Adding capacity to meet prolific growth while achieving
Completing projects on time and on budget
Field services continued to see volume growth and return on investments made in the Fayetteville and Haynesville shales. For the year, operating income was $189 million, compared to $151 million in 2010. Equity income from our 50 percent interest in a gathering and processing joint venture was $9 million, compared to $10 million the previous year.
Our recent contracts that provide minimum throughput commitments and/or rate of return guarantees will stabilize revenues and mitigate the impact of production volume reductions due to declining natural gas prices. In 2011, our margins grew by nearly 30 percent, primarily as a result of our extensive projects in the Haynesville and Fayetteville shales.
By year’s end, our total throughput was 2.6 billion cubic feet (Bcf) per day, an increase of nearly 30 percent over 2010. To accommodate that growth, we added nearly 100 miles of pipeline to our gas gathering systems, which now total nearly 3,900 miles. This provides our customers even greater reliability and operating flexibility.
We continued our ongoing capital investment in future growth opportunities, though at lower levels than in past years. At our Magnolia gathering system, which serves the Haynesville Shale, we placed into service an expansion project that added 200 million cubic feet per day (MMcfd). This brings our total Magnolia and Olympia contracted capacity to 1.5 Bcf per day.
Though a number of large projects are now substantially complete, we have smaller projects planned, such as expansions of our Elm Grove, Red Oak and Spiro facilities. We are also exploring additional opportunities in and around our footprint. We see some new revenue potential as well as opportunities to increase profitability through enhanced automation and improved operating efficiencies. We are testing new processes at our amine facilities that allow the system to remain in service during plant maintenance, which reduces downtime for customers and the cost of operations. Other upgraded technology applications will give us more timely and actionable information, which will provide us with greater daily optimization opportunities.
- $189 million in operating income
- $9 million in equity income from our 50 percent interest in a gathering and processing joint venture
- Total daily throughput increased nearly 30 percent
- Added nearly 100 miles of pipeline to our gas gathering system
- Expanded our treating and compression facilities that serve the Fayetteville, Haynesville and Woodford shales
CenterPoint Energy employees work around the clock at our Clear Lake compressor station in the Haynesville Shale. We will continue to capitalize on our competitive position for shale opportunities.
- Pursue new gathering and processing opportunities within and outside our current footprint
- Test new processes at our amine facilities that allow the system to remain in service during plant maintenance
- Provide greater daily optimization opportunities through upgraded technology applications