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September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern Delaware Infrastructure: Midstream Sector Responds to Drilling

Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

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Page 1: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

September 2, 2015

Hart Energy Midstream Texas Conference

October 26, 2015

Gary E. ConwayPrincipal, President & CEO

Southern Delaware Infrastructure:Midstream Sector Responds to Drilling

Page 2: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Upstream Investment in the Southern Delaware

842 Horizontal Wells as of January 2010

2,391 Horizontal Wells as of September 2015

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Page 3: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

2010 Midstream Infrastructure - Southern Delaware

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Delaware Basin Oil and Gas Infrastructure 2010

Page 4: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

2015 Midstream Response to Upstream Investment

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Delaware Basin Oil and Gas Infrastructure 2015

Page 5: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Waha Market Demand 7-9 BCFD

Presidio1.4 BCFD

San Elizario2.0 BCFD

Katy - LNG>0.5 BCFD

Metroplex0.5 BCFD

Midwest1 BCFD

Existing Demand

New Demand

Gulf Coast1.5 BCFD

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Page 6: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Source: El Financiero

Waha to San Elizario: 2.0 BCFD

Waha to Presidio: 1.4 BCFD

Waha Market Demand – Mexico is BIG Player

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Page 7: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Vaquero’s Answer to the Southern Delaware Basin Infrastructure Constraints

Currently under construction on a large gathering and processing system for rich gas in the Southern Delaware Basin with a new 200 MMSCFD Cryogenic plant, Amine Treating, Compression, Dehydration and Stabilization

Vaquero offers a high-quality, new-build system to provide higher plant recoveries, minimal downtime and lower fuel usage

System In Service Date: May 2016

• 100 Miles of 30” and 24” high pressure (700 – 1200 psig) trunk line with initial CDP pressures at approximately 750 psig traversing key rich gas regions of the basin

• Tailored UOP Russell (Thomas Russell) 200 MMCFD plant designed specifically for the new gas production seen in the Southern Delaware Basin

• Residue gas pipeline to the Waha market will connect producers TO AT LEAST 12 RESIDUE PIPELINES AND MARKETS

• Access to the Mexican gas market in late 2016 and 2017

• NGL pipelines connecting to the Mont Belvieu market

Expandable up to 4 total cryogenic trains (800 MMSCFD processing capacity)

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Page 8: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Vaquero Midstream Active Buildout

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Gathering Pipeline Capacity of 800 MMSCFD without powering up

Processing Capacity Initially at 200 MMSCFD expandable to 800 MMSCFD

Page 9: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

NGLs

Price Points UP

Vaquero Asset Solution

Vaquero Advantage NEW quality built

asset Put out the flares 800 MMSCFD

Capacity of Gathering at 750 psig – 1250 psig

Scalable Cryogenic Facility

BEST Market access Flow Assurance

NEED for Quality Performing Midstream

Infrastructure

GREATER Upstream

Investment

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Page 10: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Vaquero in the Delaware Basin: Caymus Processing Facility

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Page 11: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Vaquero in the Delaware Basin: Caymus Processing Facility

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Page 12: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Vaquero Midstream has assembled a team of strong industry professionals who have dedicated their

careers to bringing products to market safely, efficiently and cost effectively. The members of the Vaquero

team have served in both internal producer roles and external service provider roles, making us uniquely

specialized to best serve our producer partners.

Safety

Work Ethic

Fair Treatment

Reputation

Service

Loyalty

Respect

Commitment

DevelopingWilling Partnerships

Vaquero Culture

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Page 13: Southern Delaware Infrastructure: Midstream Sector …...September 2, 2015 Hart Energy Midstream Texas Conference October 26, 2015 Gary E. Conway Principal, President & CEO Southern

Gary E. Conway CEO/Principal [email protected] (972) 816-1475

William W. Davis Principal [email protected] (214) 478-3819

Bryant H. Patton Principal [email protected] (214) 686-0630

Brian W. Best

Brian D. Hiett

Brett M. Taylor

Justin C. Bennett

EVP of Business Development

Sr. Director of Business Development

Director of Gas Supply

Director of Business Development

[email protected]

[email protected]

[email protected]

[email protected]

(214) 502-8713

(214) 213-6855

(972) 215-6409

(979) 777-6319

Vaquero Contacts

HOUSTON OFFICE1790 Hughes Landing Blvd.Suite 475The Woodlands, Texas(281) 501-5699

DALLAS OFFICE2602 McKinney AvenueSuite 315Dallas, Texas(214) 855-5546

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PERMIAN OFFICE125 East 42nd StreetMonahans, Texas