Northeast Pennsylvania Marcellus Shale producers got some relief from sagging prices when El Paso Corp.’s Tennessee Gas Pipeline Co. placed its long-awaited 300 Line forward-haul expansion in service, increasing capacity on the Tennessee Gas Pipeline (TGP) system by 350 MMcf/d, a nearly 50% boost.

The 300 Line expansion provides access to supplies from Gulf Coast, Appalachian, Rockies and Marcellus Shale supply areas, and gas deliveries to points along the 300 Line path and into various interconnections with other pipelines in northern New Jersey, as well as an existing delivery point in White Plains, NY, El Paso said.

“The TGP system is a key conduit for Marcellus Shale gas and other diverse supplies into Northeast and New England markets,” said Norman G. Holmes, president of TGP and Southern Natural Gas Co. LLC. “TGP is investing about $1.3 billion in four new Northeast projects that will increase capacity on the TGP system by an additional 1.5 Bcf/d, primarily from the Marcellus Shale [see Shale Daily, Nov. 1]. The 300 Line Project is the first of these, and plans call for the others to be placed in service in 2012 and 2013, subject to receipt of regulatory approvals.”

The project included installation of eight looping segments in Pennsylvania and New Jersey, totaling 127 miles of 30-inch diameter pipeline, and the addition of about 55,000 hp of compression through the installation of two compressor stations and upgrades at seven existing stations. The cost was about $700 million. All of the project capacity is contracted under a long-term firm transportation agreement with EQT Energy LLC, El Paso said.

The Federal Energy Regulatory Commission approved start-up of the expansion last Friday.

Because of incremental forward and backhaul capacity, increasing delivery capacity to interconnects with Algonquin, Transco and Con Edison in White Plains, NY, Marcellus production is expected by Bentek to grow by about 575 MMcf/d by early 2012.

Bentek said it expects Northeast dry gas production to reach 12 Bcf/d by 2016. Analyst George Lippman of Lippman Consulting told NGI’s Shale Daily he expects production out of just Pennsylvania to reach about 6 Bcf/d by 2016, more than double the current 2.7 Bcf/d.

“Only 1 Bcf/d of additional capacity is planned to move more supply to New York City by 2013, keeping this market constrained and trading at a premium to other Northeast hubs,” Bentek said.

The 300 Line Expansion is the most noteworthy of Marcellus projects to come on line of late, it follows the recent start-up of the 450 MMcf/d Laser Northeast Gathering Co. project — 30 miles of 16-inch diameter pipeline in Susquehanna County, PA, and Broome County, NY. The Laser project went online last week, adding capacity from northeastern Pennsylvania. And National Fuel Gas Co. recently completed two related projects that added 150,000 Dth/d of capacity in Washington and Green counties, PA, to carry Marcellus gas to markets.