TGPC Could Be First To Carry Marcellus Shale Gas; 2010 Budget News
Despite all the talk about Marcellus Shale gas’s potential for improving East Coast natural gas 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 Corp., 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 dekatherms per day 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.
The map on El Paso’s website showing the route of the project has a bright red oval in Pennsylvania adjacent to the route indicating “1 Bcf/d of Marcellus connections.”
Bob Bookstaber, manager of business development for the 300 Line Project, says Marcellus producers are using pipeline capacity owned by electric utilities. “But this new pipeline sets us up to move Marcellus gas in the future,” he says. TGPC just completed an open season to gauge interest of Marcellus producers in signing contracts directly with Tennessee. “We’re in the very, very early stages,” explains Bookstaber, noting some Marcellus producers have shown interest.
“We are evaluating our options on how to best deliver our Marcellus production to market,” states Wayne J. Desbrow, an EQT spokesman.
Tennessee Gas has met 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 is 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 in January. Then, he cited a study by Navigant Consulting estimating the mean recoverable reserve amount at 31.2 Tcf, with maximum recoverable reserves of 262 Tcf and gas-in-place.
“The effective delivery of Marcellus Shale gas could be accomplished with expansion of pipeline and storage infrastructure in the region,” Wellinghoff wrote, describing that as a better alternative to building an LNG facility near Baltimore, which FERC approved by a vote of 4-1.
Marcellus Shale gas production is already under way at low levels. Range Resources Corp. and MarkWest Energy Partners, L.P. announced in October completion of the first phase of their Marcellus Shale infrastructure, including Pennsylvania's first large-scale gas-processing facility. Range has been completing production facilities and connecting previously drilled wells to the gas-gathering system. Net sales from the gas-processing plant exceed 30 Mmcf/d.
Obama’s Proposed 2010 Budget
- Coatings, pipe joint
- Compressor components
- Contractor, pipeline
- Contractor, river crossing/ directional drilling
- Directional drilling rigs, large
- Fittings, valves: plastic
- Meters, flow
- Pigs, cleaning
- Pigs, intelligent
- Pigs, scraper/ sphere launchers/ traps
- Scada systems
- Ultrasonic inspection
- Vacuum excavators/ potholing
- Valves, ball
- Welding systems, automatic