East Tennessee Natural Gas has started laying pipe for its 510,000 Dth/d Patriot Extension into North Carolina. The $298 million extension-expansion project will boost East Tennessee’s existing design capacity of 700,000 Dth/d to more than 1.2 Bcf/d. Service is expected to begin in August or September with capacity increases due in November 2003 and in January 2005.

Patriot includes an expansion of East Tennessee’s existing mainline system in Tennessee and southwestern Virginia and an extension running from central Virginia to an interconnection with Transcontinental Gas Pipe Line’s mainline in Rockingham County, NC. The 93-mile extension will be 24-inch diameter pipeline, while the expansion of the exiting system consists of 85 miles of looping.

In connection with the project, a new salt cavern storage facility with expected capacity of up to 10 Bcf is being developed near an existing salt cavern in Saltville, VA, by East Tennessee’s parent company, Duke Energy Gas Transmission, and NUI Corp. subsidiary Virginia Natural Gas.

The Patriot project had to cross significant environmental hurdles to gain a FERC certificate. One of the more sensitive portions of the project includes a horizontal directional drill under the New River in Wythe County, VA. The 1,600-foot directional drill will be located 35 feet below the New River and is expected to take about six weeks to complete.

In approving the Patriot project last fall, FERC noted that gas demand in the South Atlantic region was projected to increase 50% by 2010, which it estimated would require a 1 Tcf boost in annual Southeast pipeline capacity. However, the market changed a lot over the last year.

Patriot was downsized and broken up into three construction phases to accommodate power project delays and cancellations. The changed power market situation affected another Mid-Atlantic pipeline project, Greenbrier Pipeline, which is facing new FERC scrutiny because some of its customers have backed away from proposed power plant construction.

FERC is requesting that Greenbrier, which is being sponsored by Dominion and Piedmont Natural Gas, provide an update on its customer agreements because at least one of its customers has dropped out: Dominion’s own 1,100 MW power generation plant in Roxboro County, NC, has been canceled eliminating the need for 180,000 Dth/d (see Daily GPI, April 3, Feb. 24).

The Patriot project has undergone significant changes. Last year, the Tennessee Valley Authority decided to scrap plans to build a 510 MW power generation facility and another customer, Cogentrix’s Henry County Power LLC, delayed construction of its proposed 1,080 MW generation facility in Virginia until January 2005 from January 2004, deferring the need for 200,000 Dth/d.

However, Patriot also will serve local utility load through contracts with Carolina Power & Light, Public Service Company of North Carolina and United Cities Gas Co. East Tennessee said 87% of the project’s proposed capacity is still subscribed under long-term agreements.

Despite the deferred and canceled power projects, gas demand in the region is still growing. This winter provided significant evidence of that, said DEGT President Tom O’Connor. “This year, during a winter that was only slightly colder than normal in areas served by the East Tennessee system, the ETNG pipeline experienced 15 of its top 40 peak delivery days in the history of the system,” said O’Connor, emphasizing the need for new energy infrastructure. “We believe it is critical that new pipeline capacity is available for our customers as quickly as possible.”

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