November 25, 2009 • Volume 2, No. 17 MIDSTREAM NEWS Serving the marketplace with research, insight and transaction opportunities

Acadian’s Haynesville Extension connects Northwest La. Valerus Compression gets 249 miles of ~1.4 BCFD pipeline connect to Haynesville producers $500 MM investment Acadian Gas LLC , which is jointly owned by Duncan Energy Partners LP and Enterprise Valerus Compression Services has Products Partners LP , will extend its Louisiana intrastate pipeline into Northwest Louisiana. This received a $500 million debt and equity invest - will provide producers in the Haynesville Shale play with better market access through Acadian’s ment from TPG Capital . existing 1,000-mile system in South Louisiana, and through nine major interstate pipelines as well. Chet Erwin will continue as As designed currently the project will have a transport capacity of ~1.4 CEO. Dan Smith, board chairman BCFD via a 249-mile, 36-inch and 30-inch pipeline connecting Acadian’s cur - of Kraton Polymers and the former CEO of rent system and its affiliated Cypress Gas Lyondell Chemical Co. , until its acquisition Pipeline. The Haynesville Extension might be Intrastate Acadian pipeline connects by Basell in 2007, will become chairman. increased to 2 BCFD – if additional long-term coastal system with Haynesville shale “TPG’s involvement is a critical step commitments were received before pipe in the evolution of the company. The orders were placed. The extension will be brought on stream in September 2011. partnership will support our domes - The existing Acadian system has access to more than 150 end-use markets along the tic growth trajectory and help us take advan - Mississippi River corridor between Baton Rouge and New Orleans, and includes a rapid- tage of significant international opportuni - cycle salt dome storage cavern; the system also has the ability to make physical deliver - ties,” Erwin said. ies into Henry Hub. ACADIAN continues on page 8 Valerus Compression is a privately held gas and equipment company that delivers Enbridge’s LaCrosse Pipeline takes Texas gas to coastal La. reciprocating and rotary gas compressor Open season held for 340-miles with >1.3 BCFD indicated packages, production equipment, gas pro - From November 13 to 23, Enbridge Inc. held a binding open season for its LaCrosse cessing solutions, liquid separation systems Pipeline designed to transport gas from Carthage, Texas, to multiple delivery points in and field services. Southeastern Louisiana. The proposed project consists of 340 miles in two phases. For phase one, Cash injection comes from same group Enbridge will build and bring on stream the 42- and 36-inch segments from its that took TXU private. Carthage Hub to Point Coupee Parish, La., and a 24-inch segment extending from Point Coupee Parish to Petrologistics LLC’s “We firmly believe that Valerus is poised Choctaw Storage facility in Iberville Parish. Project follows shale producers’ demand to benefit from the continued development of In phase two, the project will build and bring for pipe America’s natural gas resources and the into service the pipeline segment from Point growth in gas production from the country’s Coupee Parish, La., to an interconnection with Southern Natural Gas Co. in Washington Parish. prolific shale plays. Valerus is also uniquely The planned service dates will be phased in to meet customer needs beginning January 2012 positioned to help its customers capitalize through March 2013.“We are in the process of negotiating third party agreements that will bring total upon increased natural gas production inter - capacity commitments to exceed 1 BCFD, and have additional indications of interest that could nationally,” said TPG Partner Michael exceed 1.3 BCFD,” said Enbridge President Terrance McGill. ENBRIDGE continues on page 4 MacDougall. “We look forward to partnering with the management team to help it pursue the company’s next phase of growth.” EnCap, Flatrock & TPH form Meritage Midstream TPG Capital is the global buyout $150 million equity aimed at Eagle Ford Shale group of TPG, a leading private investment EnCap Energy Investments , Flatrock Energy Advisors , and TPH Partners have firm with about $45 billion of assets under formed Meritage Midstream Services with equity of about $150 million. The new company management. VALERUS continues on page 14 will provide O&G producers with a full battery of midstream services such as gathering, treat - FEATURED LISTINGS ing and handling gas, crude, condensates and water, as well as CO 2 sequestration. Meritage will be led by Steve Huckaby, Nick Thomas, Bill Dickey and Tim Pimmel, and will be headquartered in Golden, Colo. — though the company will reportedly focus TULSA CO., OK GATHERING SYSTEM on the emerging Eagle Ford Shale ShutIn Pipeline With Equipment. 10 Sq Miles. play in South Texas. Meritage is one of several new shale OKLAHOMA SYSTEM “We see significant long-term growth play companies Significant CBM Exploration Within potential and look forward to working with Acreage. Meritage to grow the business through their extensive industry contacts,” said Flatrock Shallow Coal Seam Gas Production. President Bill Waldrip. “By combining the expertise in midstream and private equity at Low Pressure-Stripper Plant-Sales Lines. CBM Flatrock and EnCap with the strategic market capabilities at TPH and the experienced team at 100% OPERATED WI FOR SALE PIPEONLY Meritage, we have formed one of the best combinations in the midstream business.” ShutIn Pipeline: Raw Unleased Acreage Suitable To: Production & Pipeline Buyer Meritage’s president, Steve Huckaby, says the deal has rendered a strong shale player. Optimal Scenario: Buy Pipeline & Drill “Meritage Midstream is led by a seasoned team of midstream executives with proven track records SELLER HAS SOLID RIGHT OF WAYS of success and value creation,” said Huckaby. “Our partnership with EnCap and TPH creates a for - G 5617PL midable company with the ability to respond quickly to rapidly developing resource plays.” ENCAP continues on page 11 All Standard Disclaimers & Seller Rights Apply. MIDSTREAM NEWS Wednesday, November 25, 2009 2

Midstream News Welcome to PLS’ How To Use MidstreamNews , a tri-weekly report on Shale and gas infrastructure keeping midstream interesting gathering, purchases, pipelines, mergers, acqui - The midstream energy sector is benefiting from the storm clouds surrounding North sitions, capital and performances in the mid - American natural gas. stream marketplace. In addition to the news, the Regarding the gas markets, lower demand and large shale resources are changing report also carries listings of property (PP), over - the playing field. Adding to the storm, producers are still reeling from the aftershocks of ride (RR) and midstream (G) assets for sale, along with lands (L) and prospects (DV). last year’s market crash, and capital remains too wintry for many investor’s tastes. Midstream players, however, are safe in the eye in the storm. New build infrastructure Anonymous listings are coded alpha-numerically. is running at a record pace — primarily that which brings shale gas to market, as many Clients interested in accessing only listing - E&P operators seek firm transportation to ensure their gas gets to market. package information call (or email) PLS and provide the listing codes. The last leg of the 1,679-mile Rocky Mountain Express , or REX, is finished and came on-stream November 12. The REX, stretching from northwestern Colorado to eastern Ohio, Besides the MidstreamNews , PLS publishes a has had interesting effects on the historical regional inter-market dynamics, particularly monthly recap of the e&p market in the among the U.S. Northeast, Mid-Continent, and Canadian and Upper Midwest regions. Prospects & Properties and a&d market recaps in the A&D Transactions . In this edition of MidstreamNews , Duncan Energy Partners and Enterprise Products Partners team up to build infrastructure in Louisiana to better accommodate the Additional products details can be obtained Haynesville shale; and Enbridge moves to hook up ~1.3 BCFD of East Texas gas to by visit our website at www.plsx.com . coastal Louisiana. And what a gas! But not for gasoline — Valero will permanently close its 217,000 BPD Delaware City, Del. refinery, A.S.A.P, announced on November 20. Valero cited losses due to collapsed demand and prices among the reasons for closing the large plant. MIDSTREAM NEWS A much smaller refinery, in Bloomfield N.M., was recently shuttered by Western Refining — also citing precipitous losses, in contrast with the huge domestic refining profits of one year ago, when U.S. refineries were operating at 105%. PLS, Inc. P.O. Box 4987, Houston, TX 77210 Nevertheless, Gulf of Mexico production is moving forward, as Petrobras is delivering Phone: (713) 650-1212 the first FPSO, slated for the Cascade/Chinook fields, with a storage capacity of ~600,000 bbl. Fax: (713) 658-1922 And in spite of growing fears about investors remaining reluctant for too long, some Website: www.plsx.com savvy investors are nevertheless putting dollars to work, investing in gas infrastructure and production — particularly in the shales. In this edition of MidstreamNews , EnCap , Managing Director of Research Flatrock and TPH form Meritage Midstream with $150 million aimed at the Eagle Ford Brian Lidsky - [email protected] shale; and Valerus Compression announces a $500 million capital injection from TPG Editor Capital , also with an eye on shale development. Gentry Braswell - [email protected] Listings — By Gentry Braswell, MidstreamNews editor Ross Benoche - [email protected] Graphic Design Lisa Armstrong - [email protected] A&D News Advertising Beau Kelley - [email protected] Foster Wheeler buys Atlas Engineering Client Services The Switzerland-based company’s global engineering and construction group purchased Ali Rizvi - [email protected] the majority of Atlas Engineering Inc. ’s assets, for undisclosed terms. Atlas Engineering is a Publishing & Conferences Advisory Board Houston-based firm engaged primarily in engineering design, project and construction man - Doug Jacobson, Chesapeake Energy Corp. agement services for upstream oil and gas production and processing. John Gargani, Southwestern Energy Co. The move is part of Foster Wheeler ’s objective to Robert Turnham, Goodrich Petroleum Corp. increase its technical capabilities and expand its global platform. “With its focus on ‘top-side’ M. Lynn Bass, GasRock Capital, LLC design and engineering, Atlas offers a natural complement to the subsea/pipeline expertise we Cathy Sliva, BlueRock Energy Capital, LTD Frank Pottow, Greenhill Capital gained with the first-quarter 2009 acquisition of the offshore engineering division of OPE Adrian Goodisman, Scotia Waterous Holdings Ltd.,” according to a Foster Wheeler statement. Alan Smith, Quantum Resources Management Foster Wheeler AG’s Global Engineering and Construction Group designs and constructs David Marchese, Haddington Ventures, LLC leading-edge processing facilities for the upstream oil and gas, LNG and gas-to-liquids, refin - ing, chemicals and petrochemicals, power, To obtain additional information on properties for environmental, pharmaceuticals, biotechnol - Swiss company cites Atlas’ expertise as sale in this MidstreamNews , please contact our listing ogy and healthcare industries. The company’s complimentary to Foster Wheeler’s dept: (713) 650-1212 or by fax: (713) 658-1922 with the property number. Please note only clients are able to re - Global Power Group is a world leader in com - subsea/pipeline designs. ceive additional information. bustion and steam generation technology that The MidstreamNews newsletter is published every three designs, manufactures and erects steam generating and auxiliary equipment for power stations (3) weeks by PLS, Inc. and industrial facilities. “Combined with the existing resources of Foster Wheeler, we will be able to execute © Copyright 2009 by PLS, Inc. larger and more complex projects and have access to clients on a global basis,” said Chris Federal copyright law prohibits unauthorized Vrakas, who has served as president of Atlas and who now joins Foster Wheeler in a leadership reproduction by any means and imposes fines up to role. “Joining Foster Wheeler enables Atlas to grow our business within existing and new mar - $100,000 for violations. kets without compromise to the high quality services we provide to our current client base.” www.plsx.com Call PLS To Place Your Listing: (713) 650-1212 3 Wednesday, November 25 , 2009 MIDSTREAM NEWS

