Williams Partners funds joint venture to develop midstream infrastructure

Williams Partners has announced that it is funding a joint venture with Caiman Energy II to develop pipelines and processing infrastructure, serving producers in Ohio and other potential shale plays.

Other partners in the joint venture include EnCap Flatrock Midstream and Highstar Capital, which plan to invest about $800m to build natural gas, natural gas liquid and crude oil gathering and processing infrastructure.

Williams will contribute about $380m over several years with the key areas of focus being the natural gas liquid and oil-rich areas of the Utica Shale in Ohio and north-west Pennsylvania.

Williams Partners general partner and CEO Alan Armstrong said this new midstream venture can leverage the commercial relationships and success of Caiman’s management and investors.

"Our producer customers will benefit from introducing the kind of comprehensive large-scale midstream solutions to the area that will make their positions in the liquids and oil-rich Utica Shale even more valuable," Armstrong added.

Caiman Energy chairman and CEO Jack Lafield said, "Together with our other equity partners, Williams’ financial strength and experience allows Caiman Energy to continue to provide our producer customers with the best possible midstream solutions as they develop drilling locations in this exciting play."

Williams Partners said the Utica Shale joint venture will also have close proximity to its new Ohio Valley Midstream business with operations in northern West Virginia, south-western Pennsylvania and eastern Ohio.

Construction work has already commenced to expand existing infrastructure, which include a gathering system and a processing facility as well as fractionation and additional processing facilities and NGL pipelines.