WGL announces investment in Atlantic Sunrise pipeline project

Through its subsidiary WGL Midstream, Inc., WGL Holdings, Inc., is the lead investor in an agreement with three other parties to create a company that will jointly develop and own, together with Transcontinental Gas Pipe Line Company, (Transco) LLC, the Central Penn Line, a 177 mile pipeline originating in Susquehanna County and extending to Lancaster County, Pennsylvania. The Central Penn Line is the greenfield pipeline segment of Transco's recently announced Atlantic Sunrise project, which currently has a projected in-service date in the second half of 2017. The project will be instrumental in addressing the current challenge of transporting natural gas from an area with abundant supply to existing established markets.

As part of the agreement, WGL Midstream will invest approximately US$ 410 million, resulting in a majority ownership interest in the company, which will co-own the Central Penn Line with Transco. This transaction is WGL Midstream's second significant investment in natural gas infrastructure in less than nine months and it will provide the company with sustainable, regulated earnings. The transaction additionally reaffirms WGL's strategy to grow a portfolio of infrastructure investments in clean and efficient energy assets across the US.

The Central Penn Line, as part of Atlantic Sunrise, is a natural gas pipeline project designed to provide new firm gas transportation capacity from various supply points in northeast Pennsylvania to a delivery point into Transco's mainline in southeast Pennsylvania. It will be part of a transformational project in light of the increased production of natural gas in the Marcellus region, particularly in northern Pennsylvania. The pipeline will have the capacity to transport and deliver up to approximately 1.7 million Dth/d of natural gas.

"As the need for natural gas continues to increase, WGL is well positioned to meet future demand levels and will be able to continue to provide more businesses and residential customers with the benefits of safe and reliable natural gas," said WGL Chairman and Chief Executive Officer, Terry D. McCallister. "We have a platform that not only reinforces our regional natural gas delivery system, but also provides asset ownership."

In connection with the US$ 410 million investment, WGL Midstream entered into an agreement with Cabot Oil and Gas Corporation to purchase 500 000 Dth/d of natural gas over a 15-year term. The structure of this agreement provides WGL Midstream with low-risk access to Marcellus supply.

Adapted from press release by Rosalie Starling

Read the article online at: https://www.worldpipelines.com/business-news/21022014/wgl_announces_410_million_investment_in_atlantic_sunrise_pipeline_project_101/