Permian shale gas pipeline to Mexico announced

Company expects new Roadrunner pipeline to be in service by 2019.
By Daniel J. Graeber  |  April 2, 2015 at 9:07 AM
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TULSA, Okla., April 2 (UPI) -- A new 200-mile long pipeline will carry natural gas from a shale basin in Texas to an international connection at the Mexican border, ONEOK Partners announced.

The company, which has headquarters in Oklahoma, said it formed a joint venture with Mexican gas transmission company Fermaca Infrastructure to build the Roadrunner pipeline that would transport gas from the Permian shale basin in Texas to the Mexican market.

"We see Roadrunner as a gateway asset that will connect Mexico's rapidly growing natural gas markets with U.S. producers in the developing Permian basin," ONEOK President and Chief Executive Officer Terry Spencer said in a statement.

Roadrunner will extend 200 miles from ONEOK's existing WesTex gas transmission system in Texas to an international connection at the U.S.-Mexican border. From there, it will connect to Fermaca's gas pipeline infrastructure.

Once completed in 2019, the pipeline will have the capacity to ship as much as 640 million cubic feet of shale natural gas per day.

The U.S. Energy Information Administration said it expects Permian gas production for April to average 459,000 cubic feet per day, a projected 14 percent increase from March. Activity in the Permian shale is expected to remain resilient despite recent spending cuts from U.S. energy companies responding to the low price of oil.

ONEOK said it estimated the project would cost between $450 million and $500 million.

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