New Pressure To Up Water Infrastructure Spending; Broadband Funding Fleshed Out

April 2009 Vol. 64 No. 4

Martin Edwards, an INGAA spokesman, says the proposed tax hikes would have an indirect impact on transmission companies. “We are concerned about the impact on producers of domestic natural gas,” he states.

TGPC could be first to carry Marcellus Shale gas

Despite all the talk about the potential of Marcellus Shale gas improving East Coast supply, there have been no big deals between producers and interstate pipelines to move the gas. That may be changing. Tennessee Gas Pipeline Company (TGPC), a subsidiary of El Paso Corporation, expects to submit an application to FERC this summer for construction of its 300 Line Project whose initial purpose is to carry EQT’s Big Shandy Appalachian gas. But the 300 Line’s approximately 300,000 Dth/d capacity could be used to move either EQT’s Marcellus gas or someone else’s.

The 300 Line, which would run through Pennsylvania and New Jersey, is the largest new transmission project proposed for the Middle and Southern Atlantic Coast areas. FERC conducted public hearings as part of the pre filing process in February.

Currently, according to Bob Bookstaber, manager of business development for the 300 Line Project, Marcellus producers are using the pipeline capacity owned by electric utilities. “But this new pipeline sets us up to move Marcellus gas in the future,” Bookstaber says. TGPC just completed an open season to gauge the interest of Marcellus producers in signing contracts directly with Tennessee. “We’re in the very, very early stages,” explains Bookstaber, who acknowledges that some Marcellus producers have shown interest.

“We are currently evaluating our options on how to best deliver our Marcellus production to market,” states Wayne J. Desbrow, an EQT spokesman.

Tennessee Gas has been meeting with community groups and state agencies in New Jersey and Pennsylvania, and FERC held public meetings in conjunction with the project in February. The state environmental protection agencies have voiced satisfaction with TGPC’s flexibility, although some significant challenges remain.

New FERC Chairman Jon Wellinghoff has been an advocate for developing Marcellus Shale gas and moving it to the Mid Atlantic and South Atlantic regions. He made that point in his dissent on the FERC approval of the AES/Sparrows Point LNG project this past January. There he cited a study by Navigant Consulting which estimates the mean recoverable reserve amount at 31.2 Tcf, with maximum recoverable reserves of 262 Tcf and gas in place.