Northeast Shale Gas Development Drives Pipeline Construction
After a brutal winter last year, the Northeast has become a hotbed of pipeline activity. Driven by increased demand for gas-fired power generation and concerns from consumers looking to heat their homes and businesses, pipeline activity has ramped up to provide more capacity to alleviate bottlenecking.
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). 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.
In addition to the projects in the Northeast, there has been progress on the long delayed Alaska LNG Project, as well as initiatives to improve export capabilities along the Pacific Coast to meet growing demand in Asia. Judging from the following projects, the oil and gas pipeline industry will see heavy activity through 2019 and beyond.
Access Northeast Project
Location: New England
Stakeholder(s): Spectra Energy Corp., Spectra Energy Partners and Northeast Utilities
Overview: The Access Northeast project is designed to meet growing demand for natural gas in New England and address critical supply challenges in the region. The project was outlined by Spectra Energy in a June 27 letter to the New England States Committee on Electricity (NESCOE) and is estimated to cost roughly $3 billion and has an anticipated in-service date of November 2018. Spectra Energy and Northeast Utilities (NU) will work with electric and gas industry representatives, including ISO-NE and NESCOE, to establish the levels of firm natural gas supply required to ensure both generation reliability and LDC demand growth. Over the past 15 years, natural gas-fired generation has grown from serving 15 percent of New England’s annual electric requirements to serving approximately half. At the same time, tens of thousands of New England homes and businesses have converted to natural gas heating, while pipeline capacity into the region has not grown. In the bitterly cold first quarter of 2014, gas demand for heating customers rose significantly, causing a shortage of gas available for electric generation. Older coal and oil plants filled in the gap, forcing prices to skyrocket. Access Northeast will enable new, efficient gas generation to operate more frequently during cold winter weather. This expansion will complement Spectra Energy’s Algonquin Incremental Market (AIM) and Atlantic Bridge projects, expected to be in service by the winter of 2016-2017 and November 2017, respectively.
Location: Texas, Louisiana
Stakeholder(s): Enterprise Products Partners LP
Overview: The Aegis pipeline is a new 270-mile pipeline header system that will deliver ethane to petrochemical plants in the U.S. Gulf Coast region. On Sept. 29, Enterprise announced that construction was complete on the first segment of the pipeline, a 60-mile section of 20-in. diameter pipeline between Mont Belvieu and Beaumont, Texas, and ready to make ethane deliveries to petrochemical customers. Once complete, the Aegis pipeline will create a 500-mile header system that stretches from Corpus Christi, Texas, to the Mississippi River in Louisiana. Including Enterprise’s existing South Texas infrastructure, this system is now in service from Corpus Christi to Beaumont. The remainder of the Aegis pipeline will be completed in two phases. The next segment between Beaumont and Lake Charles, Louisiana, is scheduled to be completed in the third quarter of 2015. The final segment from Lake Charles to the Mississippi River is expected to be completed by the end of 2015. Aegis will have a capacity expandable to 425,000 barrels per day (bpd). The pipeline system is expected to be a major ethane supply artery available to more than 20 petrochemical plants that are expected to be in operation along the U.S. Gulf Coast by 2020. These plants are expected to represent more than 90 percent of domestic ethylene production capacity by 2020. The Aegis Pipeline is supported by long-term commitments with shippers who have executed agreements in excess of 200,000 bpd. Enterprise continues to receive strong interest for additional capacity.
Alaska LNG Project
Stakeholder(s): Alaska Gasline Development Corp., BP PLC, ConocoPhillips Co., Exxon Mobil Corp. and TransCanada Corp.
Overview: In October 2012, Alaska Gov. Sean Parnell announced that a team of energy companies may invest up to $65 billion for an 800-mile, large diameter natural gas pipeline from the North Slope region to export to markets in the Pacific Rim. In addition to the pipeline, the proposed project facilities include a liquefaction facility in the Nikiski area on the Kenai Peninsula, up to eight compression stations, at least five take-off points for in-state gas delivery, a gas treatment plant located on the North Slope and transmission lines to transport gas from Prudhoe Bay and Point Thomson to the gas treatment plant. An application for an LNG export license to the U.S. Department of Energy was submitted in July for the project. In September, the project stakeholders submitted a formal request to the U.S. Federal Energy Regulatory Commission (FERC) to start the pre-file process, marking a major milestone for the long delayed project and setting the stage for the activity associated with the environmental review required for the pipeline route siting, design and permitting for construction of the proposed project. Over the summer, field workers conducted a portion of the project’s $500 million
pre-front-end engineering design (pre-FEED) phase, collecting data necessary to support requisite environmental permitting for the project and to support the routing and siting of project facilities. The majority of the work was focused along the pipeline route from Livengood to the proposed LNG liquefaction facility site in Nikiski.
