Vecino Energy and DRW Energy Trading Announce Agreement to Develop and Anchor South Texas Salt Dome Storage Project With Connectivity to Agua Dulce
Vecino Energy and DRW Energy Trading Announce Agreement to Develop and Anchor South Texas Salt Dome Storage Project With Connectivity to Agua Dulce:
January 21, 2025 08:30 AM Eastern Standard Time
SAN ANTONIO, Texas--(BUSINESS WIRE)--Vecino Energy Partners, LLC (“Vecino”), a portfolio company of EnCap Flatrock Midstream, and DRW Energy Trading LLC (“DRW”) have entered into a Memorandum of Understanding (“MOU”) outlining certain material terms and conditions supporting the development of the Piedras Pintas Salt Dome (“Piedras Pintas”) for intrastate natural gas storage service.
Upon final investment decision (“FID”) and execution of definitive agreements, Vecino will construct a greenfield hydrocarbon storage project on Piedras Pintas in Duval County, Texas. Vecino controls enough surface and mineral interests to develop both a gas and liquids storage business rivaling the premier facilities on the Gulf Coast with room for over 50 billion cubic feet (Bcf) of high-deliverability natural gas capacity, over 100 million barrels (Mmbbls) of liquids storage or a combination thereof. The Project will offer connectivity to Agua Dulce and be the closest salt dome storage to Corpus Christi, Brownsville and Mexico.
The project will be developed in multiple phases with Phase I consisting of two natural gas storage caverns, associated infrastructure and a newly-constructed 40-mile pipeline directly connecting the Project to the natural gas hub at Agua Dulce. Subject to FID and requisite approvals, Phase I natural gas storage caverns have anticipated in-service dates in 2028 and 2029.
DRW will serve as the anchor customer for the project, underwriting the gas caverns in Phase I. DRW, with its deep market expertise, will also play a key role in ensuring the project’s success as a major shipper and investor in the region. This project underscores DRW’s commitment to advancing energy infrastructure along the Texas-Mexico border and its strategic focus on providing innovative, market-driven solutions to the energy industry.
“We are pleased to work with the team at DRW on this exciting opportunity,” said Nelson Ferries, Vecino’s Executive Vice President of Origination. “Natural gas volatility continues to be a real challenge for producers, marketers and industrial users, and this facility is specifically designed to navigate those short-term market dislocations. Furthermore, we believe that natural gas and liquid storage at this location will help unlock further industrial development near Corpus Christi and Brownsville.”
“We believe this project presents an opportunity to help strengthen the energy infrastructure in this critical part of the United States, providing additional natural gas storage to spur future LNG development and strengthen the pipeline between the US and Mexico,” said Jonathan Harms, Managing Director of Energy Origination for DRW. “We see substantial new supply and demand coming to this area and we see no asset better positioned to help producers and consumers navigate the local market volatility.”
For customer inquiries regarding the availability of storage capacity, please contact David Ash, Vecino’s President, at (210) 569-6747.
For questions regarding DRW’s involvement, please contact Jonathan Harms, Managing Director of Energy Origination for DRW, at (832) 278-0517.
About Vecino Energy Partners, LLC
Established in 2022 and based in San Antonio, Texas, Vecino was founded by former executives and management of BlackBrush Oil & Gas, SemGas, BP and TexStar Midstream to focus on infrastructure development in support of the domestic oil and gas industry. Vecino leverages its team’s experience operating upstream, midstream and downstream assets to craft custom solutions for its industry partners. For more information, please visit www.vecinoenergy.com.
About EnCap Flatrock Midstream
EnCap Flatrock Midstream provides value-added growth capital to proven management teams focused on midstream infrastructure opportunities across North America. The firm was formed in 2008 by a partnership between EnCap Investments L.P. and Flatrock Energy Advisors, LLC. EnCap Flatrock Midstream is based in San Antonio with offices in Oklahoma City and Houston. Since inception, the firm has managed investment commitments of nearly $10 billion from a broad group of prestigious institutional investors. EnCap Flatrock Midstream is currently making commitments to new management teams from its latest flagship fund, EFM V. For more information, please visit www.efmidstream.com.
About DRW
DRW is a global trading firm with decades of experience across diverse markets and asset classes, including commodities, real estate, venture capital, and crypto assets. DRW Energy Trading, the firm's energy commodities marketing, logistics, and trading division, focuses on North American Power, Gas, and Emissions markets. The group leverages a talented team of meteorologists, engineers, data scientists, traders, and financial experts to address complex energy market challenges. Active in all major US Power and Gas markets, it manages a portfolio of assets that ensure critical supply and takeaway options in capacity-constrained regions. DRW provides supply and liquidity through both physical and financial markets, with a particular emphasis on the Western United States and the Texas-Mexico border.
