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REX Starts Up Capacity Enhancement, Adds 200 MMcf/d East-to-West

Westbound volumes on the Rockies Express Pipeline LLC (REX) increased about 200 MMcf/d Tuesday, according to NGI’s REX Zone 3 Tracker.

The increase is the first sign off additional capacity from the 800 MMcf/d capacity enhancement project for east-to-west flows through REX’s Zone 3 out of eastern Ohio.

“REX flow data today show an increase in Section 390 operating capacity from 1.8 Bcf/d to 2.0 Bcf/d,” NGI Markets Analyst Nate Harrison said. “Section 390 remains almost completely utilized (99% utilization) as flows immediately ramped up to fill the extra capacity.”

East-to-west flows on REX had been maxed at around 1.8 Bcf/d. The capacity enhancement will eventually bring total westbound volumes out of East Ohio to 2.6 Bcf/d. Harrison said Tuesday’s incremental increase puts backer Tallgrass Energy Partners LP on schedule to meet its stated goal of having the capacity enhancement project fully operational by the end of the year.

In a note published early Tuesday, natural gas analytics firm Genscape said it tracked a 141 MMcf/d day/day jump in timely nominations on REX “though this number may change in later cycles. Overall, the uptick of 141 MMcf/d is well within the expected ramp up for the project.

“The largest growth comes from the EQT OVC point, which jumped 78 MMcf/d to 440 MMcf, followed by Rice Gunslinger, which added 30.5 MMcf/d,” Genscape said. “The Regency Ohio River System, responsible for REX filling to full earlier this year, also moved upwards, delivering” an additional 26 MMcf/d.

REX received the OK from FERC late last month to begin placing the Zone 3 capacity enhancement into service. Management for Tallgrass said during a 3Q2016 conference call that the 800 MMcf/d expansion is fully subscribed. Management had previously pointed to a growing interest from end users looking to tap into REX. The eventual available space on the expansion could provide “some pleasant upside surprises” relative to the designed capacity, according to CEO David Dehaemers.

Tallgrass and its affiliated entity own a combined 75% stake in REX, with Phillips 66 owning the remaining 25%.

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