Cal Dive buys 20 percent of Independence Hub
Cal Dive International, Inc. (Nasdaq: CDIS) and Enterprise Products Partners, L.P. (NYSE: EPD) have completed a transaction in which Cal Dive has acquired a 20 percent interest in Independence Hub, LLC, an affiliate of Enterprise Products Partners L.P.
Independence Hub, LLC will own the "Independence Hub" platform to be located in Mississippi Canyon block 920 in a water depth of 8,000 feet.
Independence Hub, LLC has previously executed agreements with the Atwater Valley Producers Group of five exploration and production companies for the dedication and processing of natural gas and condensate production from fields in the Atwater Valley, DeSoto Canyon and Lloyd Ridge areas of the deepwater Gulf of Mexico on the Independence Hub platform. As part of that transaction, the producers have also dedicated future production from a number of undeveloped blocks in the area for processing.
The 105 foot deep draft, semi-submersible platform will serve as a regional hub for natural gas production from multiple ultra-deepwater fields in the previously untapped eastern Gulf of Mexico. The platform, which is estimated to cost approximately $385 million, will be capable of processing 850 million cubic feet of gas per day. It is designed to process production from six anchor fields and has excess payload capacity to tie back up to 10 additional fields.
Cal Dive says the platform is well underway with all key engineering and fabrication contracts already in place. Installation of the platform is scheduled for late 2006 and first production is expected in 2007.
Martin Ferron, Cal Dive President and Chief Operating Officer, stated, "With our involvement at the Marco Polo TLP and now the Independence Hub platform, we believe this demonstrates the repeatability of our Production Facilities business segment model. This model involves the provision of floating production systems on a fixed demand payment plus tariff basis, while providing opportunities for both marine contracting work and proven undeveloped (PUD) reservoir acquisitions."
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