December 2016, Vol. 243, No. 12
Projects
Projects
Williams Partners Revise Atlantic Sunrise In-Service Date
After revising the targeted in-service date for its Atlantic Sunrise pipeline expansion, Williams Partners L.P. now expects full service in mid-2018.
The Federal Energy Regulatory Commission’s (FERC) revised environmental review schedule set Dec. 30 for issuance of the final environmental impact statement (EIS). Following the receipt of all necessary regulatory approvals, Williams Partners expects to start construction of the Transco mainline facilities in mid-2017 to create a path from the northern part of the Transco system into its Southeast markets for the 2017-18 heating season.
“We continue to work with the FERC, state and other federal permitting agencies to secure the necessary approvals to construct this critical infrastructure project and connect consumers along the East Coast with Pennsylvania natural gas supplies,” said Rory Miller, senior vice president of Williams Partners’ Atlantic-Gulf operating area.
Once complete, the Atlantic Sunrise expansion will help alleviate infrastructure bottlenecks in Pennsylvania, connecting abundant Marcellus gas supplies with markets in the Mid-Atlantic and Southeast. The nearly $3 billion expansion is designed to increase deliveries by 1.7 Bcf/d. Williams Partners’ net investment in the project is expected to be $1.9 billion.
The preliminary project design includes 183 miles of new greenfield pipe (Central Penn North & Central Penn South), two pipeline loops of about 12 miles (Chapman Loop, Unity Loop), 2.5 miles of existing pipeline replacement, two new compressor facilities in Pennsylvania, and other facility additions or modifications in five states (Pennsylvania, Maryland, Virginia, North Carolina, South Carolina).
Penn State University researchers forecast the Atlantic Sunrise project will directly and indirectly support 8,000 jobs in the 10 Pennsylvania counties during construction, resulting in $1.6 billion in economic impact.
Chesapeake Utilities Announces its Largest Gas Pipeline Expansion
Chesapeake Utilities Corp. announced that Eastern Shore Natural Gas Co., its interstate natural gas transmission subsidiary, finalized precedent agreements with customers for its 2017 expansion project that will add significant firm transportation pipeline capacity in the region.
“This project is the single-largest expansion in Eastern Shore Natural Gas’ long history of providing natural gas,” said Michael P. McMasters, Chesapeake Utilities president and CEO. “Our company continues to invest in energy infrastructure throughout the Mid-Atlantic area. This project will increase the firm transportation deliverability to our region by 25%, supporting economic growth in the region.”
Precedent agreements have been signed by seven of ESNG’s existing customers which requested new firm transportation services. The expansion will provide over 60,000 Dth/d of additional firm gas transportation deliverability on the pipeline.
“This expansion of firm natural gas transportation capacity is a result of our ongoing commitment to providing new service and supply options for our customers,” said Stephen C. Thompson, president of Eastern Shore Natural Gas Company. “This will position us to meet growing market demand for reliable energy in the region, as evidenced by the record number of customers participating in the project.”
The project includes 23 miles of looping in Pennsylvania, Maryland and Delaware; upgrades to existing metering facilities; installation of an additional 3,550 hp compressor unit at the Daleville Compressor Station in Chester County, PA; 17 miles of new mainline extension and the addition of two pressure-control stations in Sussex County, DE. These new facilities are estimated to cost about $99 million.
ESNG intends to file its formal certificate application for the 2017 expansion project with FERC shortly, pending the completion of its ongoing pre-filing regulatory process. ESNG plans to start construction of the project in the second quarter and place the facilities in-service during the fourth quarter.
Spectra Energy’s AIM Project Begins Service
If present schedules held up, Spectra Energy’s Algonquin Incremental Market (AIM) project was to be placed in-service on Nov. 16. The project will provide 342,000 Dth/d of natural gas to local distribution companies and municipal utilities in Connecticut, Rhode Island and Massachusetts.
Expanding the pipeline capacity of Spectra Energy’s existing Algonquin Gas Transmission system, AIM will allow regional supplies from the Appalachian basin to flow into the Northeast.
The project required construction of 20.1 miles of 42-inch mainline take-up/relay and new pipeline in Connecticut and New York (a new 0.7 mile horizontal directional drill crossing of the Hudson River in New York); 9.1 miles of 16-inch take-up/relay pipeline in Connecticut; 1.3 miles of 12-inch loop pipeline in Connecticut; 2 miles of 36-inch loop extension pipeline in Connecticut; and 5.1 miles of 16-inch and 24-inch lateral pipeline in Massachusetts.