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). From June 2013 through February 2014, Algonquin filed a formal application on Feb. 28 for FERC authorization to construct and operate the AIM Project, which Spectra expects to be completed by November 2016.
Bronco Plant NGL Pipeline
Stakeholder(s): ONEOK Partners
Overview: The Bronco natural gas processing plant, a 100 MMcf/d facility and related infrastructure are expected to cost up to $305 million and include up to $190 million for the construction of the Bronco natural gas processing plant, $45 million to $60 million for construction of a 65-mile, 10-in. NGL pipeline to connect the Bronco Plant to ONEOK Partners’ Bakken NGL Pipeline lateral, currently under construction and $40 million to $55 million for the construction of related natural gas infrastructure. The Bronco plant will expand the ONEOK’s natural gas gathering and processing and NGL gathering infrastructure in Campbell and Converse counties, Wyoming, and is supported by long-term dedications of more than 130,000 net acres. The project is expected to be completed during the third quarter 2016.
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
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 per day (Bcf/d) of natural gas. As proposed, the path will use 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 needed.
Location: New York, Pennsylvania, Massachusetts, New Hampshire and Connecticut
Stakeholder(s): Tennessee Gas Pipeline Company LLC (TGP), a subsidiary of Kinder Morgan Energy Partners LP
Overview: The proposed Northeast Energy Direct Project will upgrade Tennessee Gas Pipeline’s existing pipeline system in the Northeast and is a combination of the company’s Pennsylvania to Wright, New York, and Wright, New York, to Dracut, Massachusetts, projects. The proposed Pennsylvania to Wright, New York, portion of the project includes the construction of approximately 135 miles of greenfield pipeline from the existing TGP line in Susquehanna County, Pennsylvania, to the existing TGP line in Schoharie County, New York. The project also includes the construction of a 9-mile and a 23-mile loop along the existing TGP line in Bradford and Susquehanna counties in Pennsylvania. Additionally, the project will include the upgrade of an existing compressor stations and construction of three new compressor stations. The proposed Wright, New York, to Dracut, Massachusetts, segment includes the construction of approximately 52 miles of pipeline collocated with TGP’s existing system and 125 miles of greenfield pipeline, additional meter stations, compressor stations and modifications to existing facilities in New York, Massachusetts, Connecticut and New Hampshire. Approximately 73 miles of pipeline laterals and loops are planned to be constructed in Massachusetts, Connecticut and New Hampshire. The Northeast Energy Direct Project is being developed to meet increased demand and alleviate bottlenecking in the northeastern United States for transportation capacity for natural gas. Pending regulatory approval, the project is estimated to be in service by November 2018.
Northwest Expansion Projects
Location: Pacific Northwest
Overview: Williams has proposed a number of major expansion and maintenance projects to its Northwest Pipeline system to improve service to the western United States and provide export capabilities to the Asian markets. The projects include the 4-mile South Seattle Delivery Lateral supplying 68 MMcf/d capacity in Seattle that was placed into service last year; the 232-mile Pacific Connector Gas Pipeline Project to supply 1 MMcf/d capacity to the Pacific Northwest and Asia to be in service by the end of 2017; and the 140-mile Washington Expansion Project to supply incremental 750 MMcf/d capacity to the Pacific Northwest to be in service by the end of 2018.
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 550 MMcf/d of pipeline transportation capacity to deliver new incremental production from the Utica 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. The project has secured an anchor shipper. Texas Eastern submitted a formal application to FERC on Jan. 31. Estimated completion date is set for the end of 2015.
Prairie State Pipeline
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 75-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
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.
Utica To Ontario Pipeline Access (UTOPIA) Project
Location: Ohio, Michigan, Ontario
Stakeholder(s): Kinder Morgan Energy Partners, L.P.
Overview: On Sept. 29, Kinder Morgan announced it received a long-term transportation agreement from NOVA Chemicals Corp. to transport ethane and ethane-propane mixtures from the prolific Utica shale area through the UTOPIA project. Kinder Morgan Cochin is planning to develop, construct, own and operate a 240-mile, 12-in. diameter pipeline from Harrison County, Ohio, to Kinder Morgan’s Cochin Pipeline near Riga, Michigan, where the company would then move product eastward to Windsor, Ontario. The pipeline would transport previously refined or fractionated natural gas liquids (NGLs), including ethane and propane, with an initial 50,000 bpd of capacity, which is expandable to more than 75,000 bpd. Pending a successful open season and permitting and regulatory approvals, UTOPIA is expected to be in service by early 2018.
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 email@example.com.