There is no clearer signal that midstream concerns are front and center for the energy sector than when those issues are raised organically by multiple company executives at an upstream conference. And so it was here at the Oil & Gas Investment Seminar (OGIS), which began April 9 in midtown Manhattan.
Many presenters, all C-suite officials, stressed that the most efficient and reliable way for their companies to ensure midstream connections that are correct in time and size was for them to handle it in-house. One executive offered a new term for the way independents are coming to view their midstream assets: “operational risk management.”
Several noted that they are working with outside midstream operators, but there was a strong sense overall that the consolidated midstream sector is now less concerned with the granularity of gathering. Into that vacancy several upstream producers are creating or expanding their own midstream subsidiaries or master limited partnerships (MLPs). In most cases those are also poised to add third-party gathering and processing.