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Tenaska Partnering on Marcellus Gathering Line

Tenaska Midstream Services is participating in the development of a 16-mile natural gas gathering line to serve an area of West Virginia that has lacked adequate transportation infrastructure, the company said last Tuesday. Marcellus Shale production is targeted.

Tenaska Midstream is partnering with Superior Appalachian Pipeline LLC to build the system to carry gas from wells in Preston County, WV, to the Columbia Transmission System, which serves markets in Virginia, the District of Columbia and Maryland. The system has the potential to be expanded to connect with the Texas Eastern Transmission Corp. interstate pipeline. The line is expected to be completed during the fourth quarter, the Tenaska Inc. unit said.

Tenaska affiliates Tenaska Resources LLC and Tenaska Drilling Services LLC are active in the Marcellus Shale formation underlying West Virginia and Pennsylvania and have drilled seven wells to date in Preston County.

"The Marcellus Shale is proving to be a highly productive source of new gas supplies, but opportunities are constrained by the absence of modern transportation infrastructure," said Tom Boyd, Tenaska general manager of exploration, production and midstream. "This gathering line will be the first in Preston County to provide a 21st Century path to market for this important developing energy resource."

Superior of Tulsa, OK, will be responsible for operation of the system. "The line already has commitments to gather gas from producers who hold some of the larger acreage positions in the county. We are actively seeking additional gas supplies from other third parties," said Superior's Charles Davies, vice president of business development.

Independent producer Cabot Oil & Gas Corp. recently executed binding agreements with Williams Partners LP to anchor a new 20-inch diameter high-pressure gathering line (see NGI, March 1). Williams is to construct and operate the 28-mile gathering line, which would run from Cabot's Susquehanna County, PA, operating area south to Williams' Transcontinental Gas Pipe Line. The new line is expected to be in service by mid-summer 2011. Late last year Range Resources Corp. expanded its processing capacity in the region and added gathering and residue pipelines (see NGI, Dec. 21, 2009).

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