The 1 Bcf/d Canaport LNG terminal has marked its official opening, giving Spain's Repsol YPF greater access to U.S. and Canadian natural gas markets. The liquefied natural gas (LNG) terminal received its first cargo in June (see NGI, June 22). It can supply up to 20% of New York and New England's gas demand, according to Repsol. The terminal facility has the capability to store 9.9 Bcf of gas in liquefied form. Canaport LNG is the first to be completed of 10 key projects included in Repsol's 2008-2012 strategic plan. It is the first land-based LNG receiving and regasification terminal built on the East Coast of North America in 30 years and the first LNG receiving and regasification terminal in Canada. Repsol partnered with Fort Reliance, Irving Oil's parent company and owner of Canada's largest oil refinery, in the construction of the terminal. Repsol is the managing general partner with a 75% stake and has contracted for 100% of the plant's capacity. Repsol began selling gas in the Northeastern United States in 2008. The company said it plans to quadruple its global volumes of LNG sold by 2012.
The New York State Public Service Commission approved more than $12 million in funding for three natural gas energy efficiency programs for large industrial customers. The programs are expected to save about 268,000 Dth through 2011. The programs include those administered by National Grid for its upstate and downstate service territories. Additional commercial and industrial efficiency programs are planned for other parts of the state. An approved National Grid $1.6 million program is designed to provide large industrial customers (customers with a gas demand greater than 10,000 Dth/year) with financial incentives and technical assistance to assess outdated/inefficient energy-using systems and recommend opportunities for replacement equipment and systems. Meanwhile, National Grid programs valued at approximately $10.5 million were approved for its KeySpan affiliates serving New York City and Long Island. These programs are designed for industrial customers with gas usage greater than 12,000 Dth/year and will provide technical assistance and financial incentives to help customers analyze their operations. The approved funding allocations are being guided by the commission's order that established targets and standards for natural gas efficiency programs. That order adopted a gas usage reduction target of 4.34 Bcf/year through the end of 2011. It's estimated that $130 million will be required annually to meet the target.
The economy's recovery won't be quick, but the beginning could be close at hand, according to two Midwestern gas and power utility executives. Michigan-based CMS Energy Corp. CEO David W. Joos told a New York conference he is starting to see "some reabsorption of the workforce" in his state, which is among the nation's hardest hit by unemployment. Some of those workers are finding jobs thanks to Michigan's efforts to become a home to the clean energy sector, Joos said. "There's not enough data out there, but all the anecdotal things we're seeing, all the things we talk to our customers about...it looks like the economy is starting to recover," he said. "We expect it to be a slow ramp, though, and not some sort of spike." NiSource Inc. CEO Robert C. Skaggs Jr. shared a panel with Joos at the Bank of America Merrill Lynch 2009 Power & Gas Leaders Conference. He said his company's utility operations -- power in Indiana and gas in Kentucky, Maryland, Pennsylvania, Ohio and Virginia -- generally enjoy a diverse industrial customer base and have "not been hammered by reductions" in the automotive sector. "Our base is diverse; it's not dependent on one industry in particular," he said. However, utilization among large steel producers that the company's utilities serve has been down 40-50%. But Skaggs said NiSource expects steel production will increase over the balance of the year.
EQT Midstream is retesting interest in a multi-year expansion of its Equitrans interstate pipeline and gathering systems in the Marcellus Shale fairway of West Virginia and Pennsylvania, which could provide up to 1.2 Bcf/d of capacity to Northeast gas markets. The EQT Corp. subsidiary last year held an open season to first test interest in an expansion of its Appalachian pipe systems that extended from West Virginia to Pennsylvania (see NGI, Sept. 8, 2008). The newly launched open season would test interest in expanding capacity through new pipeline looping, high-pressure laterals and compression facilities. Equitrans has the ability to add 900,000 Dth/d, EQT said. With enough support, capacity would be added to the Equitrans system over a three-year period with an independent project planned for each year. Each project would be supported by market commitments, and federal regulatory approval would be pursued as commitments are obtained. The open season will extend until noon EDT Oct. 14. For information contact Marc Weaver at (412) 395-3515 or email@example.com; or Andy Murphy at (412) 395-3358 or firstname.lastname@example.org.
