Butler County cranks up gas processing plant construction

Construction will ramp up next week on a natural gas processing plant in Butler County, part of what could be a buildup of several plants there, industry and state officials said on Tuesday.

The plants are designed to give special capacity to pipe away shale gas that comes up mixed with liquid fuels, which is common in Butler County and has led to increased attention there. The biggest immediate beneficiary is State College-based Rex Energy Corp., which said it has 20 wells, previously drilled, that can now be finished and connected to the new plant in Jackson.

"The trend has got to be toward liquids because ... there's just a lot more value," said Michael Brinkmeyer, general manager at Keystone Midstream Services LLC, which is partly owned by Rex. "We're kind of a slave to how (drillers) develop. So if they develop right there in that Butler County area, we'll be building new plants there or expanding current plants in that area."

The plant will cost tens of millions of dollars, he said, declining to be more specific because Keystone is privately owned. It is a cryogenic plant, which means it cools the gas in order to get propane, butane, ethane and other hydrocarbons to liquify and separate from natural gas, methane. Brinkmeyer compared it to condensation gathering on an icy glass.

Keystone, based in Bloomfield, Colo., has a plant in Forward Township and permits pending for four more plants in southwest Butler County, according to the state Department of Environmental Protection. It has been in talks about processing gas from Royal Dutch Shell plc and Exxon Mobil Corp. -- two companies that recently bought into the area -- but no deals yet, said Brinkmeyer in Marshall.

Another company, Mountain Gathering LLC, is seeking a permit for a plant farther east in Penn, Butler County, said DEP spokesman John Poister. The Williams Companies Inc. is also considering a pipeline, called Confluence, going through Butler County with two processing plants, including one in Cranberry, according to company documents.

A problem is that the state is permitting these plants without considering their total impact, said Joe Osborne, the legal director at the Group Against Smog and Pollution, who studied Keystone's permit application for the Jackson plant, called Bluestone. Processing plants and compressor stations emit compounds that create ozone, and thousands of them are popping up statewide.

"Oh, man, this is a big issue," Osborne said. "Portions of Pennsylvania already fail to meet (ozone) standards. And with a big build-up in an industry that produces exactly the type of pollution that causes us to fail to meet this standard, it's bad news."

Osborne's questions about the plant helped to hold up the permit, the DEP's Poister said. It was delayed for several months and, while Keystone did start foundation work there, it had to put some equipment in storage while it waited, Brinkmeyer said.

Construction will ramp up next week after the holiday break and should be completed in time for the plant to open in late spring, he added.

The sister plant, Sarsen, in Forward, has nine employees, and Bluestone should have the same or slightly more because of its bigger capacity, Brinkmeyer said. Bluestone construction will employ about 120, with another 30 people working on pipeline projects to connect it to wells, he added.