Four major US energy companies form JV for $4.5-$5B natural gas Atlantic Coast pipeline
03 September 2014
Four major U.S. energy companies—Dominion, Duke Energy, Piedmont Natural Gas and AGL Resources—have formed a joint venture to build and own the proposed Atlantic Coast Pipeline. The $4.5-billion to $5-billion, 550-mile (885 km) natural gas pipeline would run from Harrison County, W. Va., southeast through Virginia with an extension to Chesapeake, Va., and then south through central North Carolina to Robeson County. The capacity of the pipeline is projected to be 1.5 billion cubic feet/day.
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Route map. Click to enlarge. Pdf version here. |
The partnership, called Atlantic Coast Pipeline LLC, will own the pipeline initially proposed by Dominion as the Southeast Reliability Project. It is designed in part to meet the needs identified in requests for proposals last April by Duke Energy and Piedmont, and in June by Virginia Power Services Energy. It would deliver natural gas supplies to growing markets for additional customers in Virginia and North Carolina. The pipeline would provide a new route for direct access to the burgeoning production in the Marcellus and Utica shale basins of West Virginia, Pennsylvania and Ohio.
Dominion is to build and operate the Atlantic Coast Pipeline on behalf of the venture. With more than 100 years of service, Dominion is one of the US’ most-experienced operators of natural gas pipelines. It operates nearly 8,000 miles of interstate pipeline in six states as well as one of the largest natural gas storage systems in the country.
The joint venture ownership stakes are: Dominion, 45%; Duke Energy, 40%; Piedmont, 10%; and AGL Resources, 5%. Subsidiaries and affiliates of all four joint venture partners plan to be customers of the pipeline under 20-year contracts, pending regulatory approvals. PSNC Energy also plans to be a customer of the pipeline under a 20-year contract, pending regulatory approvals.
Dominion has begun surveying to determine the best route, one that meets operational and reliability needs while minimizing the impact on the environment as well as historical and cultural resources. The company plans to make a pre-filing request with the Federal Energy Regulatory Commission (FERC) this fall on behalf of Atlantic Coast Pipeline. It expects to file its FERC application in the summer of 2015, receive the FERC Certificate of Public Convenience and Necessity in the summer of 2016, and begin construction shortly thereafter.
The main pipeline would have a 42-inch diameter in West Virginia and Virginia, reducing to 36 inches in diameter in North Carolina. Three compressor stations have been planned as part of this project—one at the beginning of the pipeline in West Virginia; one in central Virginia (Buckingham County); and one near the Virginia-North Carolina state line.
The range of normal operating pressure on the pipeline would be from 750 pounds per square inch gauge (psig) to 1,440 psig, its Maximum Allowable Operating Pressure. The pipeline would be designed with redundant safety systems to ensure this maximum pressure is not exceeded.
In announcing their request for proposals, Duke Energy noted increasing reliance on natural gas to generate electricity, and Piedmont cited growing customer demand. Currently, North Carolina is served primarily by a single major wholesale interstate natural gas pipeline that runs through the western portion of the state.
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