Rockies Express Pipeline LLC (REX) announced several significant financial and commercial developments. Developments include the commissioning of all of the compressor units on its Seneca Lateral; approval from the Federal Energy Regulatory Commission (FERC) for construction of facilities in Zone 3 of the REX mainline; and the launch of a binding open season for capacity on Zone 3.
REX commissioned all of the compressor units of the Seneca Lateral in Noble County, Ohio, increasing the available capacity to the design limit of about 600 million cubic feet per day (MMcf/d). All of the additional capacity is contracted with a weighted average contract life of about 14 years.
REX also received FERC approval for its application to modify, build and operate certain facilities to create an additional 1,200 MMcf/d of east-to-west flow of gas in Zone 3 of the REX mainline from Monroe County, Ohio, to the existing NGPL delivery interconnect in Moultrie County, Ill. The Zone 3 East-to-West project’s capacity of about 1,200 MMcf/d within Zone 3 is fully contracted for a weighted average life of 20 years, and is in addition to the 600 MMcf/d of east-to-west capacity served through the Seneca Lateral and Zone 3 mainline. REX is awaiting receipt of the project’s final notice to proceed from FERC and expects that the project will enter service sometime during the second half of 2015. When the project is placed into service, REX will have the ability to flow 1,800 MMcf/d of gas in either direction in Zone 3.
Finally, REX announced its intention to launch a binding open season for up to an additional 800 MMcf/d of east–to-west capacity within Zone 3. The additional capacity will be accomplished primarily through modification of existing pipeline facilities. Specifically, REX plans to construct three compressor stations and install additional compressors at an existing station. The project will not require additional pipeline. The project is underwritten by binding precedent agreements for 700 MMcf/d with a weighted average life of 15 years. Subject to receipt of required regulatory approvals, the project is expected to enter service during the second half of 2016, giving portions of Zone 3 up to 2,600 MMcf/d of east-to-west capacity.
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