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2015 U.S. Natural Gas Pipeline Project Report

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Relieving transportation constraints in the Northeast continues to be a driving force in pipeline expansion in the United States. Over the next five years, the Northeast and Midwest account for several billion dollars in investment and hundreds of miles of pipelines to transport natural gas from the Appalachian Basin to dense population areas. Pipeline companies are rushing to answer the call for increased supply of natural gas and related products, such as liquefied natural gas (LNG) and natural gas liquids (NGLs).

In addition to the large number of projects in the Northeast, there has been progress on the long delayed Alaska LNG Project, as well as initiatives to improve export capabilities. Judging from the following projects, the pipeline industry will see strong activity through 2019 and beyond.

Aegis Pipeline
Location: Texas, Louisiana
Stakeholder(s): Enterprise Products Partners LP

Overview: Enterprise completed construction of the second segment of the Aegis pipeline on Sept. 2. The new 48-mile pipeline from Beaumont, Texas, to Lake Charles, Louisiana, joins the initial 60-mile segment currently in service to provides ethane transportation to petrochemical facilities between Mont Belvieu, Texas, and Lake Charles. The final leg of the 270-mile Aegis system will extend the pipeline from Lake Charles to the Mississippi River and is expected to be completed by the end of 2015. Combined with Enterprise’s existing South Texas system, Aegis will provide shippers with access to a 500-mile ethane header system between Corpus Christi, Texas, and the Mississippi River in Louisiana. The Aegis pipeline is supported by customer commitments in excess of 300,000 barrels per day (bpd) that ramp up over the next four years. The capacity of the pipeline can be expanded to approximately 400,000 bpd with additional pumps.

Alaska LNG Project
Location: Alaska
Stakeholder(s): Alaska Gasline Development Corp. (AGDC), ExxonMobil, BP, ConocoPhillips and TransCanada

Overview: In February, the stakeholders for the Alaska LNG Project submitted a series of draft environmental and socioeconomic reports to FERC as part of the pre-filing process to approve the project. The project is currently in the preliminary front end engineering and design (pre-FEED) phase of the project, which is expected to extend into 2016, with a gross cost of more than $500 million. Because the project is still in the planning phase and details are still under development, the reports only provide preliminary baseline data about the project and its potential impacts. As the design and scope become more defined, specific project impacts and their proposed mitigation measures will be included in second drafts of the resource reports. The input collected will be used to prepare a project final permit application, currently anticipated to occur in late 2016. Once the formal application is filed, FERC will begin developing an Environmental Impact Statement. The U.S. Department of Energy issued a Free Trade Agreement export authorization to the project in November 2014.

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Algonquin Incremental Market (AIM) Project
Location: New York, Connecticut, Rhode Island and Massachusetts
Stakeholder(s): Spectra Energy

Overview: The proposed project includes the construction of 20.1 miles of 42-in. diameter mainline take-up/relay and new pipeline in Connecticut and New York (includes a new 0.7-mile HDD crossing of the Hudson River in New York), 9.1 miles of 16-inch diameter take-up/relay pipeline in Connecticut, 1.3 miles of 12-in. diameter loop pipeline in Connecticut, 2 miles of 36-in. diameter loop extension pipeline in Connecticut and 5.1 miles of new 16- and 24-in. diameter lateral pipeline in Massachusetts. In addition, the project will include six new compressor units for a total of 81,620 additional horsepower at five existing compressor stations in New York, Connecticut and Rhode Island, modification to an existing compressor station in Connecticut, construction of one new meter station in Connecticut and two new meter stations in Massachusetts and modifications to existing meter stations in New York, Connecticut and Massachusetts. The project will expand pipeline capacity of the existing Algonquin Gas Transmission system up to 342 million cubic feet per day (MMcf/d). Construction is under way. The AIM Project is being built over two years and will be ready to safely deliver new supplies of much needed domestic natural gas to the Northeast by November 2016.

