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Spectra Lays Groundwork for Northeast Incremental Market Project

FERC has approved a request from Spectra Energy unit Algonquin Gas Transmissions to begin a pre-filing review process for the company's proposed Algonquin Incremental Market (AIM) Project, a significant step forward for the long-awaited pipeline, which would deliver to the Northeast critically needed gas from Pennsylvania.

Algonquin plans to construct and operate approximately 26 miles of 36- to 42-inch diameter mainline, 18 miles of 12- to 16-inch diameter lateral pipeline, add 79,780 hp of compression at six existing compressor stations and appurtenant facilities in Connecticut, Massachusetts, Rhode Island and New York.

"The AIM project will create additional firm pipeline capacity necessary to deliver 433,000 Dth/d of natural gas to the Northeast market area," said the company's filing with the Federal Energy Regulatory Commission. "The project will create additional capacity between a receipt point at Ramapo in Rockland County, NY, and Algonquin city gate delivery points."

Algonquin anticipates filing its formal application with FERC by Feb. 2014, with a target in-service date of Nov. 1, 2016.

Spectra announced AIM in early 2012 (see Shale Daily, Jan 20, 2012). As originally planned, the pipeline would carry gas from the Texas Eastern Transmission and Maritimes & Northeast pipelines. Following an open season last September, Algonquin executed precedent agreements with Yankee Gas Services Co., NSTAR Gas Co., Connecticut Natural Gas and Southern Connecticut Gas, all of which have entered into commitments for firm transportation service, according to the filing.

Earlier this year, Spectra's Bill Yardley, president of the U.S. transmission and storage business, described AIM as a supply push and demand pull project (see Shale Daily, Jan. 17). "The oil-to-gas conversion growth at local distribution companies in Connecticut, Rhode island, and Massachusetts, along with increasing gas-fired power generation, fuel the demand for this project," he said.

Production in the Marcellus Shale over the past few years "has been nothing short of epic," and it is straining infrastructure to the point that the Appalachian region is in need of larger interstate connections, according to one natural gas analyst (see related story).

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