U.S. federal energy regulators on Oct. 5 approved a request by TransCanada Corp.’s (NYSE: TRP) Columbia Gas Transmission unit to put part of its $3 billion Mountaineer XPress natural gas pipeline project into service in West Virginia.
Mountaineer is one of several pipelines designed to connect growing output in the Marcellus and Utica shale basins in Pennsylvania, West Virginia and Ohio with customers in other parts of the United States and Canada.
Specifically, the U.S. Federal Energy Regulatory Commission (FERC) approved Columbia’s request to put Mountaineer’s Elk River compressor station into service.
The 2-billion cubic feet per day (Bcf/d) Mountaineer project is designed to increase gas capacity in West Virginia. The project includes construction of 170 miles of new pipeline in the state.
One billion cubic feet is enough gas to power about 5 million U.S. homes for a day.
New pipelines built to remove gas from the Marcellus and Utica basins have enabled shale drillers to boost output in the Appalachian region to a forecast record high of around 29.4 Bcf/d in October from 24.2 Bcf/d during the same month a year ago.
That represents about 36 percent of the nation’s total dry gas output of 81.1 Bcf/d expected on average in 2018. A decade ago, the Appalachia region produced just 1.6 Bcf/d, or 3% of the country’s total production in 2008.
In other news, TransCanada said on Oct. 5 that it placed the first Western phase of its WB XPress project into service. The Western phase is designed to move about 0.76 Bcf/d of gas from producers in Appalachia to consumers in the Gulf Coast.
The company said it plans to finish the second Eastern phase of the $900 million project by the end of the year.
TransCanada also said it plans to finish its $600 million Gulf XPress project by the end of the year. Gulf XPress is designed to move 0.88 Bcf/d of gas from Appalachia to the U.S. South.
One employee of a third party contractor involved in the work was injured in the explosