Zephyr Energy Triples Initial Gas Processing Capacity at Paradox Basin Project
en.Wedoany.com Reported - On August 24, Zephyr Energy announced that its Board of Directors has approved additional engineering and well operation funding to increase the initial gas processing capacity at the Paradox Basin project in Utah to 15 million standard cubic feet per day (MMscf/d), a threefold increase from the previous base case of 5 MMscf/d.
The Paradox project is Zephyr Energy's core operating asset, located in the Paradox Basin, Utah, covering approximately 70,000 acres. The project includes the White Sands Unit, which has been independently assessed with 2P reserves of 35.3 million barrels of oil equivalent and total recoverable resources of 74.2 million barrels of oil equivalent.
This capacity increase is based on the Board's confidence that the Enbridge-led regulatory approval will proceed smoothly. The 16-inch pipeline operated by Enbridge requires regulatory approval to increase operating pressure before it can transport Zephyr's natural gas to the Northwest Pipeline system operated by Williams. Enbridge has completed a months-long in-line inspection (ILI) of the pipeline and is currently conducting excavation and visual inspections on four short pipe sections, with no safety issues identified to date. Engineering design is underway for the construction of a modular gas processing system.
Initial gas will be supplied by two existing wells, State 36-2R and Federal 28-11, with additional new and existing wells to be brought online as cash flow, planning, and regulatory permits allow. Zephyr has identified new well locations for subsequent drilling, with specific locations and permitting details to be announced once well site planning is completed. The tie-in plan for the State 16-2 well will be announced separately after first gas.
Zephyr CEO Colin Harrington stated that the company aims to advance operational preparations in parallel with the Enbridge regulatory approval process to achieve first gas and commercial production as soon as possible after approval is granted. Additionally, the company continues to advance potential farm-out transactions and the $15 million commodity purchase agreement announced on July 27.
