The Marcellus Shale Coalition (MSC) in a letter Wednesday called on FERC to approve the PennEast Pipeline, joining an industry chorus urging the recently revamped agency to sign off on ripe applications for major northeast natural gas infrastructure.
MSC President David Spigelmyer told the Federal Energy Regulatory Commission that the Pennsylvania-based trade group’s 200 members “urge your swift approval of this certificate. The PennEast Pipeline will deliver clean-burning, low-cost and reliable energy to families and businesses across the region. Our organization and many citizens throughout the region are anxious to realize the economic and environmental benefits of this project and urge the Commission to approve the application as soon as possible.”
PennEast, a 1.1 Bcf/d, 120-mile pipeline designed to run from Luzerne County, PA, to an interconnect with the Transcontinental Gas Pipe Line (Transco) in Mercer County, NJ, would open up an additional pathway for eastern Marcellus Shale production to reach the market.
PennEast in early April received a favorable final environmental impact statement (FEIS), and like Nexus, would have been ripe for a federal authorization decision earlier had FERC been able to decide on pipeline certificates.
Trump administration nominees Neil Chatterjee and Robert Powelson were sworn in earlier this month, restoring the the commission’s quorum after its extended hiatus. Backers for both PennEast and Nexus wasted little time in reminding the Commission that the two Appalachian takeaway projects are still stuck in FERC’s backlog.
“Already, three government regulators, including FERC, have determined that PennEast can be constructed with minimal environmental impact,” Spigelmyer wrote Wednesday. PJM “also has said PennEast is needed for electric grid reliability…Swift commission action after months of delays is critical in order to ensure families and businesses in the region can realize the economic and environmental benefits of the project as soon as possible.”
Any incremental capacity out of the Appalachian Basin would be welcome news for producers, who have seen regional negative basis differentials roughly double since the spring. Dominion South has been trading at more than a dollar discount to Henry Hub since July, according to Daily GPI prices.
Meanwhile, Northeast production has been gradually increasing, averaging just over 24 Bcf/d month-to-date, up from about 22.8 Bcf/d in March, according to data from PointLogic Energy.
The production increase could be a result of producers ramping up in anticipation of new takeaway projects planned to hit the market this year, in particular the 3.25 Bcf/d Rover Pipeline. Though the highly-anticipated project has experienced some delays, backer Energy Transfer Partners LP recently told FERC it’s ready to bring Phase 1A into service by the end of the month.
FERC plans to resume holding monthly meetings in September, and the Commissioners have also been issuing notational orders on a near-daily basis since last week.
PennEast is jointly owned by NJR Pipeline Company; SJI Midstream; Southern Company Gas; Enbridge Inc. subsidiary Spectra Energy Partners; and UGI Energy Services. The developers have targeted an in-service date in the second half of 2018.
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