Constitution Pipeline
Location: Pennsylvania, New York
Stakeholder(s): Williams, Cabot Oil & Gas, Piedmont Natural Gas and WGL Holdings

Overview: The approximately 124-mile Constitution Pipeline is being designed with a capacity to transport 650 MMcf/d of natural gas (enough natural gas to serve approximately 3 million homes). Buried underground, the 30-in. pipeline would extend from Susquehanna County, Pa., to the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in Schoharie County, N.Y. The proposed project route stretches from Susquehanna County, Pa., into Broome County, N.Y., Chenango County, N.Y., Delaware County, N.Y., and terminates in Schoharie County, N.Y. FERC approved the project in December 2014 and construction is under way, with a target in-service date of late 2016.

Constitution Pipeline
Location: Pennsylvania, New York
Stakeholder(s): Williams, Cabot Oil & Gas, Piedmont Natural Gas and WGL Holdings

Overview: The approximately 124-mile Constitution Pipeline is being designed with a capacity to transport 650 MMcf/d of natural gas (enough natural gas to serve approximately 3 million homes). Buried underground, the 30-in. pipeline would extend from Susquehanna County, Pa., to the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in Schoharie County, N.Y. The proposed project route stretches from Susquehanna County, Pa., into Broome County, N.Y., Chenango County, N.Y., Delaware County, N.Y., and terminates in Schoharie County, N.Y. In February, FERC issued a draft Environmental Impact Statement (EIS). Pending final approval, the target in-service date is late 2015 or early 2016.

Leach XPress Project
Location: Ohio, West Virginia
Stakeholder(s): Columbia Pipeline Group

Overview: The proposed Leach XPress project involves construction of approximately 160 miles of natural gas pipeline and compression facilities in southeastern Ohio and West Virginia’s northern panhandle. The roughly $1.4 billion investment will enable the safe transport of approximately 1.5 billion cubic feet (Bcf) of natural gas from the heart of the Appalachian supply basin to natural gas consumers served by the Columbia Gas and Columbia Gulf pipeline systems. Columbia anticipates initiating construction in late 2016, with a targeted in-service date during the second half of 2017.

NEXUS Gas Transmission
Location: Ohio, Michigan, Chicago, Ontario
Stakeholder(s): DTE Energy and Spectra Energy

Overview: To address pipeline transportation infrastructure needs in the upper U.S. Midwest and eastern Canadian regions, the proposed NEXUS Gas Transmission (NGT) system will move natural gas supplies from Appalachian shale plays and serve local distribution companies, power generators and industrial users in these markets. The NGT project will originate in northeastern Ohio, include approximately 250 miles of large diameter pipe and be capable of transporting at least 2 Bcf/d of natural gas. As proposed, the path will utilize both existing and expansion capacity on the DTE Gas transportation system and the Vector Pipeline System to access Michigan markets, Chicago and the Dawn Hub in Ontario. The initial project will include interconnects with Texas Eastern Transmission LP and Tennessee Gas Pipeline Co. LLC in the Appalachian Basin with DTE Gas Michigan Consolidated Gas Co. and Consumers Energy in Michigan and with the Enbridge Tecumseh storage facility and the Union Gas Ltd. Dawn Hub. Additional delivery points across northern Ohio, southeastern Michigan, Chicago and southwestern Ontario will be added as necessary based upon shipper interest. The project is in FERC’s pre-fil stage, and the stakeholders were recently granted court approval to conduct surveying in Ohio. Pending approval, the project is expected to be in-service by the end
of 2017.

Ohio Pipeline Energy Network (OPEN)
Location: Ohio (Columbiana, Carroll, Jefferson, Belmont and Monroe counties)
Stakeholder(s): Texas Eastern Transmission LP (Spectra Energy)

Overview: The project is designed to provide pipeline transportation capacity to deliver new incremental production from the emerging Utica Shale and Marcellus Shale plays to growing and diverse markets in the Midwest, Southeast and Gulf Coast. The project will consist of approximately 76 miles of new 30-in. diameter mainline pipeline and associated pipeline support facilities in Columbiana, Carroll, Jefferson, Belmont and Monroe counties, Ohio, including a new compressor station. Reverse flow modifications at existing compressor stations along Texas Eastern’s existing mainline will be located in Ohio, Kentucky, Mississippi and Louisiana. Approximately, 35 miles (49 percent) of the proposed pipeline facilities will be either within or adjacent to existing transmission line or pipeline right of way. OPEN will provide 550 MMcf/d of pipeline transportation capacity to deliver new incremental production from the emerging Utica and Marcellus shale plays to growing and diverse markets in the Midwest, Southeast and Gulf Coast. Spectra has conducted an open season to seek interest in the OPEN project and has agreements in place with an anchor shipper. OPEN is currently under construction and expected to be completed by the end
of 2015.

