080713 - Kmp-mwe Utica Project Loi - Final

7/27/2019 080713 - Kmp-mwe Utica Project Loi - Final

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KINDER MORGAN, MARKWEST UTICA EMG ANNOUNCE PLANS

TO FORM JOINT VENTURE TO SUPPORT NORTHERN OHIO RICH-GAS

DEVELOPMENT AND NGL TAKEAWAY FROM THE UTICA AND MARCELLUS

SHALE RESOURCE PLAYS

HOUSTON, Aug. 7, 2013 Kinder Morgan Energy Partners, L.P. (NYSE: KMP)

(Kinder Morgan), and MarkWest Utica EMG, L.L.C. (MarkWest Utica EMG), a joint venture

between MarkWest Energy Partners, L.P. (NYSE: MWE) (MarkWest) and The Energy and

Minerals Group (EMG) today announced they have signed a letter of intent to form a midstream

joint venture (JV) to pursue two critical new projects to support producers in the Utica and

Marcellus shales in Ohio, Pennsylvania and West Virginia. The first project consists of the

development of a 400 million-cubic-foot-per-day (MMcf/d) cryogenic processing complex in

Tuscarawas County, Ohio, utilizing an existing, 220-acre site that Kinder Morgan has under

option. The second project consists of the development of an initial, 200,000 barrels-per-day

(bpd), C2+ natural gas liquids (NGL) pipeline that originates at the planned JV processing

facilities in Ohio and transports NGLs to Gulf Coast fractionation facilities.

Key elements of the processing complex project include:

MarkWest Utica EMG would anchor the JVs first of two planned 200 MMcf/dcryogenic processing plants to be constructed on Kinder Morgans existing 220-acre site

in Tuscarawas County, Ohio (JV processing complex). The JV would expect the initial

200 MMcf/d cryogenic processing plant to be in service by the fourth quarter of 2014

with the second 200 MMcf/d plant in-service shortly thereafter, subject to timing of

customer commitments. The existing 220-acre site is expandable and could accommodate

more than 1 billion cubic feet per day of processing capacity;

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LOI-Joint Venture Page 2

MarkWest Utica EMG would deliver rich-gas volumes to the JV processing complexthrough an extension of its existing rich-gas gathering system in Harrison, Belmont,

Guernsey, Noble and Monroe counties in Ohio. The JV processing complex would

provide MarkWest Utica EMGs producer customers with additional residue outlets into

the Tennessee Gas Pipeline and Dominion Transmission pipeline systems;

The JV processing complex would serve new customers in Carroll, Columbiana,Mahoning and Trumbull counties in northern Ohio and provide a critical full-service

solution, which includes gas processing, NGL transportation and fractionation and

residue gas outlets;

To deliver the northern Utica gas to the processing complex, Kinder Morgan has obtainedregulatory approval to convert a portion of an existing 26-inch Tennessee Gas Pipeline

Company, L.L.C. pipeline into rich-gas gathering service, which could begin receiving

rich-gas by the fourth quarter of 2014;

The JV would construct a new pipeline to deliver NGLs produced at the JV processingcomplex into MarkWest and MarkWest Utica EMGs extensive NGL gathering network

for short-term and long-term fractionation at its Ohio and Pennsylvania fractionation and

marketing complexes; The JV would own the processing complex on a 50-50 basis and MarkWest Utica EMG

would operate the facilities;

Key elements of the NGL pipeline project include:

Kinder Morgan and MarkWest Utica EMG will develop a NGL pipeline project from thetailgate of the JV processing complex to Gulf Coast fractionation facilities through the

conversion of over 900 miles of Kinder Morgans 24-inch and 26-inch Tennessee Gas

Pipeline system currently in natural gas service from Tuscarawas County, Ohio to

Natchitoches, La., and the construction of approximately 200 miles of new NGL pipeline

from Natchitoches to Mont Belvieu, Tex., and/or south Louisiana. Kinder Morgan and

MarkWest Utica EMG are evaluating constructing new fractionation facilities, as well as

utilizing third-party fractionation facilities throughout the Gulf Coast;

