Vaquero Midstream plans to expand two major natural gas infrastructure projects in the Southern Delaware Basin, the company said April 29.
A new 70-mile, 24-inch high-pressure pipeline loop will enhance connectivity between northern Reeves and Loving Counties and Vaquero’s processing hub near the Waha Hub in Pecos County, Texas.
The new pipeline will double the company’s gathering capacity from 400 MMcf/d to about 800 MMcf/d.
In tandem with the pipeline extension, Vaquero is constructing a new 200 MMcf/d cryogenic processing plant, also close to the Waha Hub. The plant will expand the company’s processing capacity in the Delaware Basin to 600 MMcf/d. The new build will use existing infrastructure, such as power supply and downstream connections for residue gas and NGLs.
The planned pipeline will also broaden Vaquero’s operational footprint across Ward, Winkler and Loving counties, Texas. The pipeline loop is expected to provide a benefit in gathering growing gas volumes from the northern areas of Vaquero’s system, where gas production is expected to increase over the next few years.
The pipeline is expected to be in service by the end of 2025.
Vaquero is one of five private midstream companies in the Permian that have continued development through a wave of consolidation.
“Vaquero is dedicated to maintaining its position as one of the most reliable midstream operators in the Delaware Basin,” Harrison Holmes, Vaquero Midstream CEO, said in a press release. “This expansion of our gathering system will be key in providing direct access to Vaquero’s system from northern Reeves and Loving Counties to our processing complex near Waha. Our continued goal is to offer producers a unified gathering platform, supported by downstream market connectivity and reliable power infrastructure.”
The new processing facility is scheduled to start operations by March 2026. Its integration into the existing complex near Waha will allow Vaquero to scale up capacity with minimal disruption, the company said.
Both the pipeline and the cryogenic plant are being financed in part through a recently secured $400 million credit facility. BOK Financial is the organizer of the financial package.