UPDATE 1-SM Energy inks gas transportation deal with Energy Transfer

* Deal to transport and process gas produced from Eagle Ford

* Deal for 10 yrs

* ETP to provide up to 240,000 mmBtu/d transportation

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April 11 (Reuters) – Oil and gas company SM Energy Co
struck long-term service agreements with Energy Transfer
Partners’ Texas unit to transport and process gas
produced from the Eagle Ford shale field in South Texas.

The deal comes less than a month after Energy Transfer
Partners entered into a similar agreements with two producers in
Texas. [ID:nL3E7EM350]

ETC Texas Pipeline has committed to transport up to 240,000
million British thermal units per day over a ten-year term,
starting 2013.

“This new agreement with ETC provides additional, longer
term take-away capacity for our natural gas and natural gas
liquids as we continue to ramp up the development of our Eagle
Ford shale assets,” SM Energy Chief Executive Tony Best said.

Eagle Ford shale, whose current total production is
estimated at 80,000 barrels per day, contains crude oil and
natural-gas rich in liquids that can be stripped out and sold at
a premium.

SM Energy, which did not disclose any financial terms, said
the deal was fee based and will not require it to invest any
upfront capital.

Shares of SM Energy closed at $71.79 on Monday on the New
York Stock Exchange.
(Reporting by Thyagaraju Adinarayan; Editing by Sriraj
Kalluvila)

UPDATE 1-SM Energy inks gas transportation deal with Energy Transfer