Following the crashing of oil, gas, and liquid commodity prices back in 2014, DCP Midstream has been working to reduce its sensitivity to commodity prices. This has been achieved by investing in fee-based growth projects, which has resulted in a 65% increase in fee-based gross margins so far this year.
The DCP 2.0 strategy, now in its fourth year, is focused on using technology to drive optimization and improve efficiencies throughout DCP Midstream’s portfolio of assets. These assets are located in some of the most prolific plays in the country, including the Permian Basin, Eagle Ford Shale, Scoop, and the Denver-Julesberg (D-J) Basin.
The D-J Basin in particular has been a standout play for the company this year as it experienced a double-digit year-over-year volume growth in the second quarter. This region is poised for even more growth following the recent announcement of a long-term agreement with Western Midstream Partners to provide up to 225 million cubic feet per day (MMcf/d) of incremental processing capacity by the middle of 2020.