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Regency, American Energy-Midstream to Partner in Utica NatGas Project

Regency Energy Partners LP (RGP) and American Energy-Midstream LLC (AE-MidCo) have partnered on RGP's proposed Utica Ohio River Project, which they have upgraded to deliver up to 2.1 Bcf/d of Utica Shale natural gas production initially to Rockies Express Pipeline (REX) and Texas Eastern Transmission.

RGP also secured a gathering agreement with explorer American Energy-Utica LLC (AEU) for the natural gas it produces in eastern Ohio.

"We are excited about the strong growth potential of the Utica Shale, and this project will be a main takeaway option for Utica development, providing interconnectivity with major interstate pipelines in 2015," said RGP's Art Cantrell, senior vice president, eastern region. AEU "has committed significant volumes to this project,” he said.

The joint venture (JV) of RGP and AE-MidCo is to include all previously signed volume commitments and large acreage dedications. As a result, the project would be upsized to accommodate more than 2 Bcf/d of firm volume commitments. The commitments represent most of the projected volumes in the pipeline's footprint.

Included is a 52-mile, 36-inch diameter gathering trunkline capable of delivering gas on the southern end of the line to REX and Texas Eastern. The project also would include 25 hp of compression built at the REX interconnect.

The entire project is expected to be completed by the end of June 2015. Total project costs are expected to be approximately $500 million, with RGP contributing 75%, and AE-MidCo contributing 25%. RGP is to construct and operate the project on behalf of the JV. RGP also noted that potential exists to connect the line to the interstate grid on the northern end of the trunkline, which could increase overall system deliverability to 3.5 Bcf/d.

RGP last October purchased PVR Partners LP, which among other things, gave it a big presence in the Appalachian Basin (see Shale Daily, Oct. 11, 2013). Energy Transfer Partners LP, which controls RGP, in June said it had secured commitments from Appalachian operators for a 2.2 Bcf/d pipe, ET Rover, to carry Appalachian gas to multiple markets (see Shale Daily, June 26). An open season for the proposed endeavor ended in July. AEU also has committed capacity in ET Rover.

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