Spectra Energy’s long-under-attack New Jersey-New York Expansion on Monday received unanimous approval from FERC, which means firm natural gas transportation service into Manhattan could be operational sometime during the fourth quarter of 2013.

The 20-mile expansion of the company’s Texas Eastern Transmission and Algonquin Gas Transmission interstate pipeline systems will provide 800 MMcf/d of “critically needed” natural gas supplies to “high demand markets” in northern New Jersey and New York City, Spectra said Tuesday.

The $850 million proposed project will require the abandonment, replacement and construction of pipeline facilities in Middlesex County, Connecticut; Morris, Bergen, Union, and Hudson Counties, New Jersey; and Rockland, Richmond, and New York Counties, New York, and the lease of capacity on Algonquin’s pipeline system by Texas Eastern.

The embattled project has been fending off attacks from New Jersey and environmental officials. The expansion has been opposed by top officials in New Jersey — Gov. Chris Christie, Rep. William Pascrell (D-NJ) and Jersey City Mayor Jerramiah T. Healy (see Daily GPI, Jan. 24, 2011; Dec. 29, 2010) — but it has received solid support in New York (see Daily GPI, Sept. 1, 2011).

In March, the Federal Energy Regulatory Commission signed off on a favorable final environmental impact statement for the project.

“The Project’s FERC certificate is the culmination of a comprehensive, multi-year review by numerous federal, state and local agencies,” said Spectra CEO Greg Ebel. “This milestone is a crucial step toward completing this project, which will provide critically needed pipeline infrastructure and numerous environmental and economic benefits to the region.”

Ebel said that increasing the region’s access to diverse and reliable supplies will alleviate seasonal natural gas volatility, resulting in an estimated $700 million total annual energy savings in New Jersey and New York. In addition the project is expected to bring in millions in tax revenue and improve the region’s air quality by eliminating an estimated 6 million tons per year of carbon dioxide — the equivalent of taking more than 1 million cars off the road.

Speaking at Bentek Energy’s Benposium conference in Houston last week, Peter Carnavos, director of gas supply for Consolidated Edison Co. of New York, said he is projecting natural gas demand from utility conversions in New York City will grow 3.5% through 2017, requiring substantial new pipeline capacity to be up and running (see Daily GPI, May 17). He listed the New Jersey-New York Expansion as one of three projects now on the drawing board that are “very important” and have to happen “very soon” for the marketplace. The other two were Transcontinental Gas Pipeline Co.’s Northeast Supply Link, which would carry a total of 250,000 Dth/d, including 200,000 to Con Ed’s New York City territory, beginning in November 2013 (see Daily GPI, Feb 21); and Rockaway Delivery Lateral Project, with capacity of 647,000 Dth/d to the Rockaways and New York City with service as early as 2014 (see Daily GPI, Aug. 7, 2009).

FERC said intervenors have 30 days from the date of the order to request rehearing of the Commission’s action.

©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.