Ongoing Kinder Morgan pipeline projects

Natural gas pipelines

On 1 December 2015, Tennessee Gas Pipeline Company (TGP) placed the next capacity increment of its US$216 million South System Flexibility Project in service on schedule. 350 000 dkth/d of the 500 000 dkth/d project is now in service. The remaining capacity is scheduled to be placed in service on 1 December 2016.

On 1 November 2015, TGP placed the US$353 million Broad Run Flexibility Project in service on schedule. This project provides 590 000 dkth/d of firm transportation capacity from a receipt point on TGP's Broad Run Lateral in West Virginia to delivery points in Mississippi and Louisiana (USA). In 2014, Antero Resources was awarded 790 000 dkth/d of a 15 year firm capacity under the Broad Run Flexibility and Broad Run Expansion projects. Estimated capital expenditures for the combined projects are approximately US$800 million. Subject to regulatory approvals, the Broad Run Expansion project will provide an incremental 200 000 dkth/d of firm transportation capacity along the same capacity path. The anticipated in service date of the Broad Run Expansion project is 1 November 2017.

Several TGP projects, with total estimated investment of US$563 million, advanced through the FERC regulatory process during the quarter:

• FERC issued a notice of intent to prepare an environmental assessment for the proposed US$178 million, 900 000 dkth/d Southwest Louisiana Supply Project, designed to serve the Cameron LNG export complex. In service is expected by 1 February 2018.
• FERC issued a schedule for issuance of the environmental assessment for the US$156 million, 145 000 dkth/d Susquehanna West Project designed to deliver Marcellus supply to an interconnection with National Fuel Gas Supply LLC. Issuance of a FERC certificate is expected in May 2016; the anticipated in service date is 1 November 2017.
• FERC issued a notice of intent to prepare an environmental assessment for the US$142 million, 135 000 dkth/d Orion Project, designed to deliver Marcellus supply to an existing interconnection with Columbia Gas Transmission in Pike County, Pennsylvania. In service is expected in June 2018.

• FERC issued a schedule for issuance of the environmental assessment for the US$87 million, 180 000 dkth/d Triad Expansion Project, designed to serve a new Invenergy power plant in Lackawanna County, Pennsylvania. Issuance of a FERC certificate is expected in July 2016; the anticipated in service date is 1 November 2017.

On Oct. 15, 2015, the FERC released a notice indicating that the issuance of the Environmental Assessment for the approximately US$2 billion Elba Liquefaction Project will occur on 5 February 2016. As a result, the deadline for all federal authorisations required for issuance of the FERC certificate is 5 May 2016. The first of 10 liquefaction units is expected to be placed in service in the first quarter of 2018, with the remaining nine units coming online before the end of 2018. This project is supported by a 20 year contract with Shell.

The deadline for all federal authorisations required for issuance of FERC certificates for the expansion projects on the Elba Express (EEC) and Southern Natural Gas (SNG) pipelines coincides with the deadline for Elba Liquefaction (5 May 2016). Initial in service for these projects, with estimated investment totalling approximately US$306 million, is projected to be late third quarter or early fourth quarter of 2016.

Sierrita Gas Pipeline

Sierrita Gas Pipeline LLC announced in January 2016 that the joint venture plans to spend US$56 million to expand the capacity of the pipeline. The approximately 60 mile, 36 in. dia. pipeline, which currently provides 201 000 dkth/d of firm transportation capacity, will be expanded to a total capacity of 431 000 dkth/d. Sierrita completed an open season for expansion capacity on 5 October 2015, and awarded 230 000 dkth/d of expansion capacity to Comisión Federal de Electricidad (CFE) for a term of approximately 19.5 years beginning no later than April 2020. CFE has an option to increase the expansion capacity to 309 000 dkth/d, which would increase the pipeline's capacity to 510 000 dkth/d. A FERC application filing is anticipated by early 2018, and subject to regulatory approvals, the expansion project is expected to be placed into service in the spring of 2020.

Northeast Energy Direct

On 20 November 2015, TGP filed a FERC certificate application for both the market path and supply path portions of the Northeast Energy Direct Project (NED). The market path, from Wright (New York) to Dracut (Massachusetts) and beyond, currently has commitments totalling 652 762 dkth/d and is scalable up to 1.3 billion ft³/d. TGP continues discussions with potential shippers from an open season that closed 29 October, introducing PowerServe, a new firm service for electric distribution companies and electric generators in the northeast, using NED facilities. The NED project has an expected in service date of 1 November 2018.

