5 Access Scott Hallam

MIDSTREAM METHODS: TRANSPORTATION & INFRASTRUCTURE SCOTT HALLAM, MANAGER DEVELOPMENT AND OPERATIONS

TOPICS  About Access & the Midstream Industry  Utica Shale  Bridging the Gap Through Partnerships  Financial Impacts  Supply Chain and Service Providers

ABOUT ACCESS

ABOUT THE MIDSTREAM INDUSTRY  A midstream business gathers, processes and transports natural gas and natural gas liquids (NGLs) from the wellhead to the companies that market the gas and NGLs to the public.

 This process includes: • • • •

Gathering Compression Dehydration Conditioning

 Gas treating (CO2/H2S removal)  Gas processing (NGL separation) •

Fractionation

WHY THE UTICA SHALE?

Image courtesy of the USGS

PRODUCERS TAKE NOTICE

CHALLENGES

 Lack of infrastructure • Processing plants • Pipeline • Compression facilities

 Rich gas  Securing pipeline rightof-way

“You can bring [gas and oil] out of the ground, but it doesn’t do you any good until you can move it and get it processed and get it where it’s needed … Midstream is the key.”

Terry Fleming, executive director, Ohio Petroleum Council (Akron Beacon Journal, 12/8/12)

BRIDGING THE GAP THROUGH PARTNERSHIPS

• • •

CARDINAL GAS SERVICES (CGS) UTICA EAST OHIO (UEO) UTICA GAS SERVICES (UGS)

ACCESS IN THE UTICA – GATHERING  Mission •

Services

Gas Gathering Systems

Gathering, Compression, Dehydration 5

Miles of Pipeline

71 (114 miles under construction)

Gas Gathered

92 million cubic feet per day (MMcf/d)

Ownership

Access: 66%, Operator TOTAL: 25% EnerVest: 9%

Develop the gathering assets necessary to transport and condition gas for downstream processing markets

 Market • • • • •

DTI Hastings Processing Plant DTI Natrium Processing Plant Williams Ft. Beeler Processing Plant Mark West Harrison Processing Plant UEO Cryogenic and Fractionation Plants

 Plan • • • •

625 miles of gathering pipeline infrastructure Eight (8) compressor stations Liquid handling facility (large-scale stabilization facility) Design throughput: 1.3 billion cubic feet (Bcf) of natural gas

ACCESS IN THE UTICA – COMPRESSION  A compressor is a mechanical 

device used to increase the pressure of the gas.

Access is currently constructing four Compression Facilities in Ohio: • Augusta CF • Archer CF • Kilgore CF • Scio CF

ACCESS IN THE UTICA – PROCESSING

Current Status Processing Plants

Under Construction 800 MMcf/d

Fractionation

135,000 Bbl/d (C2+)

NGL Storage

870,000 Bbls

Delivery Points

Ownership

Propane: 450,000 Bbls Butane: 300,000 Bbls Natural Gasoline: 120,000 Bbls

2 Residue Gas delivery points 2 NGL delivery points Access: 49% Momentum: 30% EnerVest: 21%

ACCESS IN THE UTICA – GATHERING  Mission •

Services

Gathering, Compression, Dehydration

Gas Gathering Systems

3

Miles of Pipeline

8

Gas Gathered

10 MMcf/d

Ownership

100% Access owned and operated

Provide gathering services for the dry gas and oil window outside of the Cardinal Gas Services dedication area. Also, operator of Cardinal Gas Services’ assets and the UEO 24” spine.

 Market • • •

DTI TL-400 DEO TPL 5 DEO dry gas gathering systems

 Plan • • •

368 miles of gathering pipeline infrastructure Six (6) compressor stations Design throughput: 1.1 Bcf/d natural gas

ENTITY INTERACTION Cardinal Gas Service

Utica East Ohio > Interstate Pipeline > Burner Tip

Processing Well

Comp

Well Well

Well Well

Comp

Fractionation

> Interstate Pipeline > Burner Tip

Well > Pure Product

PARTNERSHIPS IN ACTION

PARTNERSHIPS IN ACTION

PARTNERSHIP BENEFITS  Magnitude of acreage position requires focused midstream effort • •

Large-scale design and long-term view Capture economies of scale

 Producer partner and midstream partner work together to reduce the development “lag” • Build assets for “just-in-time” service

 Project gains first mover advantage  Volume aggregation drives development of downstream infrastructure • •

Residue/NGL takeaway Marketing leverage

 Future customers benefit • •

Timeline Infrastructure scale and capabilities

PARTNERSHIP CHALLENGES  Midstream companies and producers    

must have alignment Producer wears two hats Confidentiality Producers are actively acquiring acreage Producers are utilizing proprietary completion techniques

FINANCIAL IMPACTS

THE UTICA’S FINANCIAL IMPACT  Capital: •

Access’ planned investment, through its partnerships, is more than $1.8 billion over the next five years

 Jobs: • • • •

Currently, the estimated number of local jobs created for Ohioans in the Utica is 636 Today, more than half of the Access Midstream employees in the Utica are Ohio residents Of the 128 employees in our Canton office, 74 are on the Ohio tax rolls Of the 636 contractors working on our projects, half are union and half are open shops

PUTTING THE PIECES TOGETHER SUPPLY CHAIN & SERVICE PROVIDERS

WHAT IS SUPPLY CHAIN MANAGEMENT

SUPPLY CHAIN  What we look at for materials and service providers: • •

Materials: specifications, lead time Services: qualifications, environment health & safety (EHS) performance, capacity, past performance, pricing

 Competitive bidding process: • • •

Firm, fixed price Unit-based price Bidders’ qualifications, EHS performance/record, capacity and past performance are also evaluated

 Vendors can be: • • •

Local Regional National

ACMP VENDOR CONTACT LINE: 877-413-1023, OR VENDOR@ACCESSMIDSTREAM.COM

TYPES OF SERVICE PROVIDERS  Inspectors  Biologists  Right-of-Way (ROW) brokers  Operators  Laborers  Engineers  Arborists  Mechanics  Surveyors  Chemists  Construction specialists

ACMP VENDOR CONTACT LINE: 877-413-1023, OR VENDOR@ACCESSMIDSTREAM.COM

WHO ACCESS IS WORKING WITH  Today, Access is working with the following local service providers: • • • • • • • • • • •

Hilscher Clark Bill Hawk Welded Construction Acuren Inspection Mid-Ohio Pipeline Integrity Kokosing Beaver Construction Hodge Construction Grae-Con HPE Fabrication Canton Erectors

ACMP VENDOR CONTACT LINE: 877-413-1023, OR VENDOR@ACCESSMIDSTREAM.COM

QUESTIONS? SCOTT HALLAM, MANAGER, DEVELOPMENT AND OPERATIONS– UTICA ACCESS MIDSTREAM