Monday, February 13, 2012

CONSOL Energy and MarkWest agree to accelerate natural gas supply

PITTSBURGH, Pa. -- CONSOL Energy Inc. (NYSE: CNX) on Jan. 31 announced that it has amended a previous agreement with MarkWest Energy Partners, LP (NYSE: MWE). 

Under the amendment, CONSOL Energy, through a subsidiary, contracted for the full 200,000 Mcf per day of capacity in MarkWest's Majorsville III plant. This will be in addition to the 30,000 Mcf per day that the company already had under contract in MarkWest's Majorsville II processing plant. 

There are associated agreements covering the fractionation and sale of the NGLs out of MarkWest's Houston, Pa., fractionation and marketing complex. 

At the close of the joint venture agreement between CONSOL Energy and Noble Energy in 2011, these agreements were assigned in part to Noble Energy, but are expected to be split evenly by both companies at the end of January 2012. These agreements will enable Noble Energy to continue its development efforts in the wet gas portion of the joint venture acreage. 

CONSOL Energy anticipates first production from this area in Q2 2012, also representing the company's first production from the wet area of its Marcellus acreage. By year-end 2012, CONSOL Energy and Noble Energy anticipate 20 well completions at Majorsville. 

MarkWest's Majorsville plant sits in the center of the joint venture's Majorsville acreage, keeping gathering cost to a minimum. The residue gas from the plant will initially be sold into long-term firm transportation agreements that CONSOL Energy's subsidiary CNX Gas Company LLC has under contracts on Columbia Transmission and Texas Eastern Pipelines

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