The project’s above-ground facilities required modifications to six existing compressor stations, adding 81,620 hp in New York, Connecticut and Rhode Island, and abandonment of four existing compressor stations. Algonquin also modified 24 existing meter and regulating stations, constructed three meter and regulation stations, and removed one meter station in New York, Connecticut and Massachusetts.
Shell Plans Ethane Pipeline in Marcellus, Utica Shale Plays
Shell Pipeline LP closed a binding open season Nov. 18 in connection with its proposed construction of the 94-mile Falcon Ethane Pipeline system. The pipeline will connect three major ethane source points within Pennsylvania and Ohio in the rich-gas portions of the Marcellus and Utica plays to a petrochemical plant in Monaca, PA.
Falcon’s initial pipeline capacity is expected to be 107,000 bpd of ethane. Shell expects to commission the project in early 2020.
KBR Evaluates LNG Expansion in Singapore
KBR, Inc. is conducting a feasibility study that includes exploring the possible expansion of the Singapore LNG Corporation Pte Ltd.’s (SLNG) LNG terminal on Jurong Island in Singapore. SLNG was formed by Singapore’s Energy Market Authority (EMA) to develop, build and operate Singapore’s first LNG terminal.
Under terms of the contract, KBR will provide feasible conceptual solutions for SLNG’s consideration and create a design option that could be scalable in the long run. This work is expected to be performed over five months.
Tanker Loading Begins at 2nd Cheniere LNG Plant
Cheniere Energy Inc., which became the nation’s first and only exporter of shale gas in February, was cleared by federal regulators in October to start loading LNG tankers from a second plant at its landmark Sabine Pass terminal in Louisiana, reported Bloomberg.
Train 2, as the plant is known, began producing LNG on July 28 during the commissioning process. In late September, Trains 1 and 2 were shut in for planned work which was expected to last about four weeks. Each has the capacity to produce the equivalent of about 650 MMcf/d. Next year, the company plans to bring a third plant online and start commissioning a fourth.
Sabine Pass took in 119 Bcf of gas from April 1, which marked the start of the U.S. gas stockpiling season, through Sept. 9. During the same period, the country’s supply glut vs. the five-year average fell to 299 Bcf from 874 Bcf.
The Bloomberg report noted that by starting up two liquefaction plants, Cheniere will be able to take in fixed payments for 20 years from customers whether or not they decide to actually take any LNG from Sabine Pass.
Crestwood /SWEPI o Build Permian Gathering System
Crestwood Equity Partners LP entered into a long-term agreement with SWEPI LP, a subsidiary of Royal Dutch Shell plc, to construct, own and operate a natural gas gathering system in Shell’s operated position in the Permian-Delaware Basin.
The system will be owned through Crestwood’s previously announced joint venture with First Reserve. Crestwood estimates the full buildout of the gas gathering system will cost $180 million. Project development activities are underway with a targeted initial in-service date on or before July 1.
The initial gathering system is designed for production of 250 MMcf/d and will include 194 miles of low-pressure gathering lines, 36 miles of high-pressure trunk lines and centralized compression facilities to be expandable as production increases. Crestwood will provide gathering, dehydration, compression and liquids-handling services on a fixed-fee basis. Shell has the option to buy up to a 50% equity interest in the system prior to Sept. 1.
Grand Mesa Pipeline Completed On Time, Under Budget
NGL Energy Partners LP’s subsidiary, Grand Mesa Pipeline, LLC, began line fill for its new crude oil pipeline system from Weld County, CO to Cushing, OK. NGL CEO Mike Krimbill said the project is on time, under budget and ready for commercial operations.
Separately, Blackeagle Energy Services completed construction on the origin stations for the Grand Mesa Pipeline. The facilities near Lucerne and Riverside, CO will gather crude oil from Weld County and transfer it to NGL’s storage facility in Cushing.
EQT Buys Allegheny Valley Connector System
EQT Midstream Partners, LP acquired the Allegheny Valley Connector (AVC) transmission and storage system, along with several Marcellus gathering systems from EQT Corp. for $275 million. The AVC system includes 209 miles of transmission pipeline and 11 Bcf of working gas storage capacity.