Gas producers and other companies have formed Metroplex Natural Gas Vehicle Consortium to with a goal of developing transportation markets and a fueling infrastructure in North Texas for natural gas vehicles (NGV). To date, Enterprise Rent-A-Car, Republic Services Inc., Chesapeake Energy Corp., XTO Energy Inc., Clean Energy Fuels Corp., EOG Resources Inc., EnCana Corp., Quicksilver Resources Inc. and North Central Texas Council of Governments have signed on. The idea for the consortium came from an NGV symposium in June, which was co-hosted by the Barnett Shale Energy Education Council and Texas Christian University's TCU Energy Institute. An obstacle to expanding the use of NGVs is the lack of a natural gas fueling infrastructure in the North Texas region. Consortium members are exploring three options to solve the problem. The first is to take advantage of existing pipeline compressor sites by setting up pull through refueling station nearby. The second option is to locate new fueling stations in clusters near existing pipelines. Thirdly, with more planning and financial initiative, the consortium envisions refueling corridors along the major arteries between Fort Worth and Dallas, ultimately connecting to Oklahoma City, Waco, TX, Houston and other major metropolitan areas.
Petrohawk Energy Corp. is selling its Permian Basin properties to a privately owned company for $376 million in cash. At the end of 2008 the Permian Basin assets, including its interests in the Waddell Ranch, Sawyer, Jalmat and TXL fields of West Texas and southeastern New Mexico, had estimated proved reserves of 177 Bcfe. The properties currently produce 30 MMcfe/d. Proceeds from the sale are to finance Petrohawk's drilling in the Haynesville and Eagle Ford shales. The sale is expected to close by Oct. 30; the effective date of the transaction is July 1, 2009. Bank of America Merrill Lynch acted as marketing and financial adviser.
A Florida Public Service Commission (PSC) staff report on a Florida Power & Light Co. (FPL) proposal to construct a 280-mile intrastate pipeline to move natural gas north to Bradford County from Palm Beach County includes both a primary recommendation to approve the application and an alternative recommendation to deny it. FPL filed its proposal for the $1.5 billion Florida EnergySecure Line in April (see NGI, April 13). The 30-inch diameter pipeline's initial capacity would be 600 MMcf/d. About two-thirds of that capacity would be used by the FPL Next Generation Clean Energy Centers at Cape Canaveral and Riviera Beach, where the existing facilities are being retrofitted from fuel oil to natural gas facilities to reduce emissions. The remaining capacity would allow for a reserve margin to deliver fuel to FPL or others in the state, the utility said. In its application FPL projected that the pipeline's capacity would be expanded to 1.25 Bcf/d by 2030. Commission staff issued opposing recommendations on seven issues, including the question of whether the pipeline is needed to improve or maintain gas delivery reliability and integrity within the state. Florida Gas Transmission (FGT), which has filed to intervene in the case, said in a filing that existing pipelines in the state provide sufficient capacity to meet projected demand for approximately eight to 10 years. Assuming regulatory approval, FPL has said the pipeline could be in service as early as 2014.
Florida Public Utilities Co. (FPU) sent a letter to shareholders urging their approval of a proposed $595 million merger with Chesapeake Utilities Corp. and saying Energy Inc. (formerly Energy West Inc.), an opponent of the merger, has "mischaracterize[d] important facts" of the deal. The deal was announced in April (see NGI, April 27). After the close of the merger, FPU would be a wholly owned subsidiary of Chesapeake. The combined company would have approximately 117,000 natural gas customers, 31,000 electric customers and 48,000 propane customers in Delaware, Maryland and Florida. The deal cleared all state regulatory hurdles in July (see NGI, July 27).
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