Valero mothballing 210,000 BPD Delaware City refinery Note from Brian Lidsky– Managing Director of Research Valero Energy Corp. announced As PLS has reported, infrastructure build out for North America gas is running at a November 20, it will permanently shut down its record pace. Midstream companies are working diligently with producers to provide 210,000 BPD Delaware City, Del. refinery cit - needed access from growing supply areas to markets. This market is attracting capital and ing “financial losses caused by very the gas pipeline sector recently took top spot for equity performance with current yields poor economic conditions, signifi - for the MLPs in the 7% range. The final build out of the REX pipeline has certainly had a cant capital spending requirements and high market impact with basis differentials for Rockies and Mid-Continent gas dropping to the operating costs…a safe and orderly shutdown 30¢ range versus $2.50 a year ago. of the refinery will commence immediately.” For perspective on commodities, as of market close November 24, the 12 month gas strip Valero says it will continue to provide is $5.24 (vs. year ago $6.74) and the oil strip is $80.14 (vs. year ago $56.66). Spot gas is $3.64 reliable supply for its customers, partially and spot oil is $74.92. In Canada, spot gas is C$3.84 and the strip is C$5.10 (year ago C$7.35). through higher throughput rates at the com - LNG intake facilities remain in various stages of commitments – the latest player being pany’s other refineries. “Earlier this year, we Hess and JV partner, Poten & Partners , who are focused on the Northeast coast. A Gulf shut down the gasifier and coking operations Coast LNG terminal in Lake Charles, La. was officially dedicated October 21 and on the in an attempt to improve reliability and finan - West Coast, developers are gearing for an Oregon facility. cial performance, but the refinery’s prof - On the oil side, domestic refiners are having a difficult time. According to the EIA’s 3Q itability did not improve enough,” Valero 2009 report on Major Energy Companies, domestic throughput is running fine at 10.8 CEO Bill Klesse said. Klesse also said Valero MMbbls/d (vs. 10.7 MMbbls/d in 3Q 2008). However, the story driving actions are the fact had sought a buyer for the refinery “but fea - that gross refining margins nose-dived 77% to $4.22/bbl (vs. $18.22/bbl in 3Q 2008 and a sible opportunities have not materialized.” five-year average of $20.61/bbl). These sorts of numbers and associated losses are resulting in permanent refinery shut-downs – witness Valero’s shuttering of its 210,000 b/d Delaware 1.5 MMBPD of U.S. capacity could close City refinery. Interesting how quickly market conditions change – given that just over a year in near future. ago, refineries were running at full capacity, gasoline prices were high, and the sentiment was focused on the decades-long hiatus for the country building of a new refinery. Similarly reflecting the effects of the PLS recently attended a presentation by Doug Foshee, Chairman of El Paso Corp. Mr. market dive over the last year on refiners, Foshee provided a powerful and fact-based overview of the U.S. energy markets. With Western Refining Inc. plans to close its electricity at the center of the energy future, given regulations, policies and objectives of 17,000 BPD refinery at its Bloomfield N.M., all constituents, Mr. Foshee made a strong case for natural gas becoming the lead in the refinery, and will consolidate its operations energy future of the country – outpacing coal despite the common nomenclature and with Western’s 23,000 BPD plant in Gallup great PR campaign claiming “clean coal.” at an anticipated mostly non-cash pre-tax PLS wishes all our clients and families a happy, safe and healthy Thanksgiving. charge of about $55 to 65 million in this quar - ter, and anticipated savings of about $25 mil - lion/year starting Q1 of 2010. Western’s A&D News crude throughput will not be reduced. Last month Sunoco idled its 145,000 MasTec inks deal to buy Precision Pipeline LLC for $150 MM BPD Eagle Point refinery in Westville, N.J. A MasTec Inc. signed a definitive agreement to by Precision Pipeline LLC for a consid - Marathon Oil spokesman said recently that eration of $150 million, subject to certain price adjustments and an earnout. 1.5 MMBPD of U.S. refining capacity could Precision is a leading gas, crude and refined products transmission pipeline infrastructure in the near future potentially be closed. services provider in North America, based in Wisconsin. They specialize in con - In Q4 2009, Valero expects to report a struction and maintenance of large diameter pipelines with experience in the pre-tax charge of about $1.7 to $1.8 billion long-haul interstate pipeline industry. for shutdown costs. Valero estimates the shut - The acquisition is expected to compliment MasTec’s existing gas gathering systems, pro - down will reduce pre-tax operating expenses cessing plants and compression stations and midstream pipelines. by about $450 million. Valero had 2008 rev - Precision generated $303 million of revenue in 2007 and $507 million in 2008. enues of $119 billion; it is the largest North “With the acquisition of Precision, we will significantly expand our capabilities in the American refiner, owning and operating 16 natural gas, crude oil and refined petroleum product pipeline industries, which we believe will refineries with a throughput capacity of about be solid areas of growth for years to come,” said MasTec CEO Jose Mas. “MasTec continues 3 million b/d. to generate significant cash flow from its existing operations…” Western owns ~250 miles of crude gath - ering lines, and Bloomfield and Gallup oper - RedHawk buys Xxtreme tubular services for $66 million ations process mostly locally produced natu - RedHawk Energy Corp. has bought all membership interests of the Texas-based ral gas and light sweet crude. A 128,000 BPD Xxtreme Pipe Services LLC , Xxtreme Pipe Storage LLC , Xxtreme Tubular Processors refinery in El Paso and a 70,000 BPD refin - LLC and Wolf Pack Rentals LLC , for $66 million. ery in Yorktown, Va. are also operated by Xxtreme Group is a provider of oilfield services such as ultrasonic inspection, Western. The company reported a Q3 2008 storage and API threading and processing of Oil Country tubular goods. profit of $109.2 million, and a Q3 2009 loss “We believe market conditions are favorable for selective, strategic energy sector of $4.8 million. Western’s year over year in acquisitions of businesses with strong management teams and a good track record through these dif - Q3, revenue fell 40% by $1.9 billion. ficult and challenging periods. We are positioning RedHawk with a solid financial and operational foundation to capitalize upon various strategic growth opportunities as they arise if market condi - Data Room & Document tions stabilize over the next 12 to 24 months,” said RedHawk founder Darcy Klug. Conversion Services RedHawk focuses on investments in and the consolidation through acquisition of domes - www.plsx.com tic oil and gas equipment manufacturing, leasing and service companies. MIDSTREAM NEWS Wednesday, November 25, 2009 4

