Williams Co. subsidiary Transcontinental Gas Pipe Line filed itsMarketLink Expansion Project with FERC yesterday, requestingauthorization to spend $529 million to build about 150 miles of42-inch and 36-inch diameter pipeline looping and more than 60,000hp of new compression along its Leidy Line and mainline in theNortheast. The pipeline expansion is designed to be a downstreamlink to northeastern gas markets primarily for supply arriving atthe Leidy Hub in Pennsylvania through the proposed IndependencePipeline, a 916 MMcf/d gas pipeline that would extend fromDefiance, OH. Independence, MarketLink and ANR Pipeline’sSupplyLink would be three parts to a new interstate gastransportation corridor stretching from the Chicago Hub to theNortheast.

The MarketLink project will add 700,000 Dth/d of new firmtransportation capacity from Leidy, PA, to delivery points onTransco’s system in the Mid-Atlantic and Southeast regions of theU.S.

“The MarketLink project will provide the most flexible andprice-competitive link to transport Canadian and Midwestern gassupplies to rapidly growing markets in New York, New Jersey andPennsylvania and upstream markets along the Atlantic Seaboard whichare accessible through backhaul arrangements on Transco’s system,”said Cuba Wadlington Jr., senior vice president and general managerof Transco. “The project will also provide shippers with increasedaccess to diverse gas supplies at the Leidy Hub, which willincrease competition among fuel sources and enhance systemreliability.”

Included with the MarketLink application were precedentagreements with nine shippers for 663,000 Dth/d, or 95% of thecapacity of the project. Most of the agreements were for 10-yearterms. The largest shippers would be Engage Energy, with 210,000Dth/d, and Williams Energy Services, with 210,000 Dth/d. The othershippers include AEC Marketing (15,000 Dth/d), Coral Energy(50,000), Eastern Energy Marketing (90,000), Enron Capital andTrade Resources (30,000), LFG Energy (5,000), Natural GasClearinghouse (30,000) and Renaissance Energy (23,000). Theproposed in-service date for MarketLink is Nov. 1, 2000.

Transco offered negotiated rates for the project based on thedelivery point and term of the contract. The initial recourse ratefor firm transportation service will be an incremental monthlyreservation rate of $13.3211/Dth.

To add further proof its expansion is needed, Transco filedregional gas demand forecasts by Data Resources Inc., the Gasresearch Institute and the Energy Information Administration. Anaverage of the three forecasts shows that for the 1997-2010 periodthere should be incremental gas demand growth in the Mid-Atlanticand South Atlantic regions of 5.1 Bcf/d.

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