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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--A coalition of four energy companies plans to spend up to $5 billion to build a 550-mile natural gas pipeline to bring up to 1.5 billion cubic feet of gas per day (BCF/d) from the Marcellus and Utica shale formations to power plants, homes and businesses in North Carolina and Virginia.
The Atlantic Coast Pipeline could kick off construction in 2016 and be operational by late 2018, if it receives all of its regulatory permits in the expected timeline. The pipeline is owned by Dominion Resources Incorporated (NYSE:D) (Richmond, Virginia), Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina), Piedmont Natural Gas Company Incorporated (NYSE:PNY) (Charlotte) and AGL Resources Incorporated (NYSE:GAS) (Atlanta, Georgia).
View Project Report - 300168124 300167416 300168253 300168120 300168134 300168252 300181146
It won't be easy. Regulatory approvals will be needed from 40 federal, state and local agencies before construction can begin. At the end of October, Dominion asked the Federal Energy Regulatory Commission (FERC) (Washington, D.C.) to begin its environmental review process for the pipeline. Already, local opposition has developed along the proposed route, with some landowners refusing to grant Dominion access to their property for surveying work.
The proposed pipeline would run from Harrison County, West Virginia, southeast through Virginia with an extension to Chesapeake, Virginia, and then south through eastern North Carolina to Robeson County. The main pipeline would have a 42-inch diameter in West Virginia and Virginia. In North Carolina, the pipeline would be 36 inches in diameter. Right now, North Carolina's natural gas is supplied mainly by a single major wholesale interstate natural gas pipeline that runs through the western portion of the state.
Click on the image at right to view a high-level route map for the proposed pipeline.
"This is an important project connecting a region where gas production is rising rapidly, to a region where gas consumption is rising rapidly," said Jesus Davis, Industrial Info's vice president of research for the Oil & Gas Production, Pipelines and Terminals industries. "There's some early NIMBY opposition, but that's to be expected these days. The Atlantic Coast Pipeline is a smart response to current trends in energy production, as well as environmental regulation."
Officials with the pipeline say it has a lot of support among elected officials, businesses and economic development professionals in West Virginia, Virginia and North Carolina. More than 30 federal, state and local elected officials, and chambers of commerce or economic development groups, have provided letters of support or passed resolutions in favor of the project. In addition, more than 5,500 letters supporting the pipeline have been received by elected officials in Virginia, West Virginia and North Carolina, project owners point out.
"The broad and enthusiastic support we have received since announcing the project ... is further evidence of how important the Atlantic Coast Pipeline is to the future of the region," said Diane Leopold, president of Dominion Energy, in a statement October 31. "Along with creating thousands of jobs and millions of dollars in new tax revenues for states and localities, it can act as a catalyst for future economic development, help stabilize energy prices for consumers and businesses, and promote cleaner air."
Natural gas generation has increased dramatically in North Carolina and Virginia in recent years, as tighter environmental regulations have caused power companies to close older, less-efficient coal-fired generation and replaced it with gas-fired generation.
Demand for gas-fired power generation grew 459% in North Carolina and 123% in Virginia between 2008 and 2013, the pipeline owners said. The U.S. Energy Information Administration's (EIA) (Washington, D.C.) 2014 Annual Energy Outlook reported that demand for natural gas for all uses grew 50% in North Carolina and 37% in Virginia between 2008 and 2012.
In North Carolina, the proposed pipeline would provide natural gas to the following power stations operated by Duke Energy:
Click on the image at right to see the dramatic gains in natural gas production from the Marcellus Shale.
Natural gas production in the Utica Shale also is surging, but that region is in a much earlier stage of development. The EIA's Drilling Productivity Report for the Utica Shale shows dramatic production gains during the last 24 months. Gas production there is about 1.6 BCF/d, according to the EIA.
Click on the image at right to see the dramatic gains in natural gas production from the Utica Shale.
A study sponsored by the pipeline owners estimates the project could generate a total of $2.7 billion in economic impact from 2014 through 2019 in the three-state region, supporting 17,240 cumulative jobs.
