El Paso Reenters Natural Gas Gathering & Processing Business

El Paso Corporation is an energy company, which operates in the natural gas transmission and exploration and production sectors of the energy industry. The Company owns or has interests in North America’s interstate pipeline system, which has approximately 42,000 miles of pipe that connect North America’s producing basins to its consuming markets. It also provides approximately 230 billion cubic feet (Bcf) of storage capacity and has a liquefied natural gas (LNG) receiving terminal and related facilities in Elba Island, Georgia.

The El Paso Corp. has decided to reenter the natural gas gathering and processing business to link its interstate pipelines with the new supplies of gas from Louisiana’s Haynesville Shale and other areas of growing natural gas production. El Paso said that it will form a new “midstream” segment that will acquire and possibly build facilities to treat gas after it is extracted from the wells and transport it to interstate pipelines. El Paso sold its remaining interests in gathering and processing assets in 2005 to affiliates of privately held EPCO Inc., a Houston company.

Commentary – Shale plays have attracted interest from pipeline companies and private investors. Analysts have said that El Paso could acquire gathering and processing assets connected to the Haynesville Shale and to the Eagle Ford Shale in Texas.