Operation

Constitution Pipeline Co. LLC has filed its long-awaited application with FERC seeking approval to construct a pipeline to carry natural gas from northern Pennsylvania’s Marcellus Shale to Northeast markets, the company said Friday, and Iroquois Gas Transmission has filed an application to build a key interconnect project.

States should have the authority to decide the level of activity on the Outer Continental Shelf (OCS), a group of Republican governors said this week at the Offshore Technology Conference (OTC) in Houston.

Sunoco Logistics Partners LP has received enough binding commitments to enable its Mariner South Pipeline project to proceed. Mariner South will transport export-grade propane and butane from Lone Star NGL LLC’s storage and fractionation complex in Mont Belvieu, TX, to Sunoco Logistics’ terminal in Nederland, TX. A binding open season continues to solicit additional business (see Shale Daily, March 22). In addition to propane and butane, the pipeline will be available for other natural gas liquids and petroleum products depending on shipper interest, Sunoco Logistics said. It is expected to have initial capacity of 200,000 b/d with the potential for expansion. Operation is expected during the first quarter of 2015.

Pro and con on the proposed northern segment of the Keystone XL oil pipeline from Canada to the Gulf of Mexico (GOM) rachetted up their campaigns this week in anticipation of a U.S. State Department hearing on the project Thursday in Grand Island, NE.

Enterprise Products Partners LP has sold out capacity at its planned 1.65 billion pounds/year propane dehydrogenation (PDH), which is scheduled to begin operation during the third quarter of 2015. In anticipation of a continuing decrease in supplies of propylene, Enterprise is in talks with additional customers that could lead to the development of additional PDH capacity, the company said. Last June Enterprise said it would build a PDH facility on the Texas Gulf Coast that would consume up to 35,000 b/d of propane to produce 1.65 billion pounds/year (750,000 metric tons per year or 25,000 b/d) of polymer-grade propylene (PGP) (see Shale Daily, June 22, 2012). The facility is to be integrated with the partnership’s existing propylene fractionation facilities, which have capacity of 5.3 billion pounds/year. The PDH facility will also be integrated with Enterprise’s PGP storage facilities, 102-mile distribution pipeline system and export terminal. “This [PDH capacity] demand is being driven by the combination of a 38% decrease in propylene supplies since 2006 due to additional ethane consumption by U.S. petrochemical companies and the growing supplies of domestic propane from the U.S. shale plays,” said Jim Teague, COO of Enterprise’s general partner.

The number of original drilling permits issued in Texas during November declined from one year ago, as did the amount of natural gas produced from Texas wells during October compared to a year ago, according to Railroad Commission of Texas (RRC) figures.

DTE Pipeline Co. began Tuesday began operation of its Bluestone Gathering pipeline system in Susquehanna County, PA. The southern portion of the pipeline connects gas production of Southwestern Energy to the Tennessee Gas Pipeline in Lenox Township, PA (see Shale Daily, July 6, 2011). The pipeline has a capacity of 275 million cubic feet per day. The remaining 32 miles of pipeline will interconnect with the Millennium Pipeline in Sanford, NY and should be completed in January, DTE said. Bluestone Gathering is being developed as the Bluestone Pipeline Co. of Pennsylvania LLC, Bluestone Gas Corp. of New York Inc. and Susquehanna Gathering Co. I LLC, all of which are subsidiaries of DTE Pipeline, an affiliate of DTE Energy. Bluestone is DTE’s first natural gas gathering project outside Michigan. DTE Pipeline also is a 40% owner of the Vector Pipeline, 26.25% owner of the Millennium Pipeline and 33% owner of the recently announced Nexus Gas Transmission System.

A bill signed by President Obama Tuesday allows for the construction and operation of natural gas pipeline facilities in the New York portion of the Gateway National Recreation Center, a 26,600-acre National Recreation Area in the Port of New York and New Jersey. HR 2606, which was introduced last year by three congressman representing Brooklyn and Queens — Republicans Michael Grimm and Robert Turner, and Democrat Gregory Meeks — was approved by the House and Senate earlier this year. The legislation will allow a new pipeline to be built off of an existing Williams pipeline to replace a 40-60 year old pipe and bring natural gas from New Jersey to Long Island. The pipeline will pass under Jacob Riis Park in the Rockaways portion of Queens and under Jamaica Bay to a new meter and regulator station on Floyd Bennett Field in Brooklyn. The project would generate an estimated $265 million on construction activity and 300 construction jobs, according to Grimm.

Teak Midstream LLC’s 200 MMcf/d Silver Oak cryogenic gas processing plant is now online in South Texas, along with 250 miles of gathering and residue delivery pipelines, the company said Tuesday.