Marcellus Producer Asks Approval of Atlantic Sunrise Pipeline

March 2016, Vol. 243, No. 3

Chief Oil & Gas LLC, one of the customers supporting Transcontinental Gas Pipe Line Co. LLC‘s proposed Atlantic Sunrise pipeline, said Marcellus producers are in desperate need and urged FERC to “promptly approve” the project.

“The Atlantic Sunrise project is a critical pathway to connect Marcellus production to markets along the Eastern Seaboard, and its timely construction is essential to meeting the market demands for the 2017 heating season,” Chief’s Senior Vice President of Marketing Andrew Levine wrote in a Feb. 4 letter to FERC Chairman Norman Bay and the other commissioners.

“Chief respectfully submits that the timely approval of the project is critical to meet the market demands and other wide-ranging benefits, including significant positive impacts on local economies where construction would occur and beyond,” Levine said. He said Chief and other companies have made substantial investments in gas exploration and development. Production has grown, but “transportation infrastructure has not kept pace.”

“The Atlantic Sunrise project will provide 1.7 million dekatherms per day of firm natural gas transportation capacity from northern Pennsylvania, which will help to alleviate this problem,” Levine said.

Chief has executed a binding precedent agreement with Transco for 420,000 Dth/d of firm service. The producer would use the service to move gas to market. Besides Chief, the Atlantic Sunrise project would serve Anadarko Petroleum Corp.‘s Anadarko Energy Services Co., Cabot Oil & Gas Corp., Inflection Energy LLC, MMGS, National Fuel Gas Co.‘s Seneca Resources Corp.,Southern Co.‘s Southern Co. Services Inc., Southwestern Energy Services Co. and WGL Holdings Inc.‘s WGL Midstream Inc. The shippers have committed to all of the project’s incremental capacity.

Chief asked FERC to issue an order approving the project no later than April 29 to allow Transco to put the project in-service by July 1, 2017.

“Commission approval by April 29, 2016, would allow Transco to maximize favorable construction and weather conditions to proceed promptly with construction,” Levine said. “Transco has further indicated that its proposed schedule considers environmental restrictions and employs construction methodologies that would ensure the project is constructed as expeditiously as practicable consistent with safe practices. The schedule would thus allow Transco to minimize adverse impacts that could result from a longer construction period.”

Transco applied for the project in March 2015 and estimated the project would cost almost $2.6 billion.

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