Dominion Energy Inc. said this week it agreed to buy Southern Co.'s stake in the roughly $8 billion Atlantic Coast natural gas pipeline from West Virginia to North Carolina, which is expected to enter service in early 2022.
If approved, that will bring Dominion's share in the pipeline to 53%, up from 48%. Duke Energy Corp. will own the remaining 47%. Southern will remain an anchor customer of the pipe through its Virginia Natural Gas subsidiary.
In addition, Dominion said it agreed to buy Southern's Pivotal LNG, which distributes LNG for marine and road transportation. The total cost of the Atlantic Coast stake and Pivotal was about $175 million, Dominion said.
Atlantic Coast, the nation's most expensive gas pipe, is one of several projects that have received federal permits in recent years but have been delayed by state opposition and local and environmental legal and regulatory battles.
Some analysts have questioned whether Dominion will be able to complete Atlantic Coast following numerous delays and cost increases related to regulatory and legal battles over state and federal permits.
Dominion CFO James Chapman told analysts on Feb. 11: "Major project customers have confirmed their willingness to take on higher project rates given the strategic importance of [Atlantic Coast] as an alternative pipeline option to the region."
Dominion CEO Thomas Farrell told analysts the company could restart pipeline construction after receiving some key permits that are expected during the first half of this year. The U.S. Supreme Court is expected to rule in May or June in a case about whether the pipeline can run underneath the Appalachian Trail in Virginia.
Drilled by the Pacific Khamsin rig to a depth of 33,348 feet, the well found about 200 ft of net oil pay with good reservoir characteristics in Paleogene sandstone.
Drillers cut 62 oil rigs in the week to April 3, bringing down the total count to 562, Baker Hughes Co. said in its weekly report.
Production at the offshore Liza well is expected to reach some 120,000 barrels per day in its first phase.