A&D News MIDSTREAM ASSETS U.S. Infrastructure pays $21.7 MM for Gastar’s East Texas system ATASCOSA CO., TX PIPELINE Gastar Exploration Ltd. sold its majority interest in the Hilltop Resort Gathering H2S (Sour Gas) Pipeline. ±13-Miles. System for $21.7 million to U.S. Infrastructure LP . SOUTH PLEASANTON TO FASHING The gathering system consists of 20 miles of gas pipeline connected with 24 Gastar-oper - Outer Diameter: 6.625’’ ated wells producing in East Texas from the lower and middle Knowles and Bossier formations. Inner Diameter: 6.0’’ “The sale of our stake in the Hilltop system provides an attractive return on our Design Pressure: 2,282 psi PIPELINE investment and additional liquidity to GROUND FLOOR OPPORTUNITY pursue our drilling plans in East Texas The Hilltop Resort Gathering System is Capacity: ±25,000 MCFD Only H2S Line In Area. and the Marcellus Shale, while maintaining a connected with 24 Gastar wells in East Emerging Eagle Ford Activity In Area. very low level of leverage,” said Gastar CEO Texas in the lower and middle Bossier and CONTACT SELLER FOR DETAILS Russell Porter. “We have a longstanding and Knowles formations. G 2907PL successful relationship with the principals of USI, and we look forward to continuing to build on this strategic affiliation as they become our EAST TEXAS GATHERING SYSTEM new gathering partners.” 8-Mile Gas Pipeline. Gastar Exploration is an E&P focused on North America gas assets. The company owns MARSHALL/HARRISON AREA and operates exploration and development acreage in the deep Bossier gas play off East Texas Near Penn Virginia Well. and Marcellus Shale play in West Virginia and Pennsylvania. The company has coalbed MultiPay East Texas Reservoirs. methane activities are conducted within the Powder River Basin of Wyoming. Cotton Valley, Travis Peak. Haynesville Development Possible. Pipeline Capacity: 10,000 MCFD PIPELINE Enbridge’s LaCrosse Pipeline CONTINUED from page 1 Multiple Line Right-Of-Way. Information received during the binding open season will be applied to finalize design High Pressure Line. and final capacity for the project. Interconnects w/ Two Main ETX Lines. SUBJECT TO PRIOR SALE “We have also secured engineering and environmental firms and survey permission CONTACT SELLER FOR MORE INFO from more than 80% of affected landowners. “We are moving forward to initiate regulatory G 1425PL approvals including application to U.S. Federal Energy Regulatory Commission, and expect to place Phase 1 of the LaCrosse Pipeline in service during the first quarter of 2012,” LAMPASAS CO., TX PIPELINE McGill added. 18-Miles Pipeline Project Needed. Information received during the binding open season will be used to finalize design and final COPPERAS COVE capacity for the proposed project. Capacity for those parties who have already executed precedent Right Of Ways Currently Being Obtained. agreements will be preserved under those agreements and will not be subject to allocations. Completion Expected By Year-End 2009. SEEKING PROJECT PARTICIPANTS 100% WI Possible For Pipeline. Active w/ New Production. Enbridge North American Gas Asset Positioning Needs Max Capacity: 12 MMCFD PIPELINE Potential Cash Flow: $270,000/Mn PROJECT Proved Reserves In Area. Operator Has Drilling Plan—- —-Needs Pipeline Development. GENERATOR HAS MORE INFO G 6389PL HAYNESVILLE CADDO PH., LA MINERALS SALE 194.58-Total Net Mineral Acres. HAYNESVILLE POSITION Located On 2-Contiguous Tracts. HAYNESVILLE Minerals Are 100% UnLeased. MINERALS CONTACT SELLER FOR MORE INFO M 2125 SHELBY CO., TX MINERALS SALE 2-Tracts Of Land. ~83-Acres. Great Haynesville Position.. All Minerals Rights. No Limitations. Offset To Tracts - Great Gas Production. 1 Of Tracts Leased To CHK. HAYNESVILLE 3-Yr Term Began Last Year. 2-Yr Option. MINERALS Seller Has Set Asking Price. SELLER HAS MORE DETAILS M 2561 Source: Enbridge Day Investment Community Conference 2009 www.plsx.com Call PLS To Place Your Listing: (713) 650-1212 5 Wednesday, November 25 , 2009 MIDSTREAM NEWS Midstream/Marketing Hamm to take Hiland private in $159 million merger 1.2 BCFD-capacity deepwater port offshore Florida approved Affiliates of Harold Hamm are taking Port Dolphin Energy LLC has filed for a license pursuant to the Deepwater Port Act of Hiland Partners LP and Hiland Holdings 1974 and the U.S. Coast Guard’s regulations to construct, own and operate a deepwater port off GP LP private. Hiland Partners has a market Tampa Bay in Florida. The unloading portion of the deepwater port, named Port Dolphin, would cap of ~$92 million. Hiland Holdings’s mar - be located in federal waters 28 miles offshore from Tampa Bay in around 100 feet of water. ket cap is ~$67 million. Construction of this project has been approved by the U.S. government. Port Dolphin Hiland Partners’ common Energy, a subsidiary of Norwegian shipping company Hoegh LNG, will provide employment shareholders will get $10 per unit; and training opportunities to American mariners on ships using the port. Hiland Holdings common shareholders will The Port Dolphin facility will deliver ~400 MMCFD to Florida, with a peak delivery receive $3.20 per unit. Hamm also agreed to capacity of 1,200 MMCFD. Construction will begin early 2013, and operations later that year. lend $1.5 million to Hiland Holdings per the agreement. Hiland Holdings GP LP owns the Petrobras bringing first GOM FPSO to Cascade/Chinook fields 2% general partner interest, 2,321,471 com - Singapore’s Keppel Shipyard Ltd. is on track to deliver the first floating production stor - mon units and 3,060,000 subordinated units, age and offloading vessel to the Gulf of Mexico, to BW Offshore affiliate, BW Pioneer Ltd. as well as the incentive distribution rights. The BW Pioneer will be turret-moored at a water depth of about 2,600 meters. The Pioneer’s Hiland Partners is a publicly traded mid - fabrication is nearly complete and has been leased by Petrobras America Inc. to operate in the stream energy partnership engaged in pur - Cascade and Chinook fields, with production scheduled for Q1 2010. The rig is designed chasing, gathering, compressing, dehydrat - to handle harsh GOM operating conditions, equipped with an internal disconnectable sub - ing, treating, processing and marketing of merged turret production mooring system and outfitted with advanced safety features to natural gas, and fractionating, or separating, withstand environmental loads from currents, waves and wind. In the event of approaching hurricanes, and marketing of LNG. this FPSO can disengage from the site and move on her own propulsion to seek sheltered waters. Hiland Partners operations are primarily It has a storage capacity of ~600,000 bbl, a process capacity of 80,000 BOPD and gas located in the U.S. Mid-Continent and Rocky export facilities of 16 MMSCFD. Mountain regions. Hamm founded the prede - Previously this year Keppel delivered the Cidade de Sao Vicente FPSO to BW Offshore cessor company to Continental Resources in for the Tupi deepwater field. 1967, and later expanded the company into the Rocky Mountains — first into the Red River Units of Montana and the Dakotas, then into the Increase Deal Flow & Business Opportunities: For subscription details call 713.650.1212 Bakken Shale in Montana and North Dakota.

STONEHENGE is a asset-backed midstream company that offers considerable engineering, operating and financial resources that can be applied to the midstream needs of natural gas producers.

Our mission is to support customers in the production of natural gas and natural gas liquids by: • Maximizing the value received for the produced gas • Responding quickly to new facility needs • Maintaining industry-best online times • Maintaining an inventory of processing equipment to accelerate project development We have technical and financial backing from three proven companies: • Energy Spectrum Capital, a leading private equity firm • Kahuna Ventures, a full-service midstream engineering consulting firm • Kahuna Operating, a midstream facility operator

Chuck Wilkinson , President Direct: 720-889-9933 [email protected] Richard Carl , Director, Business Development Direct: 720-889-9953 [email protected] Mike Brinkmeyer , Director, New Ventures Direct: 720-889-9940 [email protected] www.StonehengeEnergy.com

PLS Fax: (713) 658-1922 www.plsx.com It’s clear that if every buyer knew every Access Points For Buyers: The seller and every seller knew every • One-stop-shop buyer -everyone in the “market” • Immediate market access Industry’s would be able to make fully-informed • Custom Size/Area Profile decisions and industry opportunities • Simple & easy to use • Cost effective would be distributed more efficiently. Multiple • Searchable database So goes the multiple listing concept. • Web Accessible 24/7 Listing • No commissions At PLS, we’ve been proving this thesis Service for years through our producing Access Points For Sellers: property, prospect, mineral/lease, and • Easy to use A central access point for • Flexible service royalty listings. In fact, since 1988 buyers and sellers • Web Accessible 24/7 we’ve introduced thousands of • Immediately generate new buyer leads buyers and sellers, been responsible • Supplements any internal sales effort for hundreds of sales and better yet, • Control supporting documents initiated thousands upon thousands • No commissions of new business relationships. • Ability to upgrade exposure

