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Columbia to build 160 mile natural gas pipeline

Dan Gearino | The Columbus Dispatch (Columbus, Ohio)

A proposed pipeline crossing part of Ohio would be an interstate highway for natural gas, connecting the Utica and Marcellus shale regions to the Gulf Coast.

Columbia Pipeline Group said yesterday that it plans to spend $1.75 billion on a series of projects, including a new pipe to run 140 miles from central Ohio to the northern tip of West Virginia.

The pipeline, called Leach XPress, would increase the capacity of the company’s delivery system by 1.5 billion cubic feet of gas per day.

“It’s one of the largest, if not the largest, project we’ve ever undertaken,” said Katie Dupuis Martin, a Columbia spokeswoman. She did not have an estimate of how many new jobs would be connected to the plan.

For some perspective, energy companies will extract an estimated 16.9 billion cubic feet of gas per day from the Utica and Marcellus this month, according to the Energy Information Administration. About 1.3 billion of the total will come from the Utica, which is still early in its development.

Industry leaders have said development of the Utica is constrained by a lack of pipeline and processing capacity, a problem that this project will help to address.

The Utica is a rock formation deep beneath the eastern part of Ohio and nearby states, containing oil, natural gas and natural-gas liquids such as ethane and propane. The Marcellus is shallower and covers much of the same territory, with rich gas deposits in Pennsylvania and West Virginia.

Companies have drilled 1,004 horizontal wells in the Utica, crossing the 1,000 mark in the past week, according to the Ohio Department of Natural Resources.

Related: Proposed 105-mile pipeline would bring more shale gas to region

Columbia Pipeline, a sister company of Columbia Gas of Ohio, hopes to obtain regulatory approvals and begin construction by the fall of 2016 and start operating the new system by the end of 2017.

The main regulator is the Federal Energy Regulatory Commission, which will do a review that typically lasts more than a year and will seek input from affected property owners, local governments and other interested parties. Columbia has already begun reaching out to people in the project’s path.

The most noticeable part of the plan will be a new pipeline that starts near Sugar Grove in the southeastern part of Fairfield County and runs across eastern Ohio and through the northern panhandle of West Virginia, stopping near the border with Pennsylvania.

The Sugar Grove starting point will connect to parts of the pipeline system that already are in place.

The company is also expanding its existing pipeline system to increase capacity and allow the gas to flow in two directions. This means Columbia would be able to ship gas from the Gulf Coast to Ohio, and vice versa.

The size, cost and gas capacity of the project are all notable, said Charles Fishman, a Morningstar analyst.

“That’s not small change for a pipeline,” he said.

Columbia Pipeline can make the investment because it has long-term agreements with energy producers to use the new pipeline, including Range Resources, Noble Energy, Kaiser Marketing Appalachian and American Energy Utica.

The $1.75 billion price tag makes this one of the largest of the roughly $20 billion worth of shale-related infrastructure projects announced in the state, according to a list compiled by Bricker & Eckler, a Columbus law firm.

Among the other natural-gas pipeline projects, DTE Energy, Spectra Energy and Enbridge Inc. have announced a plan to connect the Utica to Detroit and southern Ontario, with an estimated cost of up to $1.5 billion.

“There is just an incredible amount of money being spent in Ohio on the Utica,” said Glenn Krassen, an attorney for Bricker & Eckler.

NiSource, an Indiana-based company, is the parent of Columbia Pipeline and Columbia Gas.

“We have been a part of Ohio and West Virginia for more than 100 years and have an unparalleled footprint in the Marcellus and Utica production areas,” Glen Kettering, CEO of Columbia Pipeline Group, said in a statement. “These newly announced investments reaffirm our commitment to this important region and will increase the capacity and flexibility of the Columbia Transmission and Columbia Gulf systems to further enhance transportation options for producers in Appalachia.”


(c)2014 The Columbus Dispatch (Columbus, Ohio)

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This article was written by Dan Gearino from The Columbus Dispatch and was legally licensed through the NewsCred publisher network.

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