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Has American Midstream solved the Midla pipeline abandonment debate?

After months of disputes, a settlement has finally been reached by American Midstream Partners LP regarding the abandonment of the Midla natural gas pipeline system. According to Charlie Passut for Natural Gas Intelligence, American Midstream will apply to the Federal Energy Regulatory Commission (FERC) to build a new pipeline.

American Midstream will be responsible for the construction, ownership, operation and maintenance of the replacement system, dubbed the Natchez Line. This new 12-inch line will stretch 52 miles from Winnsboro, Louisiana, to Natchez, Mississippi. American Midstream plans to use most of the Midla pipeline’s existing route and rights-of-way in the construction of the Natchez Line.

Though American Midstream must still complete an environmental review and prepare the necessary documents before it can officially file its application with FERC, the company has already organized anchor shippers for the new line. Atmos Energy Corp., the Louisiana Municipal Gas Authority and BASF Corp. have all made agreements with American Midstream for the use of the line.

The agreement with each company also requires that each company pressure FERC to allow American Midstream to abandon the 88-year-old pipeline. The company wishes to shed the pipeline on the grounds that its aging structure requires excessive maintenance costs.

For more information on American Midstream’s new Natchez Line proposal, see Passut’s full article here.

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