Laurie Lewis Director of Listings (713) 650-1212

[email protected] www.plsx.com 7 Wednesday, November 25 , 2009 MIDSTREAM NEWS

HAYNESVILLE El Paso sees gas, not coal, for U.S. future Though not the sole solution to America’s energy future, gas will play a strong and impor - SHELBY CO., TX PROSPECT tant role in piecing together the puzzle, said El Paso Corporation CEO Doug Foshee, who 1,022-Gross & 805-Net Acres. spoke October 29 at Rice University’s Energy Finance Summit 2009 held by the Jones HAYNESVILLE SHALE Graduate School of Business. Significant Haynesville Position. “Consumer preference in the future is largely going to be shaped by policy,” No Depth Limitations. Foshee said, noting that policy dialogue tends to be centered about two goals — 4-Active Wells Contiguous To Prospect. energy independence and supply security. Foshee quickly extricated one of those from the conversa - Seller Will Deliver 75% NRI. HAYNESVILLE tion — “There is no such thing as energy independence. What we should focus on is supply security.” Seller Has Set Asking Price. In terms of import/export ratio, the United States is upside down with oil. We are a net Est Drilling Cost: ~$1,000,000 CONTACT GENERATOR FOR INFO worldwide exporter of coal. And with natural gas, regionally concentrated and loosely con - DV 2560L nected by LNG assets throughout North America, we are almost self-sufficient, Foshee said. Utility companies have some memories of suffering high natural gas prices and market volatil - EAGLE FORD ity. Therefore, they may question growing toward more gas-based power in the United States. Coal is also abundant, domestic and cheap — but it won’t be anymore, if greenhouse gases become reg - ATASCOSA CO., TX PROSPECT ulated — and that will happen, Foshee said: “Greenhouse gas regulation is coming.” 12,000-Acres. Natural gas is a “bridge fuel to a carbon - EAGLE FORD SHALE less fuel base” in contrast with coal technolo - El Paso Corp. CEO Doug Foshee talks On Trent w/ EOG Wells. gies, at a time when electricity demand is about energy and change in the 21st century Central & South East Central EAGLE growing, he said. Information and consumer Seller Can Deliver 75% NRI FORD electronics are now responsible for 15% of domestic market demand, and that is expected to FIELD HAS ONGOING DEVELOPMENT triple by 2030. And electricity is becoming more and more a source for transportation, with L 4802DV applications for condensed and liquid natural gas increasing. EAGLE FORD SHALE PROSPECT Foshee mentioned the natural gas value chain with respect to jobs as well as U.S. supply security 8-Potential Wells. 633-Acres. and greenhouse gas regulation, and that red and blue states can find common ground in gas. “There LA SALLE CO., TX are a lot of states who think they are coal states but are gas states, or are becoming gas states,” he HAWKVILLE FIELD said. “And, that is the sense of what I believe today is a pretty titanic struggle inside the beltway.” Proposed Depth: 10,000 Ft. Industries such as rail and coal producers are less excited about prospects of GHG regu - 1-Contiguous Lease Block. lation or any shifting of the U.S. energy grids from coal to gas, to be sure. But El Paso sees all Great 5’’ Log - Eagle Ford Section On Lse. of this as inevitable and unavoidable — considering the historic trends of ever-cleaner burning 100% OPERATED WI; 75% NRI EAGLE fuels and need-based changes from solid- to liquid- to gas-based stocks. Est Reserves/Well: 5.0 BCF FORD “We believe greenhouse gas regulation is coming, and we are actually an advocate of Est Well Costs: $4.0MM - $5.0MM greenhouse gas regulation at the federal level,” Foshee said. “We need to give legislators, who CALL PLS TO LEARN MORE are otherwise unopposed to natural gas, facts they can use.” DV 2555 Otherwise, for a company such as El Paso which does business in 38 states, accommo - LA SALLE CO., TX ACREAGE dating so many different state GHG regulators would be a “nightmare,” Foshee said. And in 32-Potential Wells. 2,625-Acres. addition to GHG regulation, more and more states are bringing forth reusable portfolio stan - EAGLE FORD POSITION dards. “It’s going to be death by 1,000 cuts,” Foshee said. EL PASO continues on page 9 Obj 1: Eagle Ford Shale. 6,000 Ft. Obj 2: Austin Chalk. 5,500 Ft. Pipeline Through Acreage. Electric Fuel Scorecard 100% OPERATED WI; 75% Lease EAGLE Est Reserves/Well: 5.5 BCF FORD Est Completed Well: $4MM - $5MM Resource CALL PLS FOR MORE INFO Impact Gas Coal Nuke Solar Wind DV 2573 Fuel Cost - + + + +

Air - - + + +

Capital + - - - -

Land + - - - - Property Tax Appraisals Property Tax Appeals Water + - - + + Due Diligence Reviews Purchase Price Allocations Operations + - - - - Independent Appraisals Time + - - + +/- Sales & Use Tax Reverse Audits Operations ? -/ ? + + +

Kevin Jones • [email protected] Source: El Paso 469-298-1594 • www.keatax.com

PLS Fax: (713) 658-1922 www.plsx.com MIDSTREAM NEWS Wednesday, November 25, 2009 8

Acadian’s Haynesville Extension CONTINUED from page 1 MARCELLUS The extension project will have two Acadian interconnects, in Pointe Coupee and Assumption parishes, and two Cypress interconnects, in Pointe Coupee and West Baton Rouge MARCELLUS SHALE LEASE parishes. The extension will also have interconnects with Florida Gas , Texas Eastern , 414-Acres. Transco , Sonat , Columbia Gulf , Trunkline , ANR , Tennessee Gas and Texas Gas . ARMSTRONG CO., PA Along with the existing capacity of the Acadian systems, the project will provide Acadian Right In The Heart Of The Play. Gas with about 5.5 BCFD meter capacity into an estimated 12 BCFD of available downstream Lease Available Due To Pugh Clause. pipeline takeaway capacity – initially connecting to nine Haynesville producer locations in Surrounded By Producing Wells. MARCELLUS DeSoto and Red River parishes. Also as part of the project, Acadian expects to construct two Lease HBP To Only 6,000 Ft— LEASE —Ground Floor Investment Opportunity compressor stations with about 67,000 HP combined. ACREAGE COSTS WAY BELOW MARKET CALL PLS FOR INTRO TO SELLER Midstream/Marketing L 5472 KMP and Copano to provide 350 MMCFD Eagle Ford pipeline WEST VIRGINIA PACKAGE 50/50 JV to bring new Eagle Ford shale gas to market 2-Wells. ~66,000-Net Acres. Kinder Morgan Energy Partners LP and Copano Energy LLC have entered a letter of MULTIPLE COUNTIES intent for a 50/50 joint venture to provide gathering, transportation, and processing services to Leadmine & Smokey Hollow gas producers in South Texas’ Eagle Ford Shale play. Oriskany & Tuscarora Production. The first phase is planned as a 22-mile, 24-inch gathering system, Considerable Marcellus Potential. originating in LaSalle Co., Texas, and terminating in Duval Co., Texas. Various ReCompletion Opportunities. The initial capacity is 350 MMCFD. The pipeline is expected to be completed by mid-next year. ~30 Miles of 3-D Seismic Shot. MARCELLUS Production: 800 MCFD “This new alliance will provide seamless Marathon Currently Drilling Nearby. bundled gathering, processing and transmis - JV capitalizes on promising Eagle Ford 29-Miles of Pipeline In Place. sion service to Eagle Ford Shale producers play midstream infrastructure CONTACT LANDMAN FOR MORE INFO through the combination of our companies’ PP 3674DV immediately available pipeline and processing capacities,” said Kinder Morgan’s Texas Intrastate Pipelines President Tom Martin. “This new pipeline is the first step to expand our Transport/Pricing Briefs combined network in support of Eagle Ford Shale development.” Vector Pipeline LP is holding a binding open KMP is a leading pipeline transportation and energy storage company in North America, season for shippers in a third system expansion. owning an interest in or operating more than 28,000 miles of pipelines and 170 terminals; the Binding bids for firm capacity are accepted from company has an enterprise value of about $25 billion. November 2 until 4 p.m. on November 30. The Copano is a Houston-based midstream gas company operating in Oklahoma, Texas, 2011 Expansion proposes adding long-haul Wyoming and Louisiana, with assets of 6,200 miles of gathering and transmission, 200 miles capacity of up to 115 MMCFD in the U.S. portion, and possibly incremental short-haul capacity of NGL and seven processing plants. from Washington, Mich., to Dawn, Ontario. Nighthawk Energy PLC ’s 5 MMCFD, 26 km Xenia gas pipeline is now in service, flowing into Kinder Morgan North American Footprint the Bourbon Co. pipeline, from which the product is sold into General Electric ’s Southern Star Interstate transport line. Nighthawk has also acquired a 50% interest in the 39 km Bourbon Co. pipeline from Admiral Bay Resources, for $500,000. Spain’s Iberdola will supply as much as 1 BCMY of LNG to the United States, per an accord with Chevron Corp. The agreement, giving Iberdola part of Chevron’s import capacity at the Sabine Pass terminal in Louisiana, began in October.

