Blue Racer Midstream Takes Over the Natrium Gas Processing and Fractionation Plant Serving the Marcellus And Utica Shale Plays

Blue Racer Midstream

DALLAS – August 12, 2013 – Blue Racer Midstream, LLC (“Blue Racer”) announced today that the company is now the owner and operator of the Natrium Natural Gas Processing and Fractionation Plant. Strategically located in the rich-gas region of the Utica Shale, the Natrium facility sits along the Ohio River in Marshall County, West Virginia. Natrium currently serves production from both the Marcellus and Utica Shale plays. Future expansions to the plant’s capacity are underway in response to the critical need for processing services in the Utica Shale.

Dominion Resources (NYSE: D) transferred ownership of the plant to Blue Racer on August 9, 2013, pursuant to Dominion’s agreement with Caiman Energy II, LLC (“Caiman”). Dominion and Caiman are co-owners of Blue Racer Midstream, a $1.5 billion joint venture to provide midstream services to rich-gas producers in the Utica Shale.

With cryogenic processing capacity of 200 million cubic feet per day (MMcf/d) already online, Natrium is the first large-scale processing plant to serve rich-gas production in the Utica Shale. Blue Racer has already started construction of a second 200 MMcf/d cryogenic processing plant. Natrium II will bring the facility’s total processing capacity to 400 MMcf/d by the end of the first quarter of 2014. Current liquids fractionation capacity at Natrium is 36,000 barrels per day (Bbls/d). Blue Racer has initiated plans to increase fractionation capacity to at least 59,000 Bbls/d as drilling activity in the Utica expands. Additions to processing and fractionation capacity at the Natrium site will occur as producer needs for midstream services increase.

CEO Perspective
“We are very pleased to be working with Caiman Energy on Blue Racer. The Utica Shale has tremendous potential to provide jobs and revenue for the people of Ohio, West Virginia and Pennsylvania, and we’re excited about playing a role in that,” said Thomas F. Farrell II, Dominion’s chairman, president and chief executive officer. “In recent months we have seen a rapid acceleration of drilling and permitting activity. Bringing Natrium online, transferring ownership to Blue Racer and initiating expansion plans are important milestones for Blue Racer, Utica producers and the region’s economy.”

“Our goal is to create the Utica Shale’s premier midstream company,” added Blue Racer’s CEO, Jack Lafield. “With 500 miles of gathering pipeline and significant processing and fractionation capacity already up and running, Blue Racer’s assets are uniquely situated to handle rich-gas volumes from all areas of the Utica Shale. As producers continue to delineate the play, Blue Racer will keep pace by providing top-tier customer service and the region’s best opportunity to gather and process rich gas and market NGLs. We are proud to be working alongside Dominion’s team, including its NGL marketing group, unquestionably the regional leader in providing access to liquids markets in the Northeast,” said Lafield, who is also the chairman and CEO of Caiman Energy.

About Blue Racer Midstream, LLC
Formed In December 2012, Blue Racer Midstream is a $1.5 billion joint venture between Caiman Energy II, LLC and Dominion (NYSE: D) dedicated to providing Utica Shale producers with midstream services and the ability to receive the highest value for their products. With midstream assets strategically located in the heart of the Utica and a robust expansion plan in place, Blue Racer's services include gathering, processing, fractionation, and natural gas liquids transportation and marketing.

Dominion contributed existing midstream assets to Blue Racer including 500 miles of Dominion East Ohio gathering lines that span the Utica Shale and the Natrium Processing Plant in Marshall County, West Virginia. Additional contributions of physical assets are expected in 2013 and 2014. Caiman’s contribution includes up to $800 million in equity capital commitments and the experience and expertise required to manage and expand Blue Racer’s asset base.

About Dominion
Dominion is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 27,000 megawatts of generation, 11,000 miles of natural gas transmission, gathering and storage pipeline, and 6,400 miles of electric transmission lines.  Dominion operates one of the nation's largest natural gas storage systems with 947 billion cubic feet of storage capacity and serves retail energy customers in 15 states.

About Caiman Energy II, LLC 
Caiman Energy is a midstream energy company focused on the design, construction, operation and acquisition of midstream assets. The company is currently focused on midstream projects in the Utica Shale and brings an initial $800 million in committed private equity capital to support the greenfield development of new gathering and processing assets in the Utica. Caiman’s equity backers include EnCap Flatrock Midstream, Williams Partners L.P. (NYSE: WPZ) and Highstar Capital.