Expanding Piñon Midstream's Dark Horse Treating Facility for Sustainable Energy Production

Piñon Midstream, LLC recently announced major expansions to its Dark Horse Facility in New Mexico. The facility offers the latest sour natural gas treating and carbon capture solutions for oil and natural gas producers in the Delaware Basin. The Dark Horse Facility reduces the environmental impact of oil and natural gas operations in the region through the capture and permanent sequestration of carbon dioxide (CO₂) and hydrogen sulfide (H₂S).

The current facility includes two 400 GPM (gallons per minute) amine treating units, two 18,000-foot deep AGI (acid gas injection) wells, ~50,000 horsepower of fully NACE (National Association of Corrosion Engineers) compliant compression, and ~35 miles of high-pressure gathering and redelivery pipelines. With the latest expansions, Piñon will increase the treated AGI capacity up to 20 MMcf/d (million cubic feet per day), sufficient to accommodate up to 500 MMcf/d of treating capacity at the Dark Horse Facility.

Independence AGI #2 In-Service

In April 2023, Piñon placed its second AGI well, Independence AGI #2, into service. The addition of this second AGI well allows for an increased treated AGI capacity, ensuring high operational redundancy while minimizing flaring. The AGI injection capacity of Piñon's sour natural gas treating system in New Mexico is the largest of any permitted, active system in the state.

Train III Construction and Train IV Update

Piñon is increasing the sour gas treating capacity of its Dark Horse Facility by ~50% to ~270 MMcf/d (million cubic feet per day) with the addition of Train III. The construction of Train III is expected to begin in Q3 2023, with a planned in-service date of January 2024. Additionally, Piñon has initiated engineering work for Train IV.

Compression Expansion

Currently, Piñon operates four fully NACE compliant compressor stations with a total compression capacity of ~200 MMcf/d. Additionally, two compressor stations will be placed into service in 2024, bringing Piñon’s total compression capacity to ~350 MMcf/d. The growth in the compression capacity will allow Piñon to handle increased sour natural gas flow from the field.

Growing Sweet Natural Gas Operations

Piñon’s gathering and treating system includes the Grande sweet gas redelivery pipeline. This pipeline consists of 22 miles of high-pressure, 20” steel pipe connecting the Dark Horse Facility with four existing major regional processors. Piñon is actively evaluating other interconnects with third-party processors to add additional flow assurance and customer flexibility.

Additionally, Piñon now offers tailored solutions that enable customers to source sweet natural gas directly from the Grande pipeline system. This solution gives customers a cost-effective and reliable method to optimize their gas lift operations.

About Piñon

Piñon was formed in 2020 through an equity commitment from Black Bay Energy Capital to offer an efficient, sustainable, and cost-effective solution to sour natural gas produced in the Delaware Basin. Piñon provides a comprehensive suite of services, including fully NACE compliant field gathering and compression, sour condensate stabilization and marketing, amine treating, permanent geologic sequestration of CO₂ and H₂S, and high-pressure redelivery of treated sweet gas to regional processing facilities.

About Black Bay

Black Bay is a private equity firm that invests equity capital in partnership with entrepreneurial management teams who are building high-growth companies in the North American energy and chemical industries. Black Bay is currently investing out of its second fund and has approximately $565 million of assets under management.

Conclusion

Piñon Midstream's expansions of the Dark Horse Facility will provide sustainable energy and reduce the environmental impact of oil and natural gas operations in the Delaware Basin. The expansions will increase the treated AGI capacity, compression capacity, and sour gas treating capacity by ~50%. With a comprehensive suite of services, Piñon is dedicated to offering efficient, sustainable, and cost-effective solutions to sour natural gas produced in the Delaware Basin.