Experienced. Capable. Knowledgeable. Flexible. Ready To Work. Five States Energy Capital works with independent producers to acquire, develop, exploit, & service producing properties . 214.363.3008 www.fivestates.com

Source: Kinder Morgan’s NAPTP 2009 MLP Investor Conference FIVE STATES For more information: ENERGY CAPITAL , LLC [email protected] www.plsx.com Call PLS To Place Your Listing: (713) 650-1212 9 Wednesday, November 25 , 2009 MIDSTREAM NEWS Midstream/Marketing El Paso Corp. believes natural gas trumps coal CONTINUED from page 7 380 MMCFD Transco pipeline In recent years, due to rapid growth and middle class emergence, lucrative $25 MMCF expansion sought in Alabama LNG prices in Asia diverted supply from global markets. Taking that into consideration will Williams Co. ’s Inc. has filed with the be helpful in preparation for our future, as it is critical to this issue of domestic supply security, Federal Energy Regulatory Commission to Foshee said. And the potential impact on the U.S. economy of GHG regulation expand its Transco gas pipeline to serve — if the west regulates and growing economies in the East such as China do not Southeastern U.S. markets. — is a “big, huge, and thorny question,” Foshee said. The new service sought by Furthermore, clear and accessible eminent domain policy will be necessary in continuing Williams is from the Mobile Bay to build up domestic gas infrastructure; because a lack of transport assets is always a deal - South II Expansion project, to be available in the breaker for any gas project. spring of 2011. The proposed project is designed At a national debate level, the natural gas has undergone a bit of “benign neglect,” he said. to create an additional 380 MMCFD of south - Historically, natural gas marketing and government lobby perhaps have not been of a unified bound year-round capacity from Transco’s front, but that is changing as we move into the 21st century. Station 85 mainline near Butler, Ala., on the Natural gas alone is not the answer — but it is an important part of the solution, mixed Mobile Bay Lateral. It would interconnect with with other energy sources with consideration of capital costs, lead time, supply security, and Gulfstream Natural Gas System in Coden, Ala. policy with respect to solar, wind, nuclear, gas, oil and coal sources. “Williams is excited to provide this eco - nomically priced link between the abundant Final leg of REX pipeline completed onshore supplies now available at Station 85 Service on the last 179-mile leg of the Rockies Express -East began November 12 — the and growing markets in southern Alabama final portion of the pipeline from Lebanon Hub in Warren Co., Ohio, to Clarington in Monroe Co. and Florida,” said Williams’ gas pipeline REX is one of the largest gas pipelines ever constructed in the United States, 50% of which President Phil Wright. The expansion project is owned by Kinder Morgan Energy Partners LP , who constructed and will require a compression addition of 8,180 operate the 1,679-mile, 42-inch, $6.7 billion pipeline. Sempra Energy ’s HP at compression Station 85 and facility Sempra Pipelines and Storage , and ConocoPhillips each own a 25% REX stake. modifications at Station 83, at an estimated ConocoPhillips said its stake in the REX is a good example of the type of assets it is seeking project expense of $36 million. to divest, per its announcement last month that it would sell $10 billion worth in the next two years. “It’s been a while since we’ve really gone through our North American portfolio and Northwest Pipeline brings on rationalized that. We can look at that portfolio 360 MMCFD Colorado Hub and say, there’s probably 10% of that portfolio ConocoPhillips may sell 25% stake Williams Cos. Inc. ’s majority owned sub - that makes a whole lot more sense to be in sidiary Northwest Pipeline GP received someone else’s,” ConocoPhillips Senior Vice President of Planning and Strategy Jeff Sheets authorization from the Federal Energy said, at the Bank of America Merrill Lynch 2009 Energy Conference on November 17. Regulatory Commission to place into service its For example, ConocoPhillips also senses a very strong market for its 9% joint venture 26.4-mile, 24-inch gas transmission pipeline. stake in Syncrude Canada ’s oil sands operations in Canada, Sheets said, as well as other The Colorado Hub minority interests and older fields in North America. Connection links the Meeker/ REX is a 1.8 BCFD gas line stretching from northwestern Colorado to eastern Ohio. It is White River Hub, a regional production hub, now operational from beginning to end and available for full firm shipper nominations. REX with the Northwest Pipeline mainline system began serving Missouri in 2008, and reached western Ohio this summer. south of Rangely. The connection will pro - The new pipeline has had interesting effects on historical regional pricing trends, partic - vide about 360 MMCFD of firm transporta - ularly among the U.S. Northeast, Mid-Continent, and Canadian/Upper Midwest regions. tion service on the Northwest’s mainline to delivery points as far south as Ignacio, where it interconnects with El Paso Natural Gas and The Most Transwestern Pipeline Co. The Colorado Hub Connection project Experıenced cost is about $60 million. “Completion of the Colorado Hub makes it possible for us to con - Competent nect the Piceance Basin supplies with markets Reliable in the Western United States through & Northwest’s existing mainline system,” said OPERATING, LLC Phil Wright, Williams’ gas pipeline president. OIL AND GAS PLUGGING Williams owns a 35% interest in AND ABANDONING SERVICES Northwest Pipeline GP. P.O. Box 1983 Henderson, TX 75653 Advertise & List! (903) 657-4504 [email protected] Plugging And Abandoning Crews In EAST TEXAS, Now Is The Time To Eliminate Your Plugging Liabilities. Contact PLS 713.650.1212 Turn Key Bids Available! www.plsx.com

PLS Fax: (713) 658-1922 www.plsx.com MIDSTREAM NEWS Wednesday, November 25, 2009 10 LNG Hess LNG revives BP’s 1.2 BCFD LNG project in New Jersey Developers prepare for Same JV also buys Crown Landing project in Delaware Oregon LNG Terminal project All of BP PLC ’s ownership interest in Crown Landing LLC on the Delaware River has The Coos Bay, Ore. City Council is dis - been bought by Hess LNG , at an undisclosed price. cussing a non-binding agreement with the First announced in 2003 with a price tag of $600 million, the Crown Landing project Jordan Cove Energy Project, according to stalled after the U.S. Supreme Court ruling that state authorities have the right to local newspaper The World . Local officials block construction of a pier into the river. have been working with the developer on A week after the Crown Landing announcement, Hess LNG announced it emergency plans if the facility is built. also has plans to move forward with an LNG terminal project in southern New Jersey. Hess Developers of the Jordan Cove Energy LNG is evaluating a Logan Township location at which BP tried to build a terminal, and failed. Project/LNG Terminal on the North Spit have BP gave up on the Logan Township location in 2008, after five years of loggerheads with delayed plans to start construction until environmentalists. And, the same Supreme Court ruling regarding the Crown Landing pier also spring of 2011. The Oregon International served as a significant blow to BP’s designs in New Jersey project, though the plan for the 1.2 Port of Coos Bay officials have agreed to BCFD LNG terminal near Logan Township in Gloucester Co. was approved by the U.S. extend their three-way purchase option for Energy Regulatory Commission in 2006. 1,300 acres of Weyerhaeuser Co. property Hess LNG LLC is a joint venture equally owned by Hess Corp. and Poten & Partners . with Jordan Cove Energy Project. BP PLC has recently identified, for divestment in a midstream asset review, 62 U.S. mid - Also the commissioners tentatively stream properties. approved an 18-month extension to keep the option good through mid-2011, and port staff Waste Management, Linde convert trash to LNG presented a final deal Nov. 19. The contract Waste Management Inc. and Linde North America ’s joint venture at the Altamont has been previously extended by a year twice. Landfill near Livermore, Calif., began producing clean renewable vehicle fuel. The company says it will make a final invest - It is the world’s largest landfill gas to LNG plant. Built and operated by Linde, it purifies ment decision next fall, and would close on and liquefies landfill gas that Waste Management collects from the natural the land deal in late spring 2011 and immedi - decomposition of organic waste in the landfill. The plant is designed to produce ately begin construction. up to 13,000 gallons of LNG per day, which is enough to fuel 300 of Waste Management’s 485 LNG collection vehicles in 20 California communities. Briefs Landfill gas-derived LNG is a “super ultra-low” carbon fuel as designated by the Air Investigation continues into a November 5 gas Resources Board. Four California agencies contributed to the $15.5 million project, including pipeline explosion about 15 miles west of Amarillo. the state’s Integrated Waste Management Board, Air Resources Board, and Energy Two people were hospitalized, homes shook, and Commission, and the South Coast Air Quality Management District. flames shot hundreds of feet into the air. “Now that the technology has been proven, we look forward to seeing its adoption spread Freeport, Texas residents who evacuated so more vehicles can run on garbage,” said Linda Adams, secretary of California’s EPA. because of a Dow Chemical underground pipeline leak were cleared November 4 to return home. At least 60 homes were evacuated after Cameron’s Lake Charles LNG receipt terminal dedicated the leak was discovered October 25. Dow The newest receipt facility on the Gulf Coast, a $900 million terminal near Lake Charles, funded the evacuees’ hotel stays. Freeport is La., with a gas processing capacity of ~1.5 BCFD, was dedicated officially October 21. about 60 miles south of Houston. Construction took four years, and at its peak employed more than 1,000 people. According to November 12 offshore In addition to the new LNG facility, several major projects in Southwest Louisiana operator reports submitted to the Minerals have been recently announced, Gov. Bobby Jindal said at the ceremony, including Shaw Management Service , due to Tropical Storm Modular Solutions and the Northrop Grumman KC-10 contract — which he said reflect Ida personnel from one Gulf of Mexico production platform were evacuated, which is comprehensive reforms to facilitate Louisiana’s business climate during the dicey economy. the equivalent of 0.1% of the manned GOM The terminal’s first cargoes of imported platforms. No rigs were evacuated. The MMS gas arrived in June. Commercial operations The facility has a ~1.5 BCFD capacity estimated that about 2.2% of oil production and began July 30. linking to Gulf and East coasts, and about 2.7% of gas production in the gulf was About 65% of the combined 2.5 BCFD Southeast. shut-in for Ida. capacity at Sempra’s Energia Costa Azul Cabot Oil & Gas Corp. entered a Consent (near Ensenada) and Cameron LNG terminals is contracted. Cameron has a 20-year contract Order and Agreement with the Pennsylvania with Eni S.p.A. , and a flexible agreement with RasGas to purchase up to 50 LNG cargoes Department of Environmental Protection, through December 2010. Energia Costa Azul’s capacity is contracted under agreements with concerning drilling and hydrofracturing in Shell, Gazprom and Sempra LNG Marketing, for whose capacity agreement is supported by a Susquehanna Co. The DEP had identified the acreage in question because of methane in long-term supply agreement with BP Tangguh Partners’ liquefaction project in Indonesia. groundwater supplies; none of Cabot’s activities The gas processed at Cameron LNG will be used in the Gulf Coast, East Coast and Southeast. outside the area are affected by the agreement. Cabot will provide a temporary water supply or treatment service to 13 homes in the nine- square-mile area. Investigation into the contents For Energy Finance Insight of the formation continues. & Opportunities Search & Seek Subscribe to PLS’ Capital Markets by calling (713) 650-1212 Access www.plsx.com www.plsx.com Call PLS To Place Your Listing: (713) 650-1212 11 Wednesday, November 25 , 2009 MIDSTREAM NEWS

