Inergy Midstream To Build Interstate Gas Pipeline

March 2012, Vol. 239 No. 3

Inergy Midstream, L.P., a subsidiary of Inergy, L.P. plans to jointly market and develop a new interstate natural gas pipeline known as the Commonwealth Pipeline with affiliates of UGI Corporation (UGI) and WGL Holdings, Inc. (WGL).

The proposed 200-mile, 30-inch pipeline is expected to transport at least 800,000 Dth/d of natural gas when it is placed into service; and affiliates of UGI and WGL are expected to execute precedent agreements to become anchor shippers on the pipeline. The y anticipate placing the pipeline into service in 2015.

Commonwealth Pipeline will extend from the southern terminus of Inergy Midstream’s MARC I pipeline in Lycoming County, PA through UGI’s utility service areas in central and eastern Pennsylvania to a point of interconnection with WGL’s gas distribution system near Rockville, MD. The pipeline will connect demand centers in the Mid-Atlantic region, including Washington DC, Baltimore, and Philadelphia to supplies of natural gas production from across Pennsylvania while providing a more cost-effective transportation path versus traditional routes.

The pipeline is expected to cross and interconnect with several interstate pipelines along its route, providing customers greater supply diversity while providing producers direct access to expanding markets that are currently served only through legacy interstate pipelines.

A non-binding open season is scheduled to be announced to determine shipper interest in acquiring capacity on the proposed pipeline.