May 2017, Vol. 244, No. 5

Projects

Projects

FERC Confirms PennEast Pipeline Poses Minimal Environment Impact

The Federal Energy Regulatory Commission (FERC) last month issued a final environmental impact statement (EIS) to PennEast Pipeline, stating the 120-mile natural gas pipeline can be built with little impact on the environment. The EIS is the last major federal regulatory hurdle for the pipeline prior to an expected order from FERC Commissioners that would result in approval of the project, through a certificate of public convenience and necessity, most likely this summer.

With the decision, two government agencies have affirmed PennEast Pipeline’s construction and ongoing operations will not harm the environment, including waterways. The other validation came in February from the Pennsylvania Department of Environmental Protection, which issued a water quality certification as required by section 401 of the Federal Clean Water Act.

“New infrastructure like PennEast Pipeline is not only far better for our environment than relying on other less-clean fuels, but also for reducing electric and natural gas bills for families and businesses,” said Dat Tran, chair of the Board of Managers for PennEast Pipeline.

Construction of the PennEast Pipeline project is expected to begin in the second half of 2018. The 36-inch pipeline is over 90% subscribed under long-term contracts with local gas utilities, power generators and other energy customers. Local customers will benefit from energy that is scheduled to be about 30% less expensive than natural gas supplies from the Gulf of Mexico, which have traditionally fueled the Northeast.

New York State DEC Rejects Proposed Gasline

The New York state Department of Environmental Conservation last month turned down a request for a water quality certificate for Natural Fuel Gas Supply Corp.’s proposed 97-mile Northern Access Pipeline from Pennsylvania to Elma, determining that the pipeline posed too big a threat to water quality and wildlife. The DEC said National Fuel’s project specifications failed “to avoid adverse impacts to wetlands, streams and fish and other wildlife habitat” in crossing about 190 streams through Allegany, Cattaraugus and Erie counties.

“What is perhaps the most troubling aspect of this decision is that DEC waited literally until the 11th hour to issue this denial, even though we had detailed discussions with DEC staff over a 34-month period and undertook detailed engineering and environmental studies at the agency’s request to support the stream-crossing techniques that now form the basis of their denial,” according to a statement from Ronald J. Tanski, president and CEO of National Fuel Gas Supply Co.

Tanski said his company provided DEC “voluminous detailed studies” showing effects on streams would be “temporary and minor” and questioned the agency’s approval of several other projects it contends had far more impact to the environment.

Trump Administration Approves Keystone XL Pipeline 

The U.S. Department of State signed and issued a presidential permit to construct the Keystone XL Pipeline.

“This is a significant milestone for the Keystone XL project,” said Russ Girling, TransCanada’s president and CEO. “We greatly appreciate President Trump’s administration for reviewing and approving this important initiative.”

The company will continue to engage key stakeholders and neighbors throughout Nebraska, Montana and South Dakota to obtain the necessary permits and approvals to advance this project to construction. In conjunction, TransCanada discontinued its claim under Chapter 11 of the North American Free Trade Agreement (NAFTA) and will end its U.S. constitutional challenge.

Open Season Underway for Midcon Transport Pipeline

Tall Oak Midstream II and its affiliates and subsidiaries have begun a non-binding open season for the Midcon Transport residue gas pipeline project.

The open season seeks commitments for firm transportation capacity from Tall Oak’s Carmen Plant in Alfalfa County, OK to deliveries at the Canadian-Blackwell CDP on Southern Star Central Gas Pipeline. The Carmen Plant is connected to Panhandle Eastern Pipe Line and ONEOK Gas Transportation for residue gas deliveries. Tall Oak’s customers requested additional residue gas takeaway capacity and market flexibility through a proposed interconnect with Southern Star Central Gas Pipeline.

The preliminary scope of the project consists of 8 miles of 12-inch or 16-inch pipeline to the interconnect point. Following the completion of the open season, Tall Oak will refine the preliminary scope of the project with a project design that is capable of accommodating the level of shipper nominations received.

Howard Energy Partners Pitches Sabine Bayou Pipeline

Howard Midstream Energy Partners subsidiary, GT Pipeline, launched a binding open season to secure new shipper commitments for the Sabine Bayou Line, a new pipeline system near Port Arthur, TX.

The 6-mile Sabine Bayou Line is a common carrier, bidirectional pipeline system that will transport regular gasoline, premium gasoline, and gasoline blend stocks to and from origin and destination points at terminal facilities in the West Port Arthur area. The system will provide transportation services from the West Port Arthur Tank Farm to the GT Logistics Main Tank Farm, and from the GT Main Tank Farm to the GT Logistics Shoreside Tank Farm.

The pipeline system will be designed for a peak flow rate of 7,500 barrels per hour (bph). The section flowing between West Port Arthur Tank Farm and the GT Logistics Main Tank Farm will be 2.45 miles of 16-inch pipe, with a maximum capacity of 128 MMbpd. The section flowing between the GT Main Tank Farm and the GT Logistics Shoreside Tank Farm will be 4.2 miles of 20-inch pipe with a maximum capacity of 180 MMbpd.

NAmerico Energy Moves Forward with Pecos Trail Pipeline

NAmerico Energy Holdings plans to build the Pecos Trail Pipeline, a 468-mile intrastate natural gas system starting in West Texas and ending at various points around Corpus Christi, TX. The 42-inch natural gas line will transport 1.85 Bcf/d from the Permian Basin to the Texas Gulf Coast.