EnCap CONTINUED from page 1 Utility and Virginia Tech seek smarter smart grid EnCap Energy Infrastructure Fund is a Dominion Virginia Power is working with Virginia Tech University to make the “smart private equity fund managed by EnCap grid” smarter by developing and testing innovative technology to improve the electrical grid’s Energy Investments and Flatrock Energy efficiency and reliability. Advisors . Encap Investments LP and The technology known as “synchrophasors” provides dynamic, real-time MRI-quality Flatrock have partnered to form EEIF, and data in monitoring transmission grid conditions. The research project is funded by a $1.5 mil - secured capital commitments to provide lion U.S. Department of Energy grant also involves Quanta Technology. equity capital for North America midstream “What is particularly appealing about this technology is that it can be applied to our exist - infrastructure opportunities. ing transmission network, not just new projects,” Dominion Virginia CEO Paul Koonce said. TPH Partners is the private equity arm of “A smarter, more efficient and reliable electric grid means better service for customers, ben - Tudor, Pickering, Holt & Co. LLC. efits for the environment and lower costs in the long run.” Synchrophasors provide grid operators with the ability to better foresee, prevent, and manage Closing Briefs potential overloads on the grid, and also allows them to route power more efficiently. Exterran Partners LP has completed its previously announced acquisition of certain Range secures 150 MMCFD transport with Texas Eastern assets from Exterran Holdings for ~$143 million. Spectra Energy Corp. ’s Texas Eastern Transmission has executed a binding agreement Those assets included contracted equipment for a minimum of 150 MMCFD of firm transportation capacity with a Range Resources serving 18 commercial customers, and about 890 Corp. affiliate. Range Resources is the leading Marcellus Shale producer to bring new sup - compressor units used to provide compression plies of Appalachian gas to premium markets in the U.S. Northeast. services under those contracts representing Texas Eastern is also proposing an expansion to increase its system’s capacity by some 270,000 HP. Exterran Partners financed the up to 300 MMCFD beginning Q4 2012, referred to as the Texas Eastern Appalachia acquisition with about $57 million of new debt to Market (TEAM) Expansion Program. under a new $150 million asset-backed and “We look forward to working with Range Resources to deliver its natural gas production revolving credit facility, and the issuance of 4,739,927 common units and 96,601 general to markets seeking more diverse, secure supplies,” said Spectra Energy Transmission partners units to Exterran Holdings. Northeast group Vice President Billy Yardley. American Midstream Partners has closed Furthermore, Texas Eastern will soon announce a binding open season for the remaining on its purchase of 12 pipelines, and gathering 150 MMCFD capacity, for the targeted 2012 expanded service date. and processing assets from Enbridge Energy And depending on market demand, Texas Eastern may also pursue a second phase of the Partners LP ; the transaction was valued at TEAM Expansion (TEAM 2013). ~$151 million. The deal included two interstate pipelines and a substantial network of intrastate pipelines and gathering and processing systems primarily located in Louisana, Mississippi, Texas Eastern Transmission Asset Map Alabama and Tennessee serving industrial, commercial and local distributors. Magellan Midstream Partners anticipates completion of its Longhorn Pipeline east side terminal expansion by Q1 of 2010. Magellan also plans to build a 49-mile pipeline from the El Paso terminal into Juarez, Mexico in coming months. Magellan bought the asset from Flying J Inc. in July for $350 million.

• Location: Gulf Coast to Northeast United States • Length: 9,200 miles • Capacity: 6.7 billion cubic feet per day; 75.1 billion cubic feet of storage • Ownership Interest: 100 percent Spectra Energy Transmission • Operator: Spectra Energy Transmission

Source: Spectra Energy Corp. www.spectraenergy.com www.englehartenergy.com PLS Fax: (713) 658-1922 www.plsx.com MIDSTREAM NEWS Wednesday, November 25, 2009 12 U.S. ARRA energy policy Pricing upsets lawmaker U.S. Senator Charles Schumer is urging Week ending November 18 injects 20 BCF more into storage the Obama administration to block any stim - Gas spot prices increased throughout the Lower 48 since November 11. Henry Hub ulus money from financing a wind farm in prices increased about 4% to $3.74 MMBtu. Henry Hub futures for December delivery settled West Texas that would rely entirely on tur - November 18 at $4.254/MMBtu. bines manufactured in China. As of November 13, gas storage was a record-setting 3,833 BCF — about 12% “I’m all for investing in clean energy, but above the five-year average. Since November 11, the WTI spot price increased by we should be investing in the United States, 39 cents, to $79.55/bbl. not China. The goal of the stimulus was to Falling domestic demand for fuel has led to several facilities shutting in recent months, as spur job creation here, not overseas. This Valero Energy Corp. closed its Delaware City, Del. refinery November 20; Western Refining project should not receive a dime of stimulus Inc. closed its Bloomfield, N.M. refinery earlier in the month. funds unless it relies on U.S.-manufactured Increasing gasoline prices have led to changes in American driving habits, and the reces - products,” Schumer said. sion has further aggravated the impact on refiners. As it stands proposed, the $1.5 billion project would create an estimated 2,000 to 3,000 jobs in China. Project organizers of the NYMEX Natural Gas Futures Near- Month Contract Settlement project, a joint venture consisting of China’s Price, WTX Intermediate Crude Oil Spot Price & Henry Hub Natural Gas Spot Price Shenyang Power Group , Cielo Wind Power , and the U.S. Renewable Energy Group , have said they will seek to defray up to 30% of the cost ($450 million) with funds authorized by the American Recovery and Reinvestment Act. $12 The JV recently announced their plan to u t B

build a 648 MW wind farm in West Texas cov - n ering 36,000 acres, to generate enough electric - o $8 NYMEX Natural Gas Settlement Price i l

l WTI Spot Price ity to power 135,000 to 180,000 homes annu - i

M Henry Hub Spot Price ally. Groundbreaking is anticipated in March. r e

Since September 1, the U.S. government p

s $4 has reportedly spent more than a billion dol - r a l lars in clean-energy grants, and 84% of that l o funding went to foreign wind companies. D $0

9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 / / / / / / / / / / / / / / / / 0 7 4 1 8 5 2 9 3 0 7 3 0 6 5 2 / / / / 1 1 2 1 2 2 1 2 2 3 / 1 / / / 0 0 / / / / / / 9 / 8 1 / 9 9 9 1 1 0 0 0 8 8 8 7 1 1 1 1 1 Much More 1 Note: The West Texas Intermediate (WIT) crude oil price, in dollars per barrel, is converted to $/MMBtu Than A using a conversion factor of 5.80 MMbtu per barrel. The dates marked by vertical lines are the NYMEX Marketing near-month contract settlement dates. Company Source: Natural gas prices, NGI’s Daily Gas Price Index (http://intelligencepress.com), WTI price, Reuters News Service (http://www.reuters.com)

Comprehensive Services Regional Spot Prices for Natural Gas for Independent Oil and Gas Spot Prices Thu Fri Mon Tue Wed Producers ($ per MMBtu) 12-Nov 13-Nov 16-Nov 17-Nov 18-Nov Henry Hub 3.24 2.51 2.65 3.47 3.74 New York 3.55 2.65 3.13 4.05 4.22 Chicago 3.32 2.44 2.81 3.82 4.01 Cal. Comp. Avg.* 3.70 2.89 3.26 4.22 4.28 Future ($ per MMBtu)

