$1B natural gas pipeline would run through Valley

A consortium of companies in the power and gas industries announced its big-pipe dream in August.

PennEast Pipeline Partners of Wyomissing said it planned to invest nearly $1 billion to build a 108-mile, 36-inch diameter underground natural gas pipeline that will run from the Marcellus shale region in Luzerne County in northeastern Pennsylvania to Transco’s Trenton-Woodbury interconnection in New Jersey. The route takes the pipeline through Carbon, Northampton and Bucks counties in the region, making it one of the top business stories of the year in the Greater Lehigh Valley.

While the plans and exact route have changed slightly since the original announcement – for example, route changes have made the line grow by 8 miles from its original 100 – the proposal is proceeding on schedule, said PennEast spokeswoman Patricia Kornick.

PennEast Pipeline Partners is made up of UGI Energy Services of Reading; Spectra Energy Partners of Harrisburg; AGL Resources of Atlanta; NJR Pipeline Co. of Wall Township, N.J.; South Jersey Industries of Folsom, N.J.; and PSEG Power LLC of Newark, N.J.

UGI will serve as the pipeline manager when the project is complete.

Kornick said the project is still in its very early stages, so no one should expect to see shovels going into the ground anytime soon.

“The overall process can take two to three years,” she noted, projecting completion by the end of 2017.

As 2014 winds to a close, the partners are still in the fact-finding stages.

To begin that process, PennEast spent much of November visiting affected communities to explain its plans – an essential part of the pre-approval process.

“Interstate natural gas pipelines are subject to stringent review and [Federal Energy Regulatory Commission] oversight,” said Peter Terranova, chairman of the PennEast board of managers. “PennEast requested to use the pre-filing process because it provides an ideal framework for obtaining early input from potentially affected landowners and other stakeholders. Their input helps identify areas of concern that we can try to address from the start through the design of the project.”

Kornick said PennEast held four open houses, three in Pennsylvania and one in New Jersey, to accept public input and explain the process. More than 1,100 people showed up between the four sessions.

“There’s been a general lack of understanding about how natural gas is transported and produced,” she said. “We wanted people to be able to form their opinions based on the facts.”

Also, engineering survey crews now are on the ground to bring a real-world perspective to the initial route proposed by the partners. They’re looking at how the landscape could differ from what they expected and amending the proposal accordingly.

There also are considerations such as Madison Farms, a planned residential and retail development that recently broke ground in Bethlehem Township, which would be in the path of the pipeline.

Kornick said the partners are looking at that and several other factors that could determine the pipeline’s final route.

Once that is determined, the partners expect to make a final formal filing with the Federal Energy Regulatory Commission in the third quarter of next year, she said.

Meanwhile, the company will be using communication tools to keep the public, community leaders and affected landowners updated on changes and progress, Kornick said.

If approval is granted, the seven-month construction project to build the underground pipeline would begin as early as 2017.

It is estimated that construction will create more than 2,000 jobs in the region, Kornick said.

The pipeline is expected to go into service later in 2017, transporting up to one billion cubic feet of natural gas per day, enough to serve around 4.7 million households.

One major change since the plan was introduced in August is the price of oil, which has dropped dramatically.

In August, crude oil was selling for more than $100 per barrel. By mid-December, the price was in the mid-$50 range.

The lower price of the competing energy source has not changed plans for the pipeline, Kornick said.

“We are staying the course,” she said.

Kornick said price isn’t the only factor in determining the value of the project. She said having a dedicated pipeline also will provide a reliable source of fuel to the region, which is one of advantages that attracted Spectra Energy to the partnership.

“The PennEast Pipeline will deliver much-needed natural gas to address the region’s reliability concerns and reduce costs paid by consumers,” said Bill Yardley, president of U.S. transmission and storage for Spectra Energy.

And, Kornick said, if there is another polar vortex such as the one that ushered in 2014 with bad weather, the pipeline will be able to provide heating fuel to customers without interruption.

Source: LVB.com