Atlas Pipeline Partners, LP (APL) is also enjoying an unprecedented prosperity. Distributable cash flow at APL for the first quarter 2012 increased 32% year over year, and the actual distribution of $0.56 per unit for the quarter is 40% higher than in the previous year.
All processing plants are operating at or beyond certified capacity – I’ll explain that shortly – and the current $600 million system-wide growth expansion project is on schedule and should shortly begin to contribute substantially through Atlas Pipeline revenues.
Now, the west Texas systems average natural gas processed volume was 230.5 million cubic feet per day for the first quarter of 2012, compared with only 172.8 million cubic feet per day for the prior year comparable period. West Texas is scheduled nearly to double its capacity, however, when the new 200 million cubic feet a day driver plant enters service, and that’s APL’s response to the incredible boom affecting our dedicated acreage in the Sprayberry and Wolfberry plays of the Permian Basin.
The first phase, 100 million cubic feet per day, will enter service in the first quarter of 2013, and the second phase, another 100 million additional cubic feet, is now scheduled to be operational in the first quarter of 2014, and those who follow our comments closely will know that that’s a full year ahead of the originally announced in-service date. When things are booming, we try to meet the need.
APL’s west Oklahoma system, likewise, is operating beyond capacity with substantial volumes bypassing the processing facilities or being offloaded to third parties for processing. The problem – I should say our blessing – is the continuing rapid expansion of production in the liquids-rich Mississippian limestone formation in Oklahoma and Kansas, but relief is on its way together with increased revenues.
By mid-2012, a new 200 million cubic feet per day cryogenic plant will be operational, together with a substantial expansion of our west Oklahoma and Kansas gathering systems, which in turn will provide further opportunity for even greater future growth.
Finally, we’re on the verge of expanding our Velma, Oklahoma plant with a new 60 million cubic feet per day facility intended to provide relief to a plant that for some time has already been operating as much as 10 million cubic feet per day beyond its nameplate capacity of 100 million cubic feet per day and has still been forced to offload some 22 million additional cubic feet per day.
Yes prices are down but APL gets paid for volume transported which goes up as prices go down. Many coal power plants are now being converted to natgas because it is now cheaper and they are clamping down on coal pollution. Gas consumption will increase rapidly in future.