FERC Friday issued a favorable final environmental review of Texas Gas Transmission LLC's proposed Fayetteville and Greenville laterals, which would provide takeaway capacity for natural gas from the new Fayetteville Shale play area in North-Central Arkansas.

"The Fayetteville/Greenville Expansion Project with appropriate mitigating measures, as recommended, would have limited adverse environmental impact," staff of the Federal Energy Regulatory Commission (FERC) said in its final environmental impact statement (FEIS) on the project [CP07-417]. The Commission typically votes on a project certificate within weeks of issuing a FEIS.

The Fayetteville lateral will be a 167-mile, 36-inch diameter pipeline that can transport up to 1.1 Bcf/d. The proposed lateral would run through several counties in Arkansas and interconnect with Texas Gas pipeline in Coahoma County in Mississippi. The Greenville lateral will be a 98-mile pipeline with an initial design capacity of 750,000 MMBtu/d, extending from Texas Gas' mainline near Greenville, MS, east to Kosciusko, MS.

Texas Gas, a subsidiary of Boardwalk Pipeline Partners LP, said it expects to receive a FERC certificate by April. Most of the Fayetteville Lateral is targeted for operation in August of this year, with the rest of the Fayetteville Lateral and Greenville Lateral going into service in the first quarter of 2009.

Construction of the laterals is supported by a precedent agreement for firm transportation with Southwestern Energy Services Co., a wholly owned subsidiary of Southwestern Energy Co., a leading developer of the Fayetteville Shale.

The Fayetteville lateral will receive gas at multiple points in the Fayetteville Shale play in central Arkansas and will deliver the gas to new and existing markets served by Boardwalk's existing and planned pipelines, as well as to multiple interstate pipeline interconnects on the proposed Greenville lateral. The laterals would provide Fayetteville Shale producers with the ability to access markets on Texas Gas as well as markets (Midwest, Southeast and Northeast, along with Henry Hub) served by interconnecting pipelines.

Texas Gas is a 5,900-mile pipeline that provides storage and transports natural gas from the Gulf Coast, Louisiana and East Texas to markets in the South, Midwest and Northeast.

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