Saxon Oil Announces Gas Gathering Joint Venture In Kansas

Saxon Oil Announces Gas Gathering Joint Venture In Kansas

Tuesday, August 26th 2008

Saxon Oil Company Ltd. announced today that its wholly owned subsidiary, Central Kansas Gas Gathering (“CKGG”), signed a joint venture agreement with Mid Kansas Gas Gathering LLP (“MKG”) of Wichita, Kansas. The 50-50 joint venture, called Mid Kansas Gas Gathering JV (“MKGG”), will be headquartered in Wichita, Kansas, with American Energies Pipeline, LLC (AEP) acting as operator. The joint venture combines more than 400 miles of natural gas gathering systems and includes the purchase of a 10 million cubic feet per day natural gas processing plant to be located at a central processing and sales point along the combined systems. MKGG’s primary purpose is to provide low btu natural gas producers in central Kansas with gathering, processing, treating, and other natural gas services.

The MKGG joint venture consists of CKGG’s 230 miles of pipe and another 200 miles of pipe owned by MKG. MKGG’s gathering systems are located in McPherson, Rice, Barton Harvey, Kingman, McPherson, Pawnee, and Reno counties of Kansas. The largest system is approximately 125 miles of pipe that stretch east and west between Conway and Great Bend, Kan., across McPherson, Rice and Barton counties, with secondary, perpendicular lines connecting to it. Another large system, consisting of approximately 48 miles of pipe and compression facilities, is located west of Great Bend, Kansas, in Pawnee County. In addition to the gathering systems, MKGG has acquired a gas processing plant with throughput capacity of up to 10 million cubic feet per day of natural gas. This plant is being upgraded to handle nitrogen and helium extraction and will be mobilized to Kansas later this year. Plant operations expected to commence in the first half of 2009.

“The joint venture with AEP’s experienced technical team is an exciting opportunity for CKGG and Saxon,” stated Steve Moore, president of CKGG. “Besides the joint venture of our gas gathering assets, American Energies and Saxon will jointly explore for and produce natural gas along the existing gathering systems.”

For more information on Mid Kansas Gas Gathering, please visit their web site

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