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The proposed NGL pipeline would access MarkWest and MarkWest Utica EMGsextensive NGL pipeline network that extends throughout the rich-gas areas of the

Marcellus and southern Utica to deliver NGLs to the new NGL pipeline;

By converting over 900 miles of existing Tennessee Gas Pipeline assets and utilizingMarkWest and MarkWest Utica EMGs existing NGL network, the JV parties believe

their NGL pipeline is best positioned to provide the most cost effective Y-grade outlet

from the Utica and Marcellus shale plays to the Gulf Coast area markets;

The NGL pipeline would be expandable to 400,000 bpd with the addition of pumpstations;

Subject to sufficient shipper commitments, permitting and all related regulatoryapprovals, a fourth quarter 2015 in-service date for the NGL pipeline is anticipated.

Kinder Morgan would own at least 75 percent of the NGL pipeline and MarkWest UticaEMG would have the option to invest up to 25 percent. Kinder Morgan would operate

the pipeline.

We are pleased to announce this exciting joint venture with MarkWest in the Utica and

Marcellus shale resource plays, said Kinder Morgan Chairman and CEO Richard D. Kinder.

The combination of Kinder Morgans strategically located and existing pipeline assets that

traverse through the heart of the Utica and Marcellus shale plays, along with MarkWestsexisting and significant midstream footprint throughout the Utica and Marcellus shale plays,

should provide significant growth opportunities for the JV.

We are excited to partner with Kinder Morgan in this unique opportunity that supports

the development of industry-leading midstream solutions, said MarkWest Chairman, President

and Chief Executive Officer Frank Semple. The JV processing complex expands our footprint

into northern Ohio and complements our existing full-service midstream infrastructure in Ohio,

West Virginia and Pennsylvania. The planned joint venture Y-grade pipeline will be by far the

most efficient project for the Marcellus and Utica producers to access the Gulf Coast NGL

markets and is another critical step in support of our long-term objective of providing our

producer customers with multiple market options and maximum value for their natural gas and

natural gas liquid production.

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Forward-looking statements speak only as of the date they were made, and except to the extent

required by law, Kinder Morgan undertakes no obligation to update or review any forward-

looking statement because of new information, future events or other factors. Because of theseuncertainties, readers should not place undue reliance on these forward-looking statements.

MarkWest Cautionary Language:

This press release includes forward-looking statements. All statements other than

statements of historical facts included or incorporated herein may constitute forward-lookingstatements. Actual results could vary significantly from those expressed or implied in such

statements and are subject to a number of risks and uncertainties. Although MarkWest believes

that the expectations reflected in the forward-looking statements are reasonable, MarkWest can

give no assurance that such expectations will prove to be correct. The forward-lookingstatements involve risks and uncertainties that affect operations, financial performance, and

other factors as discussed in filings with the Securities and Exchange Commission (SEC).Among the factors that could cause results to differ materially are those risks discussed in the

periodic reports filed with the SEC, including MarkWests Annual Report on Form 10-K for theyear ended December 31, 2012 and our Quarterly Report on Form 10-Q for the quarter ended

March 31, 2013. You are urged to carefully review and consider the cautionary statements and

other disclosures made in those filings, specifically those under the heading Risk Factors.MarkWest does not undertake any duty to update any forward-looking statement except as

required by law.

CONTACTS:

Kinder Morgan:Media Relations Investor RelationsRichard Wheatley (713) 369-9490(713) 420-6828 [email protected][email protected] www.kindermorgan.com

MarkWest:Frank Semple, 866-858-0482Chairman, President & CEO

orNancy Buese, 866-858-0482Executive VP & CFOorJosh Hallenbeck, 866-858-0482VP of Finance & [email protected]

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mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.kindermorgan.com/http://www.kindermorgan.com/mailto:[email protected]:[email protected]:[email protected]://www.kindermorgan.com/mailto:[email protected]:[email protected]

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080713 - Kmp-mwe Utica Project Loi - Final