Contacts
Kelly Kimberly / Nick Rust
FGS Global
kelly.kimberly@fgsglobal.com / nicholas.rust@fgsglobal.com
713.822.7538 / 917.439.0307
January 21, 2025 08:30 AM Eastern Standard Time
SAN ANTONIO, Texas--(BUSINESS WIRE)--Vecino Energy Partners, LLC (“Vecino”), a portfolio company of EnCap Flatrock Midstream, and DRW Energy Trading LLC (“DRW”) have entered into a Memorandum of Understanding (“MOU”) outlining certain material terms and conditions supporting the development of the Piedras Pintas Salt Dome (“Piedras Pintas”) for intrastate natural gas storage service.
Upon final investment decision (“FID”) and execution of definitive agreements, Vecino will construct a greenfield hydrocarbon storage project on Piedras Pintas in Duval County, Texas. Vecino controls enough surface and mineral interests to develop both a gas and liquids storage business rivaling the premier facilities on the Gulf Coast with room for over 50 billion cubic feet (Bcf) of high-deliverability natural gas capacity, over 100 million barrels (Mmbbls) of liquids storage or a combination thereof. The Project will offer connectivity to Agua Dulce and be the closest salt dome storage to Corpus Christi, Brownsville and Mexico.
The project will be developed in multiple phases with Phase I consisting of two natural gas storage caverns, associated infrastructure and a newly-constructed 40-mile pipeline directly connecting the Project to the natural gas hub at Agua Dulce. Subject to FID and requisite approvals, Phase I natural gas storage caverns have anticipated in-service dates in 2028 and 2029.
DRW will serve as the anchor customer for the project, underwriting the gas caverns in Phase I. DRW, with its deep market expertise, will also play a key role in ensuring the project’s success as a major shipper and investor in the region. This project underscores DRW’s commitment to advancing energy infrastructure along the Texas-Mexico border and its strategic focus on providing innovative, market-driven solutions to the energy industry.
“We are pleased to work with the team at DRW on this exciting opportunity,” said Nelson Ferries, Vecino’s Executive Vice President of Origination. “Natural gas volatility continues to be a real challenge for producers, marketers and industrial users, and this facility is specifically designed to navigate those short-term market dislocations. Furthermore, we believe that natural gas and liquid storage at this location will help unlock further industrial development near Corpus Christi and Brownsville.”
“We believe this project presents an opportunity to help strengthen the energy infrastructure in this critical part of the United States, providing additional natural gas storage to spur future LNG development and strengthen the pipeline between the US and Mexico,” said Jonathan Harms, Managing Director of Energy Origination for DRW. “We see substantial new supply and demand coming to this area and we see no asset better positioned to help producers and consumers navigate the local market volatility.”
For customer inquiries regarding the availability of storage capacity, please contact David Ash, Vecino’s President, at (210) 569-6747.
For questions regarding DRW’s involvement, please contact Jonathan Harms, Managing Director of Energy Origination for DRW, at (832) 278-0517.
About Vecino Energy Partners, LLC
Established in 2022 and based in San Antonio, Texas, Vecino was founded by former executives and management of BlackBrush Oil & Gas, SemGas, BP and TexStar Midstream to focus on infrastructure development in support of the domestic oil and gas industry. Vecino leverages its team’s experience operating upstream, midstream and downstream assets to craft custom solutions for its industry partners. For more information, please visit www.vecinoenergy.com.
About EnCap Flatrock Midstream
EnCap Flatrock Midstream provides value-added growth capital to proven management teams focused on midstream infrastructure opportunities across North America. The firm was formed in 2008 by a partnership between EnCap Investments L.P. and Flatrock Energy Advisors, LLC. EnCap Flatrock Midstream is based in San Antonio with offices in Oklahoma City and Houston. Since inception, the firm has managed investment commitments of nearly $10 billion from a broad group of prestigious institutional investors. EnCap Flatrock Midstream is currently making commitments to new management teams from its latest flagship fund, EFM V. For more information, please visit www.efmidstream.com.
About DRW
DRW is a global trading firm with decades of experience across diverse markets and asset classes, including commodities, real estate, venture capital, and crypto assets. DRW Energy Trading, the firm's energy commodities marketing, logistics, and trading division, focuses on North American Power, Gas, and Emissions markets. The group leverages a talented team of meteorologists, engineers, data scientists, traders, and financial experts to address complex energy market challenges. Active in all major US Power and Gas markets, it manages a portfolio of assets that ensure critical supply and takeaway options in capacity-constrained regions. DRW provides supply and liquidity through both physical and financial markets, with a particular emphasis on the Western United States and the Texas-Mexico border.
Contacts
Kelly Kimberly / Nick Rust
FGS Global
kelly.kimberly@fgsglobal.com / nicholas.rust@fgsglobal.com
713.822.7538 / 917.439.0307
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