NAmerico is developing the system in partnership with Cresta Energy Fund I, a newly formed investment fund focused on energy infrastructure.

The Pecos Trail Pipeline is expected to be operational in 2019, with anticipated deliveries into Spectra Energy’s Valley Crossing Pipeline, The NET Mexico Header and the Cheniere Energy Corpus Christi LNG Header system, subject to shipper commitments.

Eastern System Upgrade Gets Favorable FERC Assessment 

The Federal Energy Regulatory Commission (FERC) released an environmental assessment for Millennium Pipeline’s Eastern System Upgrade Project, saying the construction and operation of the project would not significantly affect the quality of the environment.

The project consists of constructing or modifying the following facilities in New York: 7.8 miles of 30-inch and 36-inch pipeline loop (Huguenot Loop) in Orange County, a new compressor station in Sullivan County, additional compression at the Hancock Compressor Station in Delaware County, modifications at the Westtown Meter Station and Wagoner Interconnect in Orange County and modifications at the Ramapo Meter Station in Rockland County.

The project would provide about 223,000 Dth/d of firm transportation service from Millennium’s Corning Compressor Station to an interconnect with Algonquin Gas Transmission LLC in Ramapo, NY.

Buckeye Plans Pipeline Construction Projects in Permian

Buckeye Partners is preparing for a binding open season in connection with the development of a new crude oil pipeline from the Permian Basin to Corpus Christi, TX. The pipeline is part of a series of potential investment projects Buckeye is pursuing in to enhance Permian Basin crude oil flows.

The proposed pipeline system, South Texas Gateway, would deliver crude oil and condensate from Wink and Midland, TX to the existing Buckeye refining and export facilities in Corpus Christi. The 24-inch pipeline would have a capacity of up to 400,000 bpd with multiple segregations.

Buckeye expects to hold a binding open season for the South Texas Gateway Pipeline during the third quarter, with an expected in-service date of 2019.

Saginaw Trail Pipeline Construction Gets Green Light

The Michigan Public Service Commission approved settlement agreements enabling Consumers Energy to build and operate the Saginaw Trail Pipeline in Saginaw, Genesee and Oakland counties.

Once completed, the 94-mile, 12-inch and 16-inch Saginaw Trail Pipeline will replace the existing Line 2800 pipeline;  the pipeline is expected to in service in 2022. Consumers Energy must file an annual report and plan requirements until the project is finished and work will not start until all necessary easements and permits have been acquired.

Midship Pipeline Proposes Mainline Pipeline

Midship Pipeline Co. LLC has signed precedent agreements with foundation shippers to support construction of the Midship Project and has launched a binding open season to solicit additional long-term commitments from shippers. The transactions contemplated by the precedent agreements are subject to satisfaction of various conditions.

The Midship Project includes 200 miles of 36-inch mainline pipeline, several laterals, compressor stations and interconnects that will provide receipts from STACK and SCOOP processing plants and deliveries to Bennington, OK, the TexOk hub near Atlanta, TX, and the Perryville Hub near Tallulah, LA.

Once finished, the Midship Project will create pipeline capacity of up to 1.4 MMDth/d of firm transportation to connect production from the emerging STACK and SCOOP resource plays in the Anadarko Basin in Oklahoma to growing Gulf Coast and Southeast markets.

Following the open season, the company plans to submit its official FERC 7C application and is targeting an in-service date of early 2019.

Kinder Morgan Plans Gulf Coast Express Pipeline 

Kinder Morgan Texas Pipeline began a non-binding open season for firm natural gas transportation service on its proposed Gulf Coast Express Pipeline Project, which will offer an outlet from the Permian Basin to the Texas Gulf Coast.

The project is designed to transport up to 1.7 MMDth/d of natural gas through about 430 miles of 42-inch pipeline from the area near Waha to Agua Dulce, TX. The pipeline will be operational in the second half of 2019, subject to shipper commitments.

Natural gas supply will be sourced into the project from multiple locations, including existing receipt points along Kinder Morgan’s KMTP and El Paso Natural Gas pipeline systems in the Permian Basin, a proposed interconnection with the Trans-Pecos Pipeline, and additional interconnections to both intrastate and interstate pipeline systems in the Waha area.

Deliveries of natural gas into the Agua Dulce area will include points into KMTP’s existing Gulf Coast network, Kinder Morgan-owned intrastate affiliates (KM Tejas and KM Border pipelines), the Spectra Valley Crossing pipeline, the NET Mexico header and other intrastate and interstate natural gas pipelines.

Enterprise to Build Shin Oak NGL Pipeline

Enterprise Products Partners will build a 571-mile pipeline to transport growing volumes of natural gas liquids (NGL) from the Permian Basin to Enterprise’s NGL fractionation and storage complex in Mont Belvieu, TX. The Shin Oak NGL Pipeline will originate at Enterprise’s Hobbs NGL fractionation and storage facility in Gaines County, TX.

The 24-inch pipeline will have an initial design capacity of 250,000 bpd, expandable to 600,000 bpd. The project is supported by long-term customer commitments and is expected to be in service in the second quarter of 2019.

In addition to mixed NGL supplies aggregated at the Hobbs facility, the Shin Oak pipeline will provide takeaway capacity for mixed NGLs extracted at natural gas processing plants in the Permian region, including two Enterprise facilities that began service in 2016 and the Orla I plant, which is scheduled to begin operations in the second quarter of 2018.