After pivoting to east-to-west flows to accommodate the mighty Marcellus and Utica shales, the Rockies Express Pipeline (REX) has been a major outlet for Appalachian Basin gas to reach Midwest delivery points.
REX began ramping up its westbound expansion between Clarington, OH, and Moultrie, IL, in August (see Shale Daily, July 30, 2015). The 1,700-mile, 1.8 Bcf/d pipeline has seen enough demand from upstream clients that it’s planning another expansion through its Zone 3 capacity enhancement project, which would increase total mainline westbound capacity to 2.6 Bcf/d.
Crystal Heter, VP of commercial operations with REX, said the next Zone 3 expansion is expecting its FERC certificate any day now and is on track for a 4Q2016 in-service date. In anticipation of this planned expansion and to have more flexibility in moving supply onto REX, upstream clients have built receipt points in Zone 3 that exceed the mainline capacity, Heter said.
Total Zone 3 receipt point capacity currently stands at 3 Bcf/d, well above REX’s 1.8 Bcf/d mainline capacity.
“It made logical sense to overbuild” receipt point capacity “initially, knowing this expansion was coming and some of that additional volume would come through those same locations,” Heter said.
To better reflect the changes occurring in REX’s receipts and deliveries, NGI is updating its daily REX Tracker with a new “E2W Pipeline Design Capacity Utilization” figure, designed to provide a clear breakdown of the percentage of the pipeline’s mainline east-to-west capacity being used. The tracker will still include the total receipt point capacity utilization percentage provided previously.
"We updated our REX Tracker to more accurately show how ‘full’ the east-to-west segment of REX Zone 3 is on a particular day," Patrick Rau, NGI director of strategy and research, said. "We had been showing operating capacity utilization, which is total Zone 3 receipt nominations divided by the total operating capacities of the individual Zone 3 receipt points. But our changes became necessary after REX hooked up its fifth major receipt point into Zone 3, the Ohio River System, in January.
“That added another 842 MMcf/d of individual receipt point operating capacity into Zone 3, bringing the total individual receipt point capacity to more than 3.0 Bcf/d. Yet nominations into Zone 3 have been running at about 1.8 Bcf/d, which is the effective design capacity from the east-to-west. 1.8 Bcf/d divided by that 3.0 Bcf/d yields an operating capacity utilization of about 60%, but that doesn't accurately reflect how full Zone 3 actually is, because all 3.0 Bcf/d of the total operating capacity from these now five receipt points cannot be nominated into Zone 3.”
For example, even though operating capacity utilization for Zone 3 receipt points totaled 59.4% for Friday (Feb. 19), the east-to-west design capacity utilization was 100%, calculated by dividing the total amount of gas nominated into REX Segment 390 (Chandlersville Compressor Station to Clarington, the segment into which Zone 3 receipts flow) divided by REX’s stated 1.8 Bcf/d east-to-west designed capacity.
When the Ohio River receipt point came online in January, REX “essentially started filling up” and has been operating at around 1.8 Bcf/d ever since, Heter said.
“We have a competitive situation out there, where there are parties that don’t own transport, or own transport in the opposite direction. They’re all trying to compete for that space and get service based on their priorities [and] according to our tariffs,” she said.
NGI will also be enhancing its REX Tracker with a detailed breakdown of the operating capacities of the individual Zone 3 receipt points and source information for the gas flowing through those points.
REX is operated by Rockies Express Pipeline LLC, which is owned by subsidiaries of Tallgrass Energy Partners LP (50%), Sempra Energy (25%) and Phillips 66 (25%).
The updated REX Tracker went live Friday. More information on the changes can be found by visiting the tracker at NGI’s website.