Prairie State Pipeline
Location: Illinois
Stakeholder(s): Tallgrass Development LP and AGL Resources

Overview: The proposed Prairie State Pipeline is a 140-mile, large diameter pipeline that will move gas from supply connections in central Illinois to the Chicago Market Center and points in between, with an expected capacity between 1.2 and 1.5 Bcf/d and will include new compressor stations and multiple receipt and delivery points along its route. The pipeline will provide direct access to delivery points, large storage fields with significant injection capacity and several city gates that provide diverse and year round demand. Average daily demand for the points along this pipeline is estimated to exceed 3.5 Bcf/d, with peak day winter demand at up to triple that level. The proposed route for the pipeline originates in Douglas County, Illinois, with potential receipt points at Rockies Express, Trunkline and Panhandle Eastern, and continuing up through central Illinois and terminating in the Chicago Market Center at anticipated interconnects with Nicor Gas, Peoples Gas Light and Coke, Ameren, North Shore Gas Co., ANR Pipeline, Natural Gas Pipeline Co. of America, Northern Border Pipeline, Alliance Pipeline, Horizon Pipeline and Guardian Pipeline. Pending shipper commitments and regulatory approval, the project is expected to be in service by November 2017.

Sabal Trail Transmission
Location: Alabama, Georgia and Florida
Stakeholder(s): Sabal Trail Transmission LLC, a joint venture of Spectra Energy Corp. and NextEra Energy Inc.

Overview: The proposed Sabal Trail project includes approximately 500 miles of 24- and 36-in. diameter pipeline with a target capacity of more than 1 Bcf/d. The pipeline will serve transportation service Florida Power & Light’s power generation needs, and Sabal Trail has agreed to provide transportation services to Duke Energy of Florida (DEF) for its proposed power plant to be built in Citrus County, Florida. This new pipeline infrastructure will also benefit the Southeast region of the United States by making available additional supplies and new energy infrastructure to support other regional power generators and the growing demand for clean-burning natural gas. FERC issued a notice to begin environmental review in February. The planned in-service date for Sabal Trail is May 2017.

South Eddy Project
Location: New Mexico
Stakeholder(s): Enterprise Products Partners LP

Overview: On Sept. 30, Enterprise announced plans to construct a new cryogenic natural gas processing plant in Eddy County, New Mexico and associated natural gas and natural gas liquid (NGL) pipeline infrastructure to facilitate growing production in the Delaware Basin. The South Eddy natural gas processing plant will have an initial capacity of 200 MMcf/d of natural gas, with the potential for future expansions. Upon completion, this will bring Enterprise’s total natural gas processing plant capacity in the Delaware Basin to 400 MMcf/d. To supply the new plant, Enterprise plans to construct approximately 80 miles of natural gas gathering pipelines to complement its existing 1,500 miles of natural gas pipelines located in the Delaware Basin. The company will also build a 7
5-mile, 12-in. diameter NGL pipeline from the South Eddy plant to the company’s Hobbs fractionation and storage facility in Gaines County, Texas. Through the connection at Hobbs, customers will have access to Enterprise’s integrated network of pipelines linking them to the company’s NGL fractionation and storage complex in Mont Belvieu, Texas.
Additionally, Enterprise plans to construct pipelines to deliver residue gas from the South Eddy plant to multiple third party pipelines. These assets are expected to begin operations in the first quarter of 2016.