NGPL

On 10 December, KMI and Brookfield Infrastructure Partners L.P. acquired – from Myria Holdings, Inc. – the 53% equity interest in Natural Gas Pipeline Company of America (NGPL) not already owned by them for a total purchase price of approximately US$242 million. KMI invested approximately US$136 million and increased its ownership interest from 20% - 50%. Brookfield Infrastructure invested approximately US$106 million and increased its ownership from approximately 27% - 50%. KMI continues to operate NGPL, and expects that the transaction will be immediately accretive to KMI’s cash available to pay dividends.

CO₂

Kinder Morgan’s approximately US309 million Cow Canyon expansion project in southwestern Colorado is near completion. This project's 200 million ft³/d CO₂ compression facility and a portion of the production wells and associated field facilities have been placed into service.

Construction continues on the approximately US$214 million northern portion of the Cortez Pipeline expansion project, which will increase CO₂ transportation capacity from 1.35 billion ft³/d - 1.5 billion ft³/d. The Cortez Pipeline transports CO₂ from southwestern Colorado to eastern New Mexico and West Texas for use in enhanced oil recovery projects. The project is on schedule to be completed in the second quarter of 2016.

Products pipelines

Volumes have continued to grow significantly on the Kinder Morgan Crude and Condensate (KMCC) system throughout 2015 as projects came online during the year. In December 2015, KMCC placed into service its new Marshall station and pipeline to connect additional Gonzales County production. KMCC is a 260 mile pipeline originating in the core of the Eagle Ford (Karnes, DeWitt and Gonzales counties) transporting crude and condensate to Texas Gulf Coast market outlets.

Kinder Morgan continues to make progress on its outreach, surveying and permitting activities for the proposed Palmetto Pipeline while the company awaits the outcome of its appeal of the Department of Transportation's decision to deny Palmetto's application for a Certificate of Public Convenience and Necessity. Palmetto will move gasoline, diesel and ethanol from Louisiana, Mississippi and South Carolina to points in South Carolina, Georgia and Florida. The approximately US$1 billion project has a design capacity of 167 000 bpd and will consist of a segment of expansion capacity on the Plantation pipeline that Palmetto will lease from Plantation Pipe Line Company, and a new 360 mile pipeline to be built from Belton, South Carolina, to Jacksonville, Florida. A revised in service date of December 2017 reflects additional permitting requirements for the project.

Work continues on the company’s approximately US$517 million Utopia East pipeline project. The new pipeline will originate in Harrison County, Ohio, and connect with Kinder Morgan’s existing pipeline and facilities in Fulton County, Ohio, transporting ethane and ethane-propane mixtures eastward to Windsor, Ontario, Canada. Utopia East will have an initial design capacity of 50 000 bpd, and the system is expandable to more than 75 000 bpd. The project is fully supported by a long-term, fee-based transportation agreement with a petrochemical customer. Subject to permitting and regulatory approvals, the project remains on track for an in service date of early 2018.

Kinder Morgan Canada

Kinder Morgan Canada is currently seeking approval from the National Energy Board (NEB) for the Trans Mountain Expansion Project. The company filed its final closing argument with the NEB on 15 December 2015, and presented its oral argument on 17 December 2015. Final intervenor arguments were due 12 January 2016, with the intervenor oral hearings commencing 19 January 2016, and concluding on 5 February 2016. The NEB recommendation is scheduled for 20 May 2016. Current legislation specifies that the federal government has 90 days following the NEB recommendations to issue its decision. The in service date for the expansion will depend on the final conditions contained in the NEB recommendation and the final Order In Council from the new federal government.

The company expects the project to be in service by the third quarter of 2019. The proposed US$5.4 billion expansion will increase capacity on Trans Mountain from approximately 300 000 – 890 000 bpd. Thirteen companies have signed firm long-term contracts supporting the project for approximately 708 000 bpd. Kinder Morgan Canada continues to engage extensively with landowners, Aboriginal groups, communities and stakeholders along the proposed expansion route, and marine communities.

Edited from source by Stephanie Roker

Read the article online at: https://www.worldpipelines.com/project-news/25012016/ongoing-kinder-morgan-pipeline-projects/