The final phase of a proposed project that would expand natural gas pipeline capacity in the constrained New England region can move forward after receiving a favorable environmental assessment (EA) from federal regulators.
In an order issued Tuesday by FERC, regulators determined that approving Portland XPress, proposed by Portland Natural Gas Transmission System (PNGTS), “would not constitute a major federal action significantly affecting the quality of the human environment,” with appropriate mitigating measures.
As designed, the project would provide 24,375 Mcf/d to PNGTS-owned facilities and 22,339 Mcf/d to PNGTS and Maritimes and Northeast Pipeline LLC jointly owned facilities. The Federal Energy Regulatory Commission also approved PNGTS’ request to abandon 7,185 Mcf/d of existing capacity of interim capacity from Maritimes & Northeast Pipeline (M&NE).
Work on Portland XPress would include installing a electrical control building with motor control center, emergency generator building, as well as generator and ancillary equipment at the Westbrook compressor station (CS) in Cumberland County, ME.
The project would also expand the existing building at the Eliot CS in York County, ME, to include a 6,300 hp gas-fired compression unit and ancillary equipment, and would include installing an auxiliary building housing a replacement emergency generator and boiler.
At the Dracut Meter and Regulator Station in Middlesex County, MA, PNGTS would install a low flow meter and transmitters and replace ultrasonic meter assemblies; and an 86 hp emergency generator and ancillary equipment.
FERC is accepting comments on the EA through Dec. 27.
Portland XPress is to be implemented in three phases over three years. On Nov. 1, the pipeline operator began service on the first phase, which added 39,841 Mcf/d of capacity on its north system from Pittsburg, NH, to Westbrook, ME. It also added 1,641 Mcf/d on the jointly owned system with M&NE from Westbrook to Dracut, MA, and raised its import and export capacity across the border with Canada to 274,216 Mcf/d from 210,000 Mcf/d.
Phase II would add 11,321 Mcf/d of capacity to the joint facilities through operationally available capacity and the lease agreement between PNGTS and M&NE. PNGTS filed its application with FERC for Phase III in June. Construction is expected to begin in April 2020, with in-service expected later that year.
PNGTS held an open season in 2017 to solicit interest in the project, resulting in eight precedent agreements for a total of 136,830 Mcf/d of firm transportation service. The project is a small step in increasing pipeline capacity in New England, where regulatory hurdles and other complications have stalled various attempts to build new pipeline capacity into the region despite extreme price volatility during times of strong demand.
This month, spot gas prices at Algonquin Citygate have averaged $5.96/MMBtu, a nearly $2 premium over the benchmark Henry Hub. Prices surged as high as $13.32 on Nov. 20 after starting off the month below $3. NGI’s Forward Look showed December forward prices sitting Tuesday at $10.07, compared with a $4.26 Nymex December futures settle.