Last week, a major Marcellus shale natural gas industry event happened, one that may bode well for royalty payments.
Williams Partners announced completion of their Transco pipeline upgrade – the Northeast Supply Link Expansion. Williams started flowing gas through the remainder of the Transco upgrade, adding 250,000 dekatherms per day, enough gas to meet the needs of 1 million Northeast homes.
And, Kinder Morgan started flowing natural gas through their newly added Northeast Upgrade to the Tennessee Gas Pipeline. That brought an additional 636,000 dekatherms per day of extra capacity to the system, enough to meet the needs of 2.5 million Northeast homes.
The new Marcellus shale is flowing to East Coast cities like New York, Philadelphia, Washington, DC, Atlanta and Charlotte – just in time for the 2013-2014 winter heating season, and (b) they're in the midst of spending another $1.5 billion on infrastructure projects in the Marcellus/Utica–right now…
The Williams Partners project brings half of the supply pipeline into service three months ahead of schedule. It's the first major expansion of the Transco natural gas pipeline designed specifically to connect Marcellus natural gas supply with Northeastern markets.
The expansion provides 250,000 dekatherms of incremental firm natural gas transportation capacity from Marcellus supplies direct to nearby customers in Pennsylvania, New Jersey and New York. The total expansion is delivering enough natural gas to provide service to approximately 1 million homes.
"We are currently executing on approximately $1.5 billion in other natural gas transportation projects, including our interest in the Constitution interstate gas pipeline," reports Rory Miller, senior vice president of Williams Partners' Atlantic-Gulf business segment. The project involved constructing about 13 miles of pipe in Pennsylvania and New Jersey, plus modifications to existing compressor facilities and installing a new 25,000 horsepower compressor station in Essex County, N.J.
The Transco pipeline is a 10,200-mile system providing natural gas transportation and storage services for markets throughout the Northeast and Southeast. Transco's major customers are primarily power generators, local distribution companies and producers.
Information courtesy of Marcellus Drilling News