The system has 450 MMcf/d of transmission capacity and is fully contracted for the winter season by Peoples Natural Gas, one of Pennsylvania’s largest natural gas distribution companies, through a firm reservation commitment that expires in 2034. EQM expects to invest $50 million in the AVC-related growth projects during the remainder of 2016 and into 2017.
Newly acquired gathering assets, consisting primarily of the Applegate, McIntosh, and Terra systems in Pennsylvania and the Taurus system in West Virginia, include 87 miles of gathering pipeline, an estimated 7,000 hp of compression and provide 370 MMcf/d of gathering capacity. EQT has committed to a total of 235 MMcf/d of firm capacity under a 10-year contract on the systems.
EQM expects to invest $105 million over the next several years to complete planned expansion projects, including installation of 20 miles of gathering lines and four compressor units with 20,000 hp of compression. Upon completion of the expansion projects, EQT’s total firm capacity will increase to 365 MMcf/d.
Separately, EQT Midstream Partners, LP began gas transportation service on the Ohio Valley Connector from northern West Virginia to Clarington, OH. The 37-mile pipeline, an extension of the Equitrans system, was certificated by FERC at 850 MMcf/d and is backed by a 20-year transportation service agreement with EQT Energy, LLC, an affiliate of EQT Corp., for 650 MMcf/d of firm transmission capacity. The Connector is expected to be accepting full nominations following a standard operational ramp-up period.
Buckeye Closes Open Season on Michigan/Ohio Expansion
Buckeye Partners, L.P.’s operating subsidiary, Buckeye Pipe Line Co., L.P., closed a binding open season for the second phase of its Michigan/Ohio Pipeline expansion project. The second phase will allow Buckeye to offer expanded transportation service of refined petroleum products from origin points in Woodhaven and Detroit, MI; Toledo, Findlay and Lima, OH; and Midland, PA to a destination point in the Altoona area in central Pennsylvania.
Buckeye intends to reverse a portion of its existing Laurel pipeline to facilitate the transportation of refined petroleum products from Pittsburgh to central Pennsylvania. The open season closed Oct. 18. Based on the positive commitment from prospective shippers, the project is expected to be completed before year-end 2018.
TransCanada Offers Tolling on Canadian Mainline
TransCanada Corp. closed a binding open season Nov. 11 for commitments on a new, long-term, fixed-price proposal to flow natural gas along the Canadian Mainline from the Empress receipt point in Alberta to the Dawn hub in southern Ontario.
The proposal is intended to allow Western Canadian Sedimentary Basin producers to use existing capacity on the Mainline to transport natural gas from the Nova Inventory Transfer market hub and access the eastern market trading hub at Dawn. The tolling arrangement will provide lower cost access to the high-value markets served by the Dawn hub. This proposal does not affect current contracts on the Mainline.
“TransCanada’s Canadian Mainline has been a critical piece of energy infrastructure for over 65 years, and has connected the country’s most prolific supply basins with North America’s highest value markets,” said Stephen Clark, TransCanada’s senior vice president and general manager, Canadian Natural Gas Pipelines.
The contract term for this service is 10 years with tolls ranging from $0.75/GJ to $0.82/GJ depending on the shippers’ contract volume commitments and a total subscription of 1.5 PJ/d. These tolls are inclusive of the abandonment surcharge and delivery pressure charge. Early termination rights are provided and can be exercised following the initial five years of service upon payment of an increased toll for the final two years of the contract.
The service is priced lower than current firm service tolls and does not include flexibility provisions such as diversions and alternate receipt points. Secondary deliveries along the Great Lakes Pipeline to Deward, Farwell, Chippewa, Rattle Run and Belle River Mills may be permitted subject to certain conditions.
Pipe Racks Delivered to Louisiana Chemical Complex
Dynamic Industries, Inc. recently completed the fabrication and load out of pipe rack modules for Fluor Technip Integrated (FTI) and Sasol North America. The pipe racks will become an integral part of Sasol’s Chemical Complex in Westlake, LA.
Completion of the petrochemical complex will roughly triple Sasol’s chemical production capacity in the U.S. and expand its position in the growing global chemical markets. The pipe racks were all fabricated and assembled at Dynamic’s New Iberia, LA facility.
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