Penn Virginia to construct pipelines, compression facilities in Marcellus Shale

Source: Penn Virginia

The midstream division of Penn Virginia Resource Partners, L.P. (PVR), PVR Midstream, has entered into an agreement to construct and operate gas gathering pipelines and compression facilities servicing a private firm's Marcellus Shale natural gas production in Wyoming County, Pennsylvania. 

PVR Midstream will construct a 12-inch gathering pipeline and compression facilities with 25 million cubic feet (MMcf) per day of throughput capacity. This system is expected to become operational during the second quarter of 2010, with the potential for additional system extensions. 

PVR Midstream's 2010 capital investment in this system is anticipated to range from $6 to $7 million, with potential future system extensions costing up to $10 million. PVR Midstream expects its investment to be accretive to distributable cash flow once the system is operational. 

William H. Shea, Jr., Chief Executive Officer of PVR, said, "We are pleased to announce an additional gathering and related services arrangement in the Marcellus Shale of northern Pennsylvania. This project will generate fee-based revenue and is expected to be accretive to distributable cash flow by the third quarter of 2010. We will continue to look for opportunities to expand our presence in this emerging and potentially large resource play."

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