In the first of two announcements this week, PennEast Pipeline LLC and UGI Energy Services (ticker: UGI) announced plans to build a 100 mile, $1 billion 30-inch gas pipeline from Pennsylvania and New Jersey to take Marcellus gas production to market. The PennEast pipeline is designed to take 1 Bcf of natural gas per day, which can supply gas to the equivalent of 4.7 million homes. UGI is operator of the pipeline and said that the project serves to meet growing demand in the mid-Atlantic marketplace.
PennEast is a joint project of AGL Resources (ticker: GAS), NJR Pipeline Company, a subsidiary of New Jersey Resources (ticker: NJR), South Jersey Industries (ticker: SJI), and UGI Energy Services, a subsidiary of UGI Corporation.
Separately, Columbia Pipeline Group, a unit of NiSource Inc. (NYSE: NI), announced a total of $1.75 billion in new investment in pipeline infrastructure that will enable it to transport up to 1.5 billion cubic feet per day (Bcf/d) of natural gas from Marcellus and Utica production areas.
Columbia’s Ohio and West Virginia pipeline, the Leach XPress project, is supported by long-term firm service agreements with Range Resources – Appalachia LLC (ticker: RRC), Noble Energy, Inc. (ticker: NBL), Kaiser Marketing Appalachian LLC, and American Energy Utica – LLC. The project, which involves construction of approximately 160 miles of pipeline, compression and related facilities on Columbia Transmission’s system, will provide access to multiple Marcellus and Utica receipt points and establish a substantial new header system serving the heart of the Appalachian supply basin.
Columbia Gulf’s Rayne XPress project primarily involves the addition of compression to Columbia Gulf’s existing pipeline facilities to provide transportation of over 1.0 Bcf/d for the project shippers. Columbia expects construction of both projects to start in the fourth quarter of 2016 and targets for them to be online in the second half of 2017, pending regulatory approvals.
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