Two New Proposed Pipelines Designed to Move Marcellus Gas Outside of Mid-Atlantic by 2015

The growth in shale gas has fundamentally transformed the gas and power industries over the past three years and made gas the fuel of choice for new power generation. The Marcellus shale in PA & WV has seen explosive growth from 0.2 Bcf/day in 2009 to close to 5 Bcf/d currently.

While supply growth has exceeded expectations, it will at some point outpace the daily demand of the northeast markets. Efforts are currently underway to assess the pipeline demand for projects that would move Marcellus gas both north and south, further transforming the North American landscape for gas supply from traditional basins in the Gulf of Mexico and Canada.

Various companies have proposed a number of pipeline projects that will link this new resource of natural gas to markets both inside and outside of the northeastern region. Williams Co. has proposed building the Constitution Pipeline to move approximately 0.5 Bcf/d of supply from northeast PA in Susquehanna County to Schoharie County south of Albany, NY. The project will intercept the Iroquois Pipeline that runs south from Canada to NYC, and the Tennessee Gas Pipeline, running west to east, from NY into New England. The project would be completed by end of 2015.

Spectra Energy has also proposed a pipeline that will move approximately 1.25 Bcf/d of gas from the southwestern Marcellus, as well as future Utica Shale, south into Tennessee on the existing Texas Eastern Pipeline (TETCO). This project, named the Renaissance Pipeline, would collect gas to transport down into GA where it will be able to serve existing gas-fired generation as well as new generation being built over the next several years. The project would cost $1 billion dollars and have a completion date of late 2015. This gas would compete with traditional supplies of gas coming from the TX/LA producing region.