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Superstorm Sandy Slams Northeast's Coastal LDCs

November 5, 2012
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Natural gas distribution facilities sustained the heaviest damage when Hurricane Sandy slammed into the East Coast last week, while exploration and production (E&P) operations in the Marcellus Shale and pipeline systems in the region incurred either minimal or no disruptions. The severe weather for the region may not be over yet. The National Weather Service (NWS) is predicting that a nor'easter could hit the mid-Atlantic and New England by Tuesday, Election Day.

The oncoming storm, as forecast by the NWS, it isn't expected to be as bad as Sandy, but it could include snow in interior New England and New York, beach erosion and high winds for areas that have suffered Sandy's wrath, as well as moderate or heavier rainfall.

New Jersey Natural Gas (NJNG) last Thursday shut off gas flow to a part of its system that served 28,000 customers on the barrier islands that were ravaged by Sandy. That represents 5% of the distribution company's customer base, said NJNG spokeswoman Renee Amellio. The cut-off of the gas service came on the first day of the winter heating season.

The gas distribution company took the action after responding to reports of more than 1,300 gas leaks, which were fueling a number of fires on the barrier islands south of Johnson Street in Bay Head to Seaside Park, which is in Ocean County, NJ. At 6 p.m. Thursday, NJNG said it completed the venting of is natural gas system in that part of the hurricane-damaged barrier islands.

New Jersey Gov. Chris Christie ordered that gas be turned off to customers in the affected Ocean County area, where several fires have burned. "The governor and New Jersey Natural Gas are on the same page," Amellio said. "Pressure in the pipes is now at zero pounds per square inch. NJNG will now begin to assess damage to the system and restoration requirements," the utility said.

Earlier last week, Amellio said NJNG had survived Sandy relatively unscathed, with no major power outages or damages. However, she said at the time that flooding had prevented crews from accessing some coastal areas of NJNG service territory. When the water receded and emergency personnel could get into the area it was a different story.

"Our crew did everything we could to save [that part of] the system," said NJNG COO Kathleen T. Ellis. "We were only able to gain access to some of the most damaged areas within the last 24 hours, and the devastation is nothing that could be seen from the air. It is beyond the imagination. The only safe thing to do is shut down the system."

NJNG said water infiltrates its pipelines when gas pressure is cut, which may damage the pipes and require the infrastructure to be rebuilt before service to the barrier islands can be restored. "At this time it is impossible" to estimate how long it will take to rebuild the damaged system, Amellio told NGI.

"It will take time to get life back to normal for our customers; but make no mistake, we will not rest until it is done," Ellis said. NJNG, a subsidiary of Wall, NJ-based New Jersey Resources, supplies natural gas to a more than 500,000 customers in the southern, central and northern parts of the state. NJNG said it has received assistance from a number of utilities, including Washington Gas Light, Columbia Gas, New England Gas and Delmarva Power and Light. Additional crews from PSE&G, South Jersey Gas and UGI Utilities also were on their way to help.

"Our pipe [system] seems to be OK. We made out a lot better than New Jersey Natural," said Joanne Brigandi, a spokeswoman for South Jersey Gas. The utility experienced an outage in one part of Atlantic City Thursday affecting 140 customers when water flowed into its system, she noted. But Brigandi said that by Friday the water had been removed, and it was trying to get into individual homes to relight pilot lights.

She noted that customers of South Jersey Gas were just being allowed to return to their homes to assess damages. South Jersey Gas serves 350,000 residential, commercial and industrial customers in the southern half of the state, including all of Atlantic, Cape May, Cumberland and Salem counties and portions of Camden, Burlington and Gloucester counties.

National Grid, the largest gas distributor in the region, reported that parts of its system also sustained heavy damages. In the Misquamicut Beach area of Westerly, RI, "the natural gas distribution system was heavily damaged by coast flooding," the utility said. National Grid is working with state and local officials to develop a plan to rebuild that part of its system. The company did not provide any further details.

National Grid reported Thursday that service to many of its customers in Newport, RI, had been restored, after it temporarily suspended service Tuesday as a precautionary measure while the system was evaluated to ensure it had not been compromised by the storm. "National Grid crews are out in force going door-to-door to restore service to the remaining customers. Technicians must enter each affected building to relight all gas appliances," the company said.

A fallen power line burned a hole in a Southern Connecticut Gas 12-inch distribution line, shutting down Interstate 95 in both directions Thursday. "We were able to secure the leak fairly quickly and repressurize the line," preventing an extended outage, said Michael West, spokesman for parent United Illuminating Co., which also operates Berkshire Gas and Connecticut Gas.

The American Gas Association (AGA), which represents gas utilities, said its members participate in a mutual assistance program for disasters. In preparation for Hurricane Sandy and its aftermath, more than 20 natural gas utilities have held daily calls to offer assistance and guidance to utilities and safety officials in the communities where gas service has been interrupted.