Expect more for December Delivery 4.370 4.392 4.614 4.530 4.254 your energy. January Delivery 4.761 4.798 4.991 4.907 4.659 713.209.1112 cimaenergy.com *Avg, of NGI’s reported average for: Malin, PG&E citygate and Southern California Border. Call PLS To Place Your Listing: (713) 650-1212 Source: NGI’s Daily Gas Price Index (http://www.intelligencepress.com) www.plsx.com 13 Wednesday, November 25 , 2009 MIDSTREAM NEWS International Pemex to invest $12.1 billion in pipelines Spectra’s South Peace 220 To compensate for reduced production, Pemex has announced it will invest $12.1 billion MMCFD pipe in service in new pipeline and maintenance of existing pipeline projects in the next 10 years. And in the Spectra Energy Corp. ’s 95 km South next five years, Mexico’s state-run company aims to spend $5.5 billion on storage facilities, Peace Pipeline, extending the company’s gath - pumps and new pipelines. ering system in the Northeast B.C. Mexico’s crude output has decreased by more than 25% in the last five years. Montney/Doig/Cadomin plays is Its oil production is off by a quarter since its 2004 peak because of declining output now in service. from the Cantarell field and a dearth of new discoveries. The pipeline has a capacity of more than The state-run company will probably seek about $3 billion in 2010 project 220 MMCFD and provides producers in the funding from external markets, as it seeks to maintain 2.5 MMBPD output, Pemex Chief emerging region with access to the com - Executive Juan Jose Suarez said at a November 19 conference in New York. pany’s Fort St. John-area infrastructure to Pemex relies heavily on debt due to a lack of equity because of its large debt pile, include the McMahon processing plant. unfunded pension liabilities and accumulated losses. Also in the longer term, Mexico plans to hike its oil production via a new incentive-based 3 Pakistan refineries totaling contracting mechanism designed to allow Pemex to apply international expertise and capital 465,000 BPD almost done markets. Those draft contracts in the Mexican energy legislation are expected to finalize some - time in the first half of 2010. Comprising a capacity of 465,000 BPD, the Khalifa Coastal refinery, the Bosicor Oil ExxonMobil’s $4.5 billion Chinese refinery fully operational Pakistan Ltd. facility, and the Trans-Asia Refinery Ltd. facility will soon be operational. ExxonMobil and partners Sinopec , Fujian Province and Saudi Aramco ’s JV involving Existing refineries include the Pak- China’s first integrated refining and petrochemical facility with foreign participation — the Arab refinery; the National refinery; the Fujian Integrated Refining and Ethylene Joint Venture Project — is an investment of more Pakistan Refinery Ltd. facility; the Attock than $4.5 billion. The facility is now at full operation, with the $4.5 billion invested approxi - refinery; the Bosicor Pakistan facility; mately tripling the capacity of the existing refinery to 240,000 BPD. Also, Dhodak Refinery Ltd. facility; and Enar the projected added a new 800,000 TPY ethylene steam cracker, an Petrotech Services Ltd. facility. 800,000 TPY polyethylene unit, a 400,000 TPY polypropylene unit and a 700,000 TPY paraxy - lene unit. The complex also features 250 MW cogeneration facility. Fujian Petrochemica Co. Ltd. owns 50%, ExxonMobil China Petroleum and Chevron awards Acergy $500 Petrochemical Co. Ltd. owns 25%, and KSA’s Saudi Aramco Sino Co. Ltd. owns 25%. MM Nigerian pipeline contract The project is fully integrated with the Fujian Fuels Marketing JV, owned by Sinopec at Acergy S.A., was awarded by Chevron 55%, ExxonMobil China Petroleum and Petrochemical Co. Ltd. at 22.5%, and Saudi Aramco Nigeria Ltd. a contract for gas development in Sino Co. Ltd. at 22.5%. The JV manages and operates about 750 service stations and a net - Escravos offshore, for ~$500 million. In depths work of terminals in the province. of up to 40 meters, the contract includes procurement of more than Somali pirates still targeting tankers 130 km of pipelines, fabrication and instatlla - A November 9 attack on a Hong Kong-flagged tanker was the deepest ever in the Indian tion of 15 risers and three subsea tie-ins, and Ocean according to the European Union Navy on November 9 — the BW Lion was attacked installation of more than 40 crossings. by two skiffs about 400 NM off Seychelles, 1,000 NM east of Mogadishu. The BW Lion Installation is scheduled for Q4 2010. evaded the attack. On November 3, about 360 NM off eastern Kenya, a Dutch oil tanker and a U.S. Sinopec buys Papua New cargo ship were attacked in the Indian Ocean, and fended off their aggressors. Guinea LNG from Exxon Last year, Somali pirates hijacked the Liberian-flagged KSA -owned, Vela ExxonMobil Corp. has reached a deal International -operated Sirius Star crude carrier, about 450 NM off Kenya. to sell 2 MMTY from its Papua New Guinea Spain paid a $3.3 million ransom on November 16 to Somali pirates, for the release of a project to China’s Sinopec . The Exxon-led Spanish trawler and its 36 crewmembers. project is now in exclusive talks with four On November 17, the U.S.-flagged Maersk Alabama — which was taken by pirates off major Asian LNG companies toward binding the coast of Somalia in April — avoided a second capture after a skirmish with suspected contracts related to nearly all the PNG LNG pirates in a skiff offshore Somalia. The ship fended off attackers with evasive maneuvers and project’s capacity of 6.6 MMTPY. by returning small arms fire. The venture also includes Australia’s Oil The EU Navy said the international transit corridor near the coast is safer because of Search Ltd., Santos Ltd., Japan’s Nippon Oil international patrols, though it is compelling pirates to make attacks farther out to sea. Co., and PNG land owners; sales agreements are sought to be finalized before a December 8 final investment decision. In addition to Sinopec, other targeted www.phdwin.com NOW EVEN MORE POWERFUL WITH buyers for the project are Tokyo Electric, Osaka Gas Ltd., and Taiwan’s CPC Corp. 2.8 Sinopec has said the PNG LNG will go TRC Consultants, LC offers the complete Coming in September to its receiving terminal planned in the solution for evaluating, managing, and RSVP: [email protected] Shandong province. China’s gas consump - reporting reserves and performance data or call 1-888-248-8062, ext. 4 tion will triple in the next decade, rising to about 18 BCFD by 2020. www.plsx.com PLS Fax: (713) 658-1922 MIDSTREAM NEWS Wednesday, November 25, 2009 14 Briefs People OGE Energy Corp. ’s midstream pipeline subsidiary Enogex LLC , sold $250 million of Copano Energy’s John Eckel Jr. passes at 58 6.25% 10-year senior notes. The pipeline On November 13, Copano Energy LLC ’s CEO John R. Eckel Jr. passed away at age 58. company intends to apply the net proceeds for Eckel had been on a medical leave since November 4, and recently suffered from liver failure. purposes to include debt service toward the Eckel founded Copano Energy in 1992 and served as president and CEO until April 2003, $289.2 million outstanding aggregate principal when he became chairman and CEO. amount of its 8.125% senior notes, when they Prior to Copano, Eckel worked for various energy drilling, service and E&P companies mature January 15, 2010. OGE is the parent including E&P company Live Oak Reserves Inc. , which he founded in 1986. Before joining company of Oklahoma Gas and Electric Co. the energy sector, Eckel was named assistant vice president, energy finance, for Lehman TC Pipelines LP priced the public offering of 5,000,000 common units at $38 per share. Brothers in 1978 — a company he had joined the previous year as an associate in corporate The partnership expects to receive net proceeds finance. Before Lehman Brothers, he was an investment analyst and then assistant director of of about $185.4 million – or $213.3 million if the investments (energy and minerals) for securities investment department of the Mutual Life underwriters exercise their option to purchase Insurance Co. of New York. Eckel also was a board member of the Texas Pipeline Association. an additional 750,000 common units from In lieu of flowers, his family requests direct donations in Eckel’s memory be made to the the offering. Whitney Museum of American Art, attn: Michele Snyder, 945 Madison Ave., New York, N.Y. Raising ~$67,982,000, Holly Energy Partners 10021; or the Museum of Fine Arts, Houston (American Painting and Sculpture), attn: Tammy LP offered 1,900,000 common shares priced at Largent, P.O. Box 6826, Houston, Texas 77265. $35.78, in order to fund the cash portion of the purchase price for pending acquisition of tankage, loading racks and pipeline assets at a refining Icon NGS formed by consortium that includes Quantum Energy facility in Tulsa, Okla. Holly Corp. recently entered Quantum NGS Holding LLC , Larry Bickle, William Lang, and Mark Fullerton has an agreement with a Sinclair Oil Corp. subsidiary formed Icon NGS LLC , based in Houston. Icon will develop and/or acquire high deliverabil - to buy Sinclair’s refinery in Tulsa at a price of $128 ity multi-cycle domestic storage capacity. million. Holly already has an existing refinery in Lang, Fullerton and Bickle have collectively developed, operated, financed or acquired Tulsa, about two miles from the Sinclair facility. more than 200 BCF of working capacity, including successful development and operation of Bob Purgason will become the new COO of projects including Bobcat, Egan, Kirby Hills, Lodi, Moss Bluff, NorTex and Tioga Gas Storage. Chesapeake Midstream Partners , and will be “Given the strong industry fundamentals we see today coupled with the financial disrup - stepping down from Crosstex effective November 30. tion the natural gas storage development market has recently experienced, we are very excited Donald Sinclair has been named president of about the prospects for a new well-capitalized growth-oriented storage development com - Western Gas Partners’ GP; Jesse Ozbolt has pany,” CEO Lang said. become the CEO of ECCO Energy ; Susan Carter Icon represents Quantum NGS’ second subsidiary storage development company follow - has been appointed senior VP and CFO of KBR ing its formation of Merchant Energy Partners in 2008. Quantum NGS Holdings is a partner - Inc. , Michael Cockrell has been named senior ship between Quantum Energy Partners, and Larry Bickle. vice president, Bryan Bulawa has been promoted to senior VP of finance; Patricia Totten and Bart Moore have been named VPs at Enterprise Valerus Compression gets investment CONTINUED from page 1 Products Partners LP . Kip Ferguson III has been JP Morgan and Tudor Pickering & Holt Co. Securities Inc. were the financial advisors appointed executive VP of exploration and Brian Burgher has been named VP of land, and Donald to TPG. Vinson & Elkins LLP served as legal counsel to TPG. Valerus was represented by Kirkendall has been appointed senior VP of Barclays Capital and King & Spalding LLP . product marketing and administration. TPG took TXU Corp. , which is now Energy Future Holdings Corp. , private in 2007 for Carl Luna has joined Copano Energy LLC as $44 billion. TPG was also part of the consortium that bought Texas Genco in 2004 for $3.7 bil - senior VP and CFO; Glen Mayer has been named lion. That consortium later sold Genco to NRG Energy Inc. for $5.8 billion, in February 2006. CFO of Standard Renewable Energy ; El Paso Corp. ’s Mark Leland has been named executive VP and president of the midstream group; John R. Sult has been named senior VP and CFO. Cal Dive International has appointed Bruce Koch as executive VP and CFO; Foster Wheeler Design has elected Clayton Daley to its board of directors; Andrew Cochran has been appointed as the chief Develop executive of Dominion Petroleum replacing interim chief Justin Dibb; Greg Martin has been & appointed to the board of Santos ; RedHawk You Dr eliver Energy has named Thomas Concannon as senior Company PLS’ Media Group brings together dynamic media VP; CGX Energy has appointed John Clark to VP of capabilities, target marketing services and a depth of business development. Message oil and gas experience to deliver corporate messages Advanced Marketing and (or needs) to clients, investors, the financial marketplace and/or the industry as a whole. Media Solutions Beau Kelley Director of Media Group (713) 600-0111 or (403) 294-1906 [email protected] www.plsx.com (713) 752-0062 | www.ngpcrc.com www.plsx.com Call PLS To Place Your Listing: (713) 650-1212 laymakers he Patch with Industry P Celebrate Christmas in t akers! laym ericas P r 2, 2009 @ Hilton Am Decembe n, Houston, TX 77010 1600 Lamar St., Downtow Hot Topics Include: Eagle Ford, Haynesville & Bakken • Market Trends • Drilling & Service • Capital Markets

