gathering and treating project, which, combined with our existing capacity on the Midcoast system, will serve to address bottlenecks in the Haynesville Shale and provide much needed capacity to the growing LNG markets on the Gulf Coast,” said Frank Tsuru, CEO of Momentum, an independent midstream energy company. “Our customers are also excited to be part of the first of its kind net negative gas gathering project.”

Tsuru added Chesapeake Energy’s anchor commitment to NG3 includes the option to own 35% of the project, “creating alignment between Momentum and one of the largest Haynesville Shale producers.”

The NG3 project will have an initial capacity of 1.7 Bcf/d, expandable up to 2.2 Bcf/d. In addition, it will include a carbon capture and sequestration component that will remove 100% of the CO2 and permanently store it underground.

While the NG3 is not expected to begin operations until the second half of 2024, more immediate gains resulted from the two recently completed acquisitions. Midcoast ETX has an extensive gathering and transportation system with 1.5 Bcf/d of current volume and 1.0 Bcf/d of existing deliverability to the Gulf Cost and LNG markets. Align Midstream owns several gathering systems adjacent to Midcoast, with current volumes of 600 MMcf/d.

With the combined assets of the two companies, Momentum is now servicing volumes in excess of 2.0 Bcf/d across a footprint including approximately 3000 miles of gathering pipelines, 1.5 Bcf/d of treating capacity, 700 MMcf/d of processing capacity and 200000 hp of compression. In addition, 820 miles of transportation pipelines deliver gas to the Gulf Coast markets in southeast Texas and the Carthage and Bethel markets in east Texas. The assets serve a customer base comprised of producers, utilities, end users and LNG exporters.

“Pairing the extensive footprints of the Midcoast and Align assets with NG3, Momentum [will be] able to relieve existing constraints in the Haynesville Shale, particularly the Shelby Trough, and allow our producer customers to reach premium Gulf Coast markets,” said Brant Baird, president of Momentum. “We also provide these Gulf Coast markets and LNG facilities with direct access to growing Haynesville Shale production.”