Dominion to build W. Va. processing, fractionation for shale plays

Dominion, Richmond, Va., will build new 200-MMcfd gas processing and 36,000-b/d fractionation capacities along the Ohio River in Natrium, W.Va., it announced Aug. 4 as part of the next major project in the Marcellus and Utica shale regions.

First phase is scheduled to begin operating by December 2012, said the company, and the capacity is more than 90% contracted.

"We are working to secure additional producer commitments for a second phase of the project," said Thomas F. Farrell II, chairman, president, and chief executive officer of Dominion.

Once those contracts are finalized, efforts to expand the Natrium plant to process a total of 400 MMcfd and fractionate 59,000 b/d of NGLs will be under way, he said.

At the Natrium site, Dominion will be able to access production in both the Marcellus and Utica shales and ship products via barge, rail, truck and pipe, said Gary Sypolt, chief executive officer of Dominion Energy.

Dominion exercised its option with PPG Industries to purchase land and locate the new plant adjacent PPG's Natrium plant in Marshall County, about 9 miles north of New Martinsville, W.Va., said the announcement.

It will connect to Dominion Transmission's 24-30-in. TL-404 pipeline from the Hastings extraction plant in Wetzel County, W.Va., to a connection with Dominion East Ohio in Monroe County, Ohio. Dominion recently converted TL-404 to a wet-gas line. Dominion East Ohio is Dominion's natural gas distribution subsidiary in Ohio.

The new plant responds to the need for additional processing and fractionation capacity in the region, said the company. “The rising price of oil and the low price of natural gas have shifted drilling activity in the region from the dry gas to the wet gas” as producers try to capture the economic value of the NGLs, it said.

The largest customer is Chesapeake Energy Marketing Inc., a subsidiary of Chesapeake Energy Corp., which has contracted for 100 MMcfd with an option for capacity on the second phase.

Dominion retained CB&I, Houston, to be the engineering, procurement, and construction contractor for the first phase.