Texas Eastern Appalachia to Market 2014 (TEAM 2014)
Location: Pennsylvania, West Virginia, Ohio, Kentucky, Tennessee, Alabama and Mississippi
Stakeholder(s): Spectra Energy

Overview: The TEAM 2014 Project will expand the Texas Eastern system to accommodate increased natural gas production from the Appalachian region and deliver these critically needed natural gas supplies to diverse markets in the Northeast, Midwest, Southeast and Gulf Coast, increasing capacity by approximately 600 MMcf/d. The project will involve the construction of approximately 33.6 miles of various segments of new 36-in. diameter pipeline loop and related aboveground facilities in Fayette, Perry, Dauphin, Lebanon and Berks counties, Pennsylvania, as well as the installation of four new compressor units and associated facilities at the existing Delmont, Armagh and Entriken compressor stations in Pennsylvania. Modifications and maintenance work at 41 existing facility locations along Texas Eastern’s natural gas transmission system in Pennsylvania, West Virginia, Ohio, Kentucky, Tennessee, Alabama, and Mississippi will allow for bi-directional flow on the Texas Eastern system. The project is expected to be completed and in service by the end of the year.

Transco Expansion Projects
Location: Northeast, Mid-Atlantic, Southeast
Stakeholder(s): Williams

Overview: Williams has proposed a number of major expansion and maintenance projects to its Transco pipeline system to improve natural gas supply to the eastern and southeastern United States. Northeast projects include the Atlantic Sunrise (178 miles of greenfield pipe, 15 miles of looping, 2.5 miles of replacement) supplying with 1.7 Bcf/d to be in service by the second half of 2017; the Northeast Connector supplying 100 MMcf/d to be in service by the end of this year; the 3.2-mile Rockaway Delivery Lateral supplying 647 MMcf/d to be in service by the end of this year; the 30-mile Leidy Southeast project supplying 525 MMcf/d to be in service by December 2015; the 10-mile Rock Springs Lateral supplying 192 MMcf/d to be in service by August 2016; and the Garden State Expansion supplying 180 MMcf/d to be in service by Spring 2015. In the Mid-Atlantic, the 100-mile Virginia Southside project will provide 270 MMcf/d to be in service by September 2015. Southeast projects include Mobile Bay South III supplying 225 MMcf/d to be in service by April 2015; the 43-mile Hillabee Expansion supplying 1.13 Bcf/d to be built in three phases and in service by May 2017, May 2020 and May 2021; the 106-mile Dalton Expansion supplying 448 MMcf/d to be in service by May 2017; and the 8-mile Gulf Trace supplying 1.2 Bcf/d to be in service the second quarter of 2017.

Utica Marcellus Texas Pipeline
Location: Kentucky, Louisiana, Mississippi, Ohio, Pennsylvania, Tennessee and Texas
Stakeholder(s): Kinder Morgan Energy Partners, MarkWest Utica EMG LLC and Targa Resources Partners LP

Overview: Formerly known as the Y-Grade Pipeline Project, the Utica Marcellus Texas Pipeline (UMTP) is a joint venture between Kinder Morgan and MarkWest that will transport Y-grade NGLs from the Utica and Marcellus shale plays to the Texas Gulf Coast. The project will involve converting more than 1,000 miles of Kinder Morgan’s 24- and 26-in. Tennessee Gas Pipeline system, currently in natural gas service to NGL service, and the construction of approximately 200 miles of new pipeline to extend the Y-grade pipeline from Natchitoches, Louisiana, to a proposed Kinder Morgan joint venture fractionation facility with Targa Resources that has existing facilities at Mont Belvieu, Texas. UMTP will extend from Mercer and Harrison counties, Pennsylvania, to Mont Belvieu. The facilities will be located adjacent to Targa’s existing fractionation facilities at Mont Belvieu and will provide fractionation services for customers of UMTP of up to approximately 150,000 bpd and potentially serve up to 400,000 bpd of maximum pipeline capacity over time. Kinder Morgan would own at least 75 percent of the NGL pipeline and MarkWest Utica EMG would have the option to invest up to 25 percent. Kinder Morgan would operate the pipeline. The pipeline is expected to be in service by the second quarter 2017.

This is not a comprehensive list of the natural gas related pipeline projects in the United States. For updates regarding ongoing projects, refer to the Project Roundup on page 14 and published in every issue.

North American Oil & Gas Pipelines provides quarterly updates of oil and gas pipeline projects in the United States in Canada. Previous reports were published this year in February, May and August. The next update will be February 2015, covering Canadian oil pipeline projects.

Bradley Kramer is managing editor of North American Oil & Gas Pipelines. Contact him at bkramer@benjaminmedia.com.

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