NGI The Weekly Gas Market Report

Briefs -- Texas Gas Transmission, Xcel Energy, Atlantic Sunrise, Sabine Pass, Perseus-Greyrock Energy, Energy Transfer-Williams

Boardwalk Pipeline Partners LP subsidiary Texas Gas Transmission LLC (TGT) has asked the Federal Energy Regulatory Commission (FERC) for authorization to place its Southern Indiana Lateral Project into service by June 17. The project was designed to serve two industrial customers in southern Indiana -- Midwest Fertilizer Co. and SABIC Innovative Plastics Mt. Vernon. It includes about 30 miles of 10-inch diameter pipeline extending from TGT's Robards Junction facilities in Henderson County, KY, to an interconnect with SABIC in Posey County, IN, and associated facilities. The project would provide up to 166 MMcf/d of firm transportation capacity, according to to TGT's November 2014 application to FERC. TGT has executed precedent agreements with the customers for a primary term of 20 years. Estimated cost of the project was $79.7 million.

Xcel Energy combination utility Public Service Company of Colorado filed its electric resource plan with state regulators, calling for up to 600 MW of generation to be added by 2023; some of it may be natural gas-fired. The resource plan anticipates annual customer growth averaging 1.4%, resulting in an additional 126,000 customers by 2023, and a mix of generation resources to meet the added load.

The Pennsylvania Department of Environmental Protection has extended the public comment period on water obstruction and encroachment permits for Williams Partners' Atlantic Sunrise pipeline project. "A project of this size requires thoughtful public input," said DEP Acting Secretary Patrick McDonnell. The agency said it decided a regular 30-day comment period on the permits was not enough because of the public interest in the project, extending the period to 60 days and accepting comments until Aug. 1. Atlantic Sunrise would provide an additional 1.7 million Dth/d of year-round firm transportation capacity from the Marcellus Shale in Northeast Pennsylvania to existing Transcontinental Gas Pipe Line markets. The project would cross ten counties in eastern and central Pennsylvania before entering Maryland. The pipeline needs water obstruction, encroachment, sedimentation control and air quality permits from the state. Last month, the Federal Energy Regulatory Commission issued a favorable draft environmental impact statement for the project (see Daily GPIMay 6). Williams is targeting an in-service date for Atlantic Sunrise of late 2017.  

The first train of the Sabine Pass Liquefaction (SBL) project in Cameron Parish, LA, is being handed over to the company by contractor Bechtel, months ahead of schedule, Bechtel and SBL affiliate Cheniere Energy Partners LP said Tuesday. The "substantial completion" of Train 1 follows the sendout of numerous commissioning cargoes (see Daily GPIMay, 27May 4). Under a sale and purchase agreement with BG Gulf Coast LNG LLC, the date of first commercial delivery for Train 1 is expected to occur in November 2016, upon which the agreement's 20-year term commences. Under the agreement BG has certain rights to early cargoes produced from Train 1. "Now that Train 1 has achieved substantial completion, financial results from its LNG sales going forward will be reflected in the statement of operations," Cheniere said.

Independent Mexican exploration and production companyCompania Petrolera Perseus SA de CV (Perseus) plans to partner with small-scale gas-to-liquids technology developer Greyrock Energy Inc. to reduce natural gas flaring in Mexico. Perseus will use Greyrock’s “Flare-to-Fuels” system to convert its flared gas into clean transportation fuels. The partnership “provides an opportunity to simultaneously address an important environmental issue for Mexico and produce cleaner, high quality transportation fuels,” Perseus CEO Tomas Milmo Santos said.

Energy Transfer Equity LP (ETE) Thursday said it is pursuing a counterclaim in a lawsuit filed by The Williams Companies Inc. for the right to terminate the companies' merger agreement. A trial is scheduled for June 20 (see Daily GPIMay 25). ETE said Williams has breached the merger agreement by, among other things, refusing to cooperate with ETE in the financing of the deal and suing Kelcy Warren, the chairman of ETE's general partner, personally in Dallas County, TX, in violation of a mandatory forum selection provision in the merger agreement. ETE is seeking a declaratory judgment that Williams breached the merger agreement, including by its board of directors modifying or qualifying its approval and recommendation of the merger. ETE also seeks a judgment that entitles it to immediately terminate the merger agreement. "In the event ETE is entitled to and does terminate the merger agreement due to a modification or qualification of the Williams board of directors' recommendation of the merger, Williams would owe ETE a termination fee of $1.48 billion," ETE said.

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