In New Jersey alone, it said there were more than 400 personnel on the ground, including crews from eight other gas utilities from surrounding areas. AGA said its staff has worked with the Northeast Gas Association to coordinate utility assistance to companies in need and has been in contact with the Department of Transportation's Pipeline and Hazardous Materials Safety Administration and other federal and local regulators.

Minimal damages were reported by major interstate gas pipelines in the region.

When asked about damage to Williams' systems, including Transcontinental Gas Pipe Line (Transco), which delivers into the heart of the affected area, Vice President Frank J. Ferazzi said the company lost "purchased power in many of our compressor stations in New York and New Jersey, and parts of Pennsylvania. But at those stations, we have back-up generation capability that's powered by natural gas. So there's no disruption to flows."

Williams also has a liquefied natural gas facility "that's located close to the water," Ferazzi told analysts during a conference call last week. "And so we anticipated that we may get some minor flooding, and that did, in fact, happen. So in anticipation of that, we took the facility down on Sunday [Oct. 28]. We did, in fact, get some water. But once the facility dried down, and we pumped a couple of feet of water away, we're not expecting any permanent damage there. No leaks on the system, no other disruptions in flow...So I think on balance, we fared remarkably well. We're going to have to remove some trees from the right of way, some fences were blown down. But again, no permanent damage to the facilities and no disruption in flow."

Spectra Energy's Texas Eastern Transmission (Tetco) and the Algonquin Gas Transmission pipelines, which run into coastal New York, New Jersey and New England, reported some damage, but "with no impact to our ability to meet customer needs. Our folks are out working on it," said Spectra spokeswoman Marylee Hanley. Damage was to numerous locations along the Spectra system, but she did not elaborate.

Hurricane damage to Spectra compressor stations and ongoing construction projects was "nothing significant," other than some flooded vehicles, according to CEO Greg Ebel. "We basically shut in or shut down operations early in the weekend...We saw no interruptions to any of our service." In preparation for the storm, Spectra also halted all construction on the Tetco expansion, which when completed would provide an additional 800 MMcf/d of transportation capacity into the New Jersey-New York region (see NGI, Oct. 22).

"Hurricane Sandy has certainly cost a few days of construction, but nothing substantial for a project of this size...where there was pipe that we were working, [we] backfilled the trenches, and we didn't see any impact there," said Ebel. Some construction will have to wait until electricity is back up in the area but the project remains on target to be in service in the fourth quarter of 2013. Sandy also didn't knock any other Spectra projects in the region off their schedules, he added.

Overall, the pipelines weathered the storm "well," said Don Santa, president of the Interstate Natural Gas Association of America (INGAA).

"INGAA member companies are monitoring developments and their systems actively, with a focus on potential flooding or wind damage to above-ground facilities in low-lying or particularly hard-hit areas," he noted. "Any potential [pipeline] outages are likely to be mitigated by relatively modest seasonal natural gas demand and lower electric generation demand due to power outages."

On the E&P front, Hurricane Sandy appears to have posed a minimal disruption to oil and gas companies operating in the Marcellus Shale.

Cabot Oil & Gas Corp. spokesman George Stark reported that the company had idled five drilling rigs last Monday, but they were back in operation on Tuesday afternoon. "We halted operations where we were drilling, [but] the storm did not materialize," Stark said. "The high winds were not there. So we were able to make the all clear assessment this afternoon around 3 p.m. and went back to full operations."

Stark said he knew some people were "concerned about flooding and [hydraulic fracturing waste] pits overflowing. But we operate a closed-loop system, so there is no opportunity for pits to flood or reserve pits or impoundments [to overflow] because we don't operate them. That's the benefit of a closed-loop system."

Matt Pitzarella, spokesman for Range Resources Inc., said the company did not need to idle any of its approximately six drilling rigs operating in the Marcellus. "We didn't have any damages, stoppages or issues associated with [Sandy]," he said. "That was really a combination of planning and preparation as well as Mother Nature. Certain aspects of what we were doing we postponed during the storm. For example, we had a frack crew running in southwest [Pennsylvania], but we rigged it down and sent the guys home.

"Right now our primary focus is being attentive to our customers: the end-users, the utilities and those companies that may have had service disrupted downstream," Pitzarella said. "We're looking to do whatever we can do to work with them."

On the power side, whose above-ground lines have been hit much harder, the Edison Electric Institute (EEI) said. Toward the end of the week utility crews from recently restored areas were being redeployed to regions that were still in the dark. EEI said more homes and businesses lost power as a result of Sandy than from any other storm in history. Approximately half of all affected customers had been restored as of early Friday, with 1.5 million brought back online.

"We are in the midst of a great American story," said EEI President Tom Kuhn. "This is a national response, and today we are still in action, flying crews in from the West Coast, Canada, and now companies that have restored power to their customers are lending a hand to their neighbors. We have utility companies sending crews, which make up the 65,000 line and transmission workers, tree resources, assessors, network personnel, and substation experts clearing the way for power."

It was clear, however, that many customers where the storm damage was greatest would be without electricity or natural gas for days or weeks.

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