On Monday, Enbridge Inc., a Canadian company, announced plans to develop a natural gas liquids pipeline from the Marcellus shale in southwestern Pennsylvania and northern West Virginia to Chicago and Canadian markets. The company expects to finish evaluating various routing and market alternatives by second-quarter 2010.
The oil pipeline giant said that it's gauging interest from natural gas energy companies (producers). If finalized, it would pipe liquefied gas from the Marcellus find to the Aux Sable processing facilities outside Chicago, explained Troy Rilea, Enbridge's director of gas planning and projects.
"We think this is a very good longer-term option for addressing the needs of the Marcellus," he added. "It appears that there will be strong growth of NGLs (natural gas liquids) in this region. By taking them over to the Chicago region, we will be able to handle a lot of those liquids."
Enbridge owns a 43% stake in the Aux Sable facility. It also owns a 50% stake of the Alliance Pipeline, which supplies the plant with the bulk of its natural gas. The pipeline could be in service as soon as early 2013 if all regulatory and landowner issues are resolved without issue.
The massive Marcellus formation sitting below Pennsylvania and West Virginia is the one of the hottest shale gas plays in North America, attracting billions of dollars in investment from U.S. and Canadian companies over the past two years. Recent estimates peg the southwestern Pennsylvania play could yield as much as 50 trillion cubic feet in recoverable natural gas, which only recently became economic to produce through the use of horizontal drilling techniques.
Timing of the proposed Marcellus line would come as production from the shale play ramps up. As much as 100,000 barrels per day of natural gas liquids could come out of the Marcellus, according to the company. But the gas production and storage infrastructure, common to the Texas and Louisianna shale plays, is not yet in place.