Tumbleweed Midstream has acquired DCP Midstream’s Ladder Creek Helium Plant and Gathering System, located west of Cheyenne Wells in Colorado, US, for an undisclosed amount.
The Ladder Creek system is located close to Colorado-Kansas border, and is backed by long-term acreage commitments across Cheyenne, Kit Carson and Kiowa counties in Colorado and Hamilton, Greeley, Wichita, Kearney, Wallace and Finney counties in Kansas.
Tumbleweed CEO Durell Johnson said: “The acquisition of the Ladder Creek Helium Plant and Gathering System represents a significant opportunity for Tumbleweed Midstream. The U.S. is the world’s largest helium producer. At the same time, the world supply of helium is suffering from a multiyear shortfall.
“This has boosted prices for natural gas with high helium content and has begun to raise red flags in industries that depend on helium. The growth of Ladder Creek’s helium operations starts with delivering our current customers superior economics with the highest level of service. The helium is there, it’s highly valuable and by extracting it Tumbleweed can return premium netbacks to the producers in the region.”
Details of Ladder Creek cryogenic processing plant and gathering system
Tumbleweed said that the natural gas produced in the region is comprised of high helium content, with approximately three percent concentration. Helium has applications cryogenics, MRI machines, welding, deep sea diving, fibre optic cables, semiconductors, and helium-filled balloons.
In addition, the newly acquired helium plant and gathering system serves natural gas producers operating in eastern Colorado and western Kansas, including Morrow, Mississippian, Spergen, Chester and Marmaton formations.
In 1997, Union Pacific Resources had established the Ladder Creek cryogenic processing plant to separate helium from the natural gas and liquefy it for marketing. The plant was later acquired by DCP Midstream in 1999.
Currently, the plant is capable of processing 40 million cubic feet (MMcf/d) of natural gas per day, and can be expanded up to 50 MMcf/d.
The gathering and distribution infrastructure associated with the Ladder Creek system includes approximately 730 miles (1,174.8km) of pipeline.
Founded in 2019, Tumbleweed Midstream is focused on acquisition, operation and growth of the Ladder Creek Helium Plant and Gathering System.