Participating Speakers: Past Participants Include: • Bobby Tudor – Chairman & CEO, Tudor Pickering Holt & Co. • Alamo Resources • GeoSpectrum • NuTech Energy • Alliance Oil & Gas • Ginger Oil • Nytex Petroleum • Art Smith – Founder & President, Triple Double Advisors • Apache • GLS • Oceanis Energy • Baker Hughes • Guggenheim Partners • Oil2 Holdings Bobby Tudor • Glenn Hart – Founder & President, Laredo Exploration • Bloomberg News • Halliburton • Parks & Luttrell • Booz & Co • Hart Energy • Penergy • Danny Weingeist – Co-Managing Partner, • Caddo Minerals • Hercules Offshore • PetroCap Kayne Anderson Energy Funds • Callon Petroleum • Hess Corporation • Petroleum Develp. • CGGVeritas • Hilcorp Energy • PetroQuest Energy • John Weinzierl – Managing Director, Natural Gas Partners • Cobalt • Hurd Enterprises • Phoenix Expl. • Compass Resources • INEXS • Platts Oilgram News Danny Weingeist • Nikolai Lyngo – International E&P, Business, Development • Condina Interests • JC Energy • Precision Drilling North America, Statoil • Covenant Energy • King Royalty • Primexx Operating • Craton Energy • Land Rig • Quantum Energy • Cory L. Loegering – Sr. Vice President, Deepwater, • Crusader Energy • Landmark Resources • Riley Exploration Mariner Energy • Dale Resources • LandTemp • Rippy Energy • Diversity Petroleum • Lease Auction House • Rockwell Energy • Frank A. Lodzinski – President, GeoResources • Doughtie Exploration • Legado Resources • Rodman & Renshaw • DrillingInfo • Linn Energy • Rosetta Resources Nikolai Lyngo • Ramona Hovey – Sr. VP Products & Services, DrillingInfo • DTE Energy Trading • Llano Group • RoundRock Capital • El Paso E&P • Lupine Energy • Rowan Drilling Co • Wayne Penello – Founder, Risked Revenue Associates • Energy Capital • Macquarie Bank • Sanchez Oil & Gas Solutions • Manhattan Petro. • SEC Energy • Randy Clark – President & CEO, Energistics • Energy Partners • Maritech Resources • Sojitz • Energy Spectrum • Maxwell Resources • St Mary Land & Expl. • Mike Weiss – SVP Products & Technology, WellPoint • Energy XXI • McCord Resources • Stallion Oilfield • EnRisk Services • Meagher Oil & Gas • TD Ameritrade John Weinzierl • Dan Belger – Vice President of Sales, Accruit • eSeis • Mestena Operating • Trident Steel • Evolution Petroleum • Milagro Exploration • Tristream Energy • Allen Parks – Co-Founder, Parks Paton Hoepfl & Brown • Fairway Minerals • Moore Marketing • Venoco • Fender Expl & Prod • Moyes & Co • Wandoo Energy • Dr. Frank D. Mango – Founder & CEO, Petroleum Habitats • Five States Energy • Murchison Oil & Gas • WestCo Energy • Richard Bernardy – Managing Partner, PLS Capital • New Century Expl. Services • Forest Oil • NGP • Yeager Interests Art Smith • Ronyld W. Wise – Managing Director & Founder, PLS • Frankel Resources • Noble Petroleum • Yuma Expl & Prod. • Fronterra Geosciences • Noble Royalties and many more... Participating Companies:

Kayne Anderson LIME ROCK Capital Advisors, L.P. PARTNERS

Some Exhibitors: CONVINGTON EXPLORATION COMPANY , LLC

GRAND ENERGY, INC. Organized & Hosted By:

Special Event Partnership Media Sponsors: With: Partners:

Sign Up Now! 713.650.1212 or email [email protected]

www.plsx.com/playmakers All proceeds from the evening reception will go to the Toys for Tots Foundation. www.toysfortots.org The Playmakers Symposium and E&P Summit December 2, 2009 @ Hilton Americas, Houston, TX You Pay Add’l Passes Standard Registration Form $395/ $295 Attendee(s) (Five (5) Registrants Per Form) Attendee Name 1 (Lead Contact) Title

Attendee Name 2 Email SIgn Up Now Attendee Name 3 Email Sign Up Today! Attendee Name 4 Email • Industry Perspective & Trends • Resource Plays Game-Plan • E&P Strategic Update Attendee Name 5 Email • Capital Preservation • Services Strategies & Trends Billing Address Continuing Education Credits! (Pending) City State/Province Country Postal Code Limited Exhibit Space! Telephone Fax

Email: [email protected] Email (Lead Contact) Company Mail To: PLS, Inc. P.O. Box 4987 Houston, TX 77210 All proceeds from the evening reception Call: (713) 650-1212 will go to the Toys for Tots Foundation. www.toysfortots.org

For more information visit: You Pay Can’t attend all-day event? www.plsx.com/playmakers Conference $ Try the Evening Reception! & Reception Pass 395 Reception Pass ONLY $ Call Now! (4:15 pm to 8:00 pm) 100 Booths Available! + Additional Passes: $295 only $ 595 x Total № of Passes: x Total № of Passes: Total: Total:

Payment Information (Completing the following below, authorizes PLS to charge your card, if applicable.)  AMEX VISA  MasterCard  Check (Payable to PLS Inc. Insert FormName on memo line.) Name as it appears on card Card Number Exp. Date

Signature of Cardholder 7 Date 00 / 00 / Disclaimer: Cancellation info and/or refund policy accessible at www.plsx.com/playmakers For information on services offered by For details on any PLS event, Call Samara Silverman at (713) 650-1212 or email [email protected] PLS, Inc., please call (713) 650-1212 or Badges are transferrable in the event of cancellation. There are no refunds, but PLS provides subsequent or future show passes visit www.plsx.com in exchange for current year cancellations. Valid as of: 11/20/09 Fill out & fax back to (713) 658-1922 or (713) 600-0197