Atlantic Sunrise Pipeline Project Plods Ahead

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Researched by Industrial Info Resources (Sugar Land, Texas)--The proposed Atlantic Sunrise natural gas pipeline continues to plod forward. True to its word, the Federal Energy Regulatory Commission (FERC) issued a final environmental impact statement (EIS) on the project on Friday. FERC plans to issue a final ruling early this year.

The environmental impact statement, which is generally favorable toward the project, marks a significant milestone in the development of the nearly $3 billion pipeline by Williams Partners L.P. (NYSE:WPZ) (Tulsa, Oklahoma), which would deliver natural gas from the Marcellus Shale region in Pennsylvania to markets in the U.S. Southeast. In October last year, Williams Partners said it would push back planned full in-service operations of the pipeline to mid-2018 from late 2017 as a result of a delay in the completion of FERC's review. FERC says it will rule on the project March 30, 2017. However, Williams adds it plans to begin partial service in the second half of 2017. Williams had earlier sought to have the 187-mile pipeline in full service in late 2017.

Aimed at alleviating infrastructure bottlenecks in Pennsylvania, the 187-mile Atlantic Sunrise pipeline would connect with Williams Partners' massive Transcontinental gas pipeline (Transco) system. Nearly all of the new pipeline will be in Pennsylvania, with a small section of existing pipeline to be replaced in Virginia. There will be several compressor station modification projects (compressor unit additions and/or piping modifications) along the existing Transco pipeline in Pennsylvania, Maryland and North Carolina and a new station in Pennsylvania.

FERC issued a statement on Friday saying its staff "determined that construction and operation of the Project would result in some adverse environmental impacts, but impacts would be reduced to less-than-significant levels with the implementation of Transco's proposed and FERC staff's recommended mitigation measures."

Among other things, FERC noted about 27% of the project pipeline would be within or next to existing rights-of-way, consisting of existing pipelines and/or electric transmission line rights-of-way.

The project has drawn some intense local opposition. An attorney for Pennsylvania landowner Geraldine Nesbitt issued a press statement last week saying the pipeline route threatens "priceless cultural and environmental resources."

Meanwhile, Dan O. Dinges, chief executive officer of Cabot Oil & Gas Corporation (NYSE:COG) (Houston, Texas), which would deliver gas through the Atlantic Sunrise pipeline, hailed the release of the environmental impact statement as a major milestone in the project's progression. Cabot said it has agreements to sell as much as 1 million MMBtu (million British thermal units) per day via the proposed pipeline.

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