The four companies' ownership stakes are: Dominion, 45%; Duke Energy, 40%; Piedmont, 10%; and AGL Resources, 5%.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
The Atlantic Coast Pipeline could kick off construction in 2016 and be operational by late 2018, if it receives all of its regulatory permits in the expected timeline. The pipeline is owned by Dominion Resources Incorporated (NYSE:D) (Richmond, Virginia), Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina), Piedmont Natural Gas Company Incorporated (NYSE:PNY) (Charlotte) and AGL Resources Incorporated (NYSE:GAS) (Atlanta, Georgia).
View Project Report - 300168124 300167416 300168253 300168120 300168134 300168252 300181146
It won't be easy. Regulatory approvals will be needed from 40 federal, state and local agencies before construction can begin. At the end of October, Dominion asked the Federal Energy Regulatory Commission (FERC) (Washington, D.C.) to begin its environmental review process for the pipeline. Already, local opposition has developed along the proposed route, with some landowners refusing to grant Dominion access to their property for surveying work.
The proposed pipeline would run from Harrison County, West Virginia, southeast through Virginia with an extension to Chesapeake, Virginia, and then south through eastern North Carolina to Robeson County. The main pipeline would have a 42-inch diameter in West Virginia and Virginia. In North Carolina, the pipeline would be 36 inches in diameter. Right now, North Carolina's natural gas is supplied mainly by a single major wholesale interstate natural gas pipeline that runs through the western portion of the state.
Click on the image at right to view a high-level route map for the proposed pipeline."This is an important project connecting a region where gas production is rising rapidly, to a region where gas consumption is rising rapidly," said Jesus Davis, Industrial Info's vice president of research for the Oil & Gas Production, Pipelines and Terminals industries. "There's some early NIMBY opposition, but that's to be expected these days. The Atlantic Coast Pipeline is a smart response to current trends in energy production, as well as environmental regulation."
Officials with the pipeline say it has a lot of support among elected officials, businesses and economic development professionals in West Virginia, Virginia and North Carolina. More than 30 federal, state and local elected officials, and chambers of commerce or economic development groups, have provided letters of support or passed resolutions in favor of the project. In addition, more than 5,500 letters supporting the pipeline have been received by elected officials in Virginia, West Virginia and North Carolina, project owners point out.
"The broad and enthusiastic support we have received since announcing the project ... is further evidence of how important the Atlantic Coast Pipeline is to the future of the region," said Diane Leopold, president of Dominion Energy, in a statement October 31. "Along with creating thousands of jobs and millions of dollars in new tax revenues for states and localities, it can act as a catalyst for future economic development, help stabilize energy prices for consumers and businesses, and promote cleaner air."
Natural gas generation has increased dramatically in North Carolina and Virginia in recent years, as tighter environmental regulations have caused power companies to close older, less-efficient coal-fired generation and replaced it with gas-fired generation.
Demand for gas-fired power generation grew 459% in North Carolina and 123% in Virginia between 2008 and 2013, the pipeline owners said. The U.S. Energy Information Administration's (EIA) (Washington, D.C.) 2014 Annual Energy Outlook reported that demand for natural gas for all uses grew 50% in North Carolina and 37% in Virginia between 2008 and 2012.
In North Carolina, the proposed pipeline would provide natural gas to the following power stations operated by Duke Energy:
- Dan River Combined-Cycle, in Rockingham County
- Buck Combined-Cycle, in Rowan County
- H.F. Lee Energy Complex, in Wayne County
- Smith Energy Complex, in Hamlet
- Sutton Energy Complex, in Wilmington
Click on the image at right to see the dramatic gains in natural gas production from the Marcellus Shale.Natural gas production in the Utica Shale also is surging, but that region is in a much earlier stage of development. The EIA's Drilling Productivity Report for the Utica Shale shows dramatic production gains during the last 24 months. Gas production there is about 1.6 BCF/d, according to the EIA.
Click on the image at right to see the dramatic gains in natural gas production from the Utica Shale.A study sponsored by the pipeline owners estimates the project could generate a total of $2.7 billion in economic impact from 2014 through 2019 in the three-state region, supporting 17,240 cumulative jobs.
The four companies' ownership stakes are: Dominion, 45%; Duke Energy, 40%; Piedmont, 10%; and AGL Resources, 5%.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
