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NE HubLine East-to-West Project Environmentally OK

November 10, 2008
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FERC Friday issued a favorable environmental review of Algonquin Gas Transmission LLC's proposed HubLine/East-to-West (HubLine/E2W) expansion, which would significantly increase east-to-west expansion capacity on the pipeline system in New England, effectively creating a Northeast Hub that will tap liquefied natural gas (LNG) from offshore deepwater ports.

In a draft environmental impact statement, staff of the Federal Energy Regulatory Commission (FERC) concluded that the project would be "environmentally acceptable" because: 80% of the proposed pipelines would be within or adjacent to existing rights-of-way; natural and cultural resources and residential areas would be protected during construction and operation; Algonquin would implement a compensatory wetland mitigation plan; and the pipeline had already completed its Endangered Species Act consultations with a number of federal agencies [CP08-420].

The HubLine/E2W project, together with existing capacity, would allow Algonquin customers to transport approximately 1 Bcf/d of gas from east to west on the pipeline system by 2009, the Spectra Energy pipeline subsidiary said. The proposed facilities respond to "significant shipper interest in accessing new sources of supply on the eastern end of Algonquin's system that, in turn, has been driven by growing demand in the Northeast market," Algonquin told FERC in its application.

The HubLine/E2W facilities are proposed as an enhancement of Algonquin's original HubLine project (HubLine 2003), which was completed in November 2003 and which connected the east end of the Algonquin system with the terminus of Maritimes & Northeast Pipeline.

The combined projects "will facilitate the development, for the first time, of a Northeast market center with an active and highly competitive commodity market," Algonquin said. "Shippers, including existing customers, will be able to move [gas] to markets...from new supply sources on the east end of Algonquin from the Northeast Gateway Deepwater Port and the Suez (Neptune) Deepwater Port and other interconnecting systems such as Maritimes, Tennessee and Distrigas of Massachusetts on a reliable, forward-haul basis."

The two deepwater LNG ports -- Northeast Gateway and Neptune -- have partnered with Algonquin to build lateral facilities extending from the offshore ports to the pipeline's HubLine system in the Northeast.

Excelerate Energy, developer of the Northeast Gateway LNG port, has signed a precedent agreement for 500,000 Dth/d for a term of 10 years; Suez LNG NA LLC, developer of the Neptune LNG port, has inked a precedent agreement for 225,000 Dth/d under a term of 10 years; Narragansett Electric Co. (10,000 Dth/d for 10 years), Yankee Gas Services Co. (10,000 Dth/d for 10 years) and City of Norwich, CT (1,500 Dth/d for 10 years).

Algonquin has asked FERC to issue it a certificate for HubLine/E2W on or before Feb. 1, 2009 to "minimize disruption to peak summer load days [on Algonquin's system] and to ensure that construction can be completed prior to the 2009 winter season." Algonquin said it expects to have the expansion in operation by Nov. 1, 2009.

The project calls for the construction of approximately 31.4 miles of various diameter pipeline, including 12.9 miles of new pipeline in Massachusetts, 7.5 miles of replacement pipeline in Massachusetts, 11 miles of replacement pipe in Connecticut and associated facilities, as well as a new 10,310 hp compressor station in Massachusetts and upgrades to three existing compressor stations in Rhode Island, Connecticut and New Jersey.

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