Alliance Pipeline, Duke Energy Gas Transmission (DEGT) and NJR Pipeline Co. are teaming up to propose a new 125-170-mile bidirectional pipeline between the Chicago Hub and the Lebanon Hub in Ohio to provide Canadian producers better access to premium gas markets in the Northeast.

The project, which will be designed for service in November 2008, would put Canadian producers in a better position to compete for Northeastern markets with Rocky Mountain gas producers who will be bringing supply east on the proposed 1.8 Bcf/d, 1,323-mile Rockies Express system proposed by Kinder Morgan, Sempra and ConocoPhillips. Rockies Express is on schedule to have its proposed facilities in initial service to Clarington, OH, by December 2008, subject to the receipt of necessary regulatory approvals.

Alliance, Duke and NJR, an affiliate of Northeastern utility New Jersey Natural Gas, have signed a memorandum of understanding to construct the Lebanon Connector pipeline, which would extend from either Alliance Pipeline in Joliet, IL, or from an interconnect with Vector Pipeline at or near Springville, IN. From either of those points, the pipeline would connect to Texas Eastern’s existing Lebanon Lateral at Gas City, IN, where gas could then be transported to the Lebanon Hub. Gas also could be moved from the Lebanon Hub to regional storage fields utilizing the planned bidirectional capabilities of the Lebanon Connector.

“The Lebanon Connector will provide shippers with enhanced Midwest [to] Mid Atlantic connectivity, improving supply and market liquidity,” said Jim Goldmann, vice president, transportation services and development for Alliance Pipeline Inc.

Greg Rizzo, DEGT group vice president of Northeast transmission and storage, noted that the Lebanon Hub is rapidly emerging as an important hub for producers looking to move natural gas production to eastern markets. Lebanon is an intermediate point on the proposed Rockies Express pipeline.

“Existing infrastructure in the Lebanon area, as well as other projects currently proposed in the area, make the Lebanon Connector an economical way for shippers to reach higher value markets as well as to access regional storage,” said Joseph P. Shields, senior vice president, NJR Pipeline Co.

The companies plan to hold an open season starting July 28 and ending Aug. 31 to test market interest in the project. The results of the open season will help determine the pipeline size and route, the companies said. The system would follow the existing Texas Eastern Lebanon Lateral. DEGT recently announced plans to expand the Texas Eastern system from Lebanon to New Jersey by up to 150,000 Dth/d to meet firm contracts with PSEG Power LLC and New Jersey Natural Gas (see NGI, April 10, March 20).

For details contact Tony Straquadine at Alliance at or (952) 983-1005; Rob Hansen at DEGT at or (617) 560-1549 or Rick Gardner at NJR Pipeline at or (732) 938-1007.

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