Chesapeake Utilities Corp. subsidiary, Eastern Shore Natural Gas Co. (ESNG), received approval on Wednesday from the Federal Energy Regulatory Commission (FERC) for an $8.5 million expansion of its natural gas pipeline in Pennsylvania and Delaware.

Stephen C. Thompson, ESNG’s president, called the approval “another step forward in a series of expansion plans to meet natural gas needs on the Delmarva Peninsula.”

The company said the project consists of constructing and operating mainline looping, upgrading a measuring and regulating station and constructing and operating a new pressure control station. The project is expected to add additional peak day capacity of 15,100 Dth to the pipeline’s existing peak day capacity of 110,183 Dth.

“The incremental capacity created by the proposed facilities will serve residential and commercial customer growth in Delaware, Maryland and Pennsylvania,” Thompson said. “The expansion program is a result of customer requests for additional firm transportation service capacity that ESNG received during its recent open season.” Thomas noted that since 1998, ESNG has invested $29.8 million in its system, increasing capacity by 93%.

Currently, the pipeline transports gas from southeastern Pennsylvania to points in Pennsylvania, Maryland and Delaware for various industrial facilities, electric generating plants and local distribution company customers.

“The open season was designed to partner with customers to develop a three-year growth plan to achieve expansion efficiencies, and to minimize environmental impact,” Thompson added.

Construction, which is expected to commence in the near future, will be phased in over the next three years. Phase I and II of construction will be based in Chester County, PA, and Phase III is in New Castle County, DE. “This three- year project will allow us to accommodate the growth on the Peninsula,” Thompson said. “As demand for natural gas continues to grow in Delaware and Maryland, ESNG is committed to expand the pipeline to meet that need.”

ESNG’s most recent expansion boosted pipeline capacity by slightly more than 4% in 2002, which provided an additional 4,500 Dth of new capacity. Prior to that, the company said it expanded its pipeline capacity by 23% in 2001, providing an additional 19,800 Dth of new capacity.

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