Newcomer XcL Midstream LLC, founded this year, said it has a binding anchor shipper commitment from an affiliate of Tug Hill Inc. for its Appalachia Connector Pipeline.

The project includes a 1 Bcf/d dry natural gas header system and a 200 MMcf/d wet gas system along with a parallel water pipeline. Phase one is currently under construction with a planned in-service date of 2Q2018. Phase two construction is scheduled to begin early next year.

The header system would provide takeaway in West Virginia’s Marshall and Wetzel counties, and in eastern Ohio. Interconnections would be with Dominion Transmission, Columbia Gas Transmission LLC’s Leach and Mountaineer Xpress pipelines and Enbridge Inc.’s Texas Eastern pipeline. Phase two would also have multiple interconnections to tap markets via the Clarington Hub in Ohio.

The wet gas system, part of the initial phase, would deliver production to multiple processing plants, including Blue Racer Midstream LLC’s Natrium Processing and Fractionation facility in West Virginia.

Tug Hill affiliate THQ Appalachia I LLC (THQA) has dedicated its lease position in exchange for 600 MMcf/d on the Appalachian Connector and would also receive all the capacity on the project’s wet gas system.

“The timing of XcL’s Appalachian Connector Pipeline and the ability to optimize our gas production with every major southwest Appalachian index will provide significant value for THQA and its stakeholders,” said Tug Hill COO Evan Radler. “Additionally, having future optionality to enhance our connectivity across West Virginia and into Ohio will allow THQA to opportunistically develop its acreage and access the more than 14 Bcf/d of new gas takeaway” that’s expected to come online in the region.

THQA is a partnership between private equity firm Quantum Energy Partners and privately held Tug Hill that was formed in 2014. Tug Hill has core acreage in Marshall and Wetzel counties. It also has non-operated assets in Northeast Pennsylvania.

XcL formed in April to develop greenfield midstream assets in southwest Appalachia. It does not currently have assets in the region; the Appalachia Connector Pipeline would be its first.

“XcL is a new pipeline that will bridge the gap between an expanding interstate system and natural gas production assets in southwest Appalachia,” a company spokesperson said.

With offices in Canonsburg, PA, and Fort Worth, TX, XcL is also backed by Quantum. The company said it is in active discussions with other customers for similar firm transportation in northern West Virginia and eastern Ohio.