Inergy Midstream, UGI And WGL Announce Non-Binding Open Season For Commonwealth Pipeline
Inergy Midstream, L.P. (NYSE:NRGM), UGI Energy Services, Inc. a subsidiary of UGI Corporation (NYSE: UGI), and Capitol Energy Ventures Corp., a subsidiary of WGL Holdings, Inc. (NYSE:WGL), today announced they are conducting a non-binding Open Season for shippers desiring to transport natural gas volumes on the proposed Commonwealth Pipeline.
The proposed pipeline will transport up to 1.2 Bcf of natural gas per day to city gates and interstate pipeline systems at points between the southern terminus of Inergy Midstream’s MARC I line (at the interconnect with Transcontinental Gas Pipe Line Company, LLC’s Leidy Line near Station # 517 in Lycoming County, Pennsylvania) and the Dominion Cove Point LNG, LP pipeline in Charles County, Maryland. The primary purpose of the Commonwealth Pipeline is to provide a direct and flexible path for bringing natural gas produced in the Marcellus and Utica Shale plays in Pennsylvania and neighboring states to growing natural gas markets in central and eastern Pennsylvania; the metropolitan areas of Philadelphia, Baltimore, and Washington, D.C.; and the Delmarva Peninsula.
The proposed project is targeting shippers seeking (i) additional supply flexibility, diversity, and reliability; (ii) liquid points for trading locally-produced Marcellus and Utica shale gas; (iii) direct access to premium markets in the Northeast and Mid-Atlantic region, including new delivery points to constrained areas in the greater Washington, D.C. metropolitan area; (iv) the ability to capture pricing differentials between the various interconnected market pipelines; and (v) firm access to long-lived dry gas reserves that will not require the additional expense and potential interruptibility of natural gas liquids (“NGL”) processing. Commonwealth will provide shippers additional opportunities to buy and sell supplies, and to transport natural gas to where it is needed and valued most. This “market pull” project will provide shippers with a short-haul transportation option for direct access to Marcellus and Utica Shale gas supplies, thereby eliminating the expense of system-wide fuel and maintenance costs associated with long-haul pipelines traditionally bringing Gulf Coast supply to the Northeast and Mid-Atlantic markets.
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