Tall Oak Midstream secures acreage dedication in Oklahoma’s STACK play

Tall Oak Midstream LLC has secured a long-term, fee-based natural gas gathering and processing agreement with a large acreage holder/natural gas producer in the US Mid-Continent’s STACK play.

The company has dedicated production from all existing and future wells drilled on 40,000 net acres located in Oklahoma’s Kingfisher and Blaine counties. The associated production will be gathered and processed at Tall Oak’s Chisholm Processing Complex, a cryogenic processing facility located in Kingfisher County.

Construction of the Chisholm plant is proceeding on schedule, and the first cryogenic processing train is expected to come into service in September with an initial capacity of 100 MMcf/d. To support the new dedication and increased demand from other customers, Tall Oak has ordered a second cryogenic train for the Chisholm complex that will add 200 MMcf/d in processing capacity, bringing the facility’s total processing capacity to 300 MMcf/d.

Plans call for the second train to come online in the third quarter of 2016. Future expansions at the Chisholm complex will allow for a total of 700 MMcf/d in processing capacity as customer demand increases. Tall Oak is operating more than 100 miles of gathering pipelines in the STACK play, with plans to complete an additional 100 miles of pipe and two more compressor stations in 2015.

Tall Oak is also proceeding on the design and right-of-way acquisition for a crude oil gathering, storage, and transportation system designed to serve producers in the STACK play. Anchored by a long-term agreement with Felix Energy LLC, the crude oil system will connect to multiple downstream pipelines that provide direct access to the market center at Cushing, Oklahoma.

Tall Oak expects to bring the system into service by the fourth quarter of 2015. Tall Oak’s initial crude oil system will consist of a storage and truck-unloading facility east of Okarche, Oklahoma, in the center of the STACK play, and a 20-mile pipeline that will provide connections to multiple downstream markets. The Okarche facility will have the capacity to store 40,000 barrels of crude oil. Ultimately, Tall Oak expects to construct more than 200 miles of crude oil gathering pipelines and 150,000 barrels of storage.



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