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FERC Approves Two Marcellus Pipeline Expansions

FERC on Friday issued certificates for two Dominion Transmission Inc. (DTI) Marcellus Shale-related projects in Pennsylvania and New York: the Tioga Area Expansion Project and the Sabinsville-to-Morrisville Project.

DTI's Tioga Area Expansion Project calls for the construction of a 15-mile, 24-inch diameter pipeline and associated facilities on its existing transportation system in Tioga, Greene, Potter and Clinton counties in Pennsylvania and Steuben County, NY [CP12-19].

The Tioga Expansion Project will enable DTI to deliver 270,000 Dth/d of additional firm natural gas transportation service from the primary receipt points in Tioga and Potter counties to DTI's existing interconnect with Transcontinental Gas Pipe Line at Leidy in Clinton County (150,000 Dth/d), and a new interconnect with Texas Eastern Transmission at DTI's existing Crayne Station in Greene County (120,000 Dth/d). The estimated cost of the project, which will provide increased takeaway capacity for Marcellus producers, is $67 million, according to Dominion.

DTI said it executed binding precedent agreements with Shell Energy North America in February 2011 for 250,000 Dth/d for 15 years and with Penn Virginia Oil & Gas Co. for 20,000 Dth/d of firm transportation capacity for 15 years.

DTI's proposed Sabinsville-to-Morrisville Project (3.56 miles of 24-inch diameter pipeline) would allow Tennessee Gas Pipeline to move 92,000 Dth/d of firm primary receipt point rights from its existing receipt point near North Sheldon, NY, to the interconnection between DTI and Tennessee at Tennessee's Sabinsville M&R Station in Pennsylvania [CP12-20]. The project would cost an estimated $17 million, DTI estimated.

Both projects are scheduled for construction this year, with November in-service dates. The Federal Energy Regulatory Commission (FERC) issued favorable environmental assessments for both projects in December (see Shale Daily, Dec. 5, 2012).

The Commission granted DTI's request for a predetermination of rolled-in rate treatment of the projects' costs in its next Section 4 rate caste. FERC also approved DTI's proposal to recover the costs of the Sabinsville-to-Morrisville Project by means of an incremental monthly firm reservation surcharge.

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