Dominion Resources Inc. said last week interest is growing in the company’s proposal to turn the Cove Point liquefied natural gas (LNG) import terminal in Lusby, MD, into an export terminal (see NGI, Oct. 17, 2011).

The news came when the company announced its fourth quarter and full-year earnings, which declined on lower profits in the merchant generation business and a decrease in weather-related energy sales.

“We are engaged in discussions with numerous potential customers in Europe and Asia, as well as producers in the Appalachian Basin,” CEO Tom Farrell told financial analysts during a conference call. Last October the company asked the U.S. Department of Energy (DOE) for approval to export up to 365 Bcfe/year for 25 years to nonfree trade agreement countries. “Our filing supports our belief that the project will have many positive economic benefits, and we are hopeful for DOE approval later this year.”

Farrell also said subsidiary Dominion Transmission Inc. (DTI) made “significant progress” on several capital projects in 2011, including the first phase of a natural gas processing and fractionation plant in Natrium, WV; construction of the Appalachian Gateway Pipeline; and expansions of the Ellisburg-to Craigs and Northeast pipelines, all of which he said would be in brought into service this year (see NGI, April 4, 2011). The Hastings Extraction/Fractionation Plant near Pine Grove, WV, had record fractionation volumes of more than 180 million gallons of natural gas liquids (NGL) in 2011 (see NGI, Dec. 21, 2009).

The first phase of the Natrium facility is expected to cost $500 million and be in service by December, processing 200 MMcf/d and fractionating 36,000 b/d of NGLs. Natrium’s second phase is expected to be in service by 4Q2013. The $634 million Appalachian Gateway pipeline — a 109-mile line designed to carry shale and conventional gas produced in West Virginia and southwestern Pennsylvania to markets in the Mid-Atlantic and Northeast — is scheduled for service by September.

DTI plans to expand its Ellisburg-to-Craigs pipeline by November to accommodate Tennessee Gas Pipeline, which signed a 10-year lease agreement for capacity on the line. Tennessee wants to move up to 150,000 Dth/d from its 300 Line in northern Pennsylvania to its 200 Line in upstate New York. DTI’s plan to expand its Northwest pipeline to 200,000 Dth/d is also expected to be completed by November. Like the Appalachian Gateway, it will also service markets in the Mid-Atlantic and Northeast.

Dominion reported earnings of $201 million for 4Q2011 (35 cents/share), a decline of nearly 33% from the $298 million (51 cents) in the same quarter a year ago. For the full-year Dominion earned $1.4 billion ($2.45/share), down from $2.8 billion ($4.76) in 2010.

©Copyright 2012Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.