With Marcellus Shale production growing exponentially, midstream players are handling that additional supply in different ways, company officials told a Pittsburgh-area audience recently.

“If you have some existing assets, you can really very strategically and efficiently expand those to keep up with what your customers need,” Marc Weaver, vice president for business development at EQT Midstream, said at the Marcellus NGL & Shale Gas Infrastructure Summit in Canonsburg, PA., on Aug. 25.

The EQT-owned Equitrans transmission system includes 700 miles of pipeline in West Virginia and southwestern Pennsylvania. Since 2009 EQT has added 210 MMcf/d of capacity to the 600 MMcf/d system and plans to add more than 600 MMcf/d in 2012 and up to 500 MMcf/d in 2013 to meet demand. EQT will do that by increasing operating pressures, adding interconnects to the Spectra Energy Corp. Texas Eastern Transmission Co. pipeline, expanding compression stations and connecting to processing plants (NGI, Aug. 1; May 16).

There are still challenges in the region, though, Weaver said.

The fragmented leaseholds in the region can lead to multiparty projects or duplication of facilities, he said, but a midstream player can capitalize by spreading its credit risk across more companies and creating economics of scale through larger projects.

While Equitrans is trying to manage an increase in Appalachian Basin supplies, Millennium Pipeline Co. LLC. is figuring out how to handle new supply sources, according to Stan Brownell, vice president of marketing.

“Our system has changed dramatically from its inception to where we stand today,” he said, noting that increased throughput on the Tennessee Gas Pipeline system between 2009 and 2010 increased the supplies moving through the Stagecoach pipeline leading into the Millennium system and “basically displaced all the gas that was coming from Canada.”

Millennium is working on four projects to add more than 1.2 Bcf/d of capacity to the company portfolio by the end of 2012.

That includes the Laser Midstream Pipeline to carry Marcellus gas from Susquehanna County, PA, to Millennium in New York — a project set to come online this month — as well as extension and expansion projects slated for this year and next year (NGI, Feb. 21).

To manage additional supplies, Millennium is also changing its engineering and operations, not just its capacity, Brownell said.

That includes a “tridirectional” flow from its Cornell compression station, or the ability to move gas into Canada, west to the Rochester, NY, area or east to the traditional demand centers around New York City, he said.

Increased Appalachian supplies will drive major infrastructure projects east of the Marcellus region to allow midstream players to switch from their current supply sources farther west, according to Scott Rupff, vice president of marketing for Iroquois Pipeline Operating Co. “All of us are having to learn to deal with changing flow patterns on our pipe,” he said.

When the Iroquois Gas Transmission System came online in 1991, it handled Western Canada gas coming to the northeastern United States, but Rupff said Northeast supply could outpace demand by 2017.

As companies aim to make those connections, Rupff said several drivers will guide which projects are ultimately successful.

Those include the actual sustainability of the Marcellus, as opposed to estimated decline curve models; the growth of end-use demand that would keep basins from competing; and the “stare down” between producers and local distribution companies.

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