Appalachian natural gas producers got good news earlier this month: Williams announced it was moving forward with the Southeast Supply Enhancement project, a large-scale expansion of southbound capacity out of the Northeast on its Transco Pipeline system. Not only that, but it super-sized the project to 1.4 Bcf/d of capacity — nearly double the 800 MMcf/d it had offered in an open season held this summer. The project is one of several brownfield expansions planned to provide additional supply access in Transco’s premium Zone 5 market area, which runs through Virginia and North Carolina — and the first large-scale takeaway expansion to be announced in the area since the long-delayed Mountain Valley Pipeline (MVP) was cleared for completion following years of regulatory and legal hurdles. In today’s RBN blog, we provide the latest on the Transco Corridor expansions.
When it comes to midstream development in the Northeast, Appalachian gas producers have learned by now not to hold their breath. The region is notorious for its staunch environmental opposition to hydrocarbon infrastructure projects and its propensity for sending gas pipeline projects to the trash pile. However, against all odds, midstream development in the region has thawed in recent months, in large part spurred by the unlikely advancement of MVP (dashed blue-and-black line in Figure 1), the long-embattled project to move up to 2 Bcf/d from the Appalachia gas supply basin to the Transco Corridor.
It took nothing less than an “Act of Congress” and a U.S. Supreme Court ruling for MVP to ultimately overcome its legal battles. However, the project is now on its way to being completed next year. Construction resumed in late July/early August and is progressing, albeit more slowly than expected. Equitrans Midstream, the lead developer on the project, recently pushed back the completion date to Q1 2024, from the end of 2023 previously, citing several factors, including a slower ramp-up of the contractor workforce, challenging terrain and increased safety and environmental protocols. [Equitrans reached an agreement in early October with the U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) to resolve a safety order issued in early August due to concerns about potential corrosion of pipeline material that was exposed to the elements during the extended period when the project was stalled.] In its Q3 earnings call, Equitrans said it expected to complete the bulk of the remaining construction by the end of this year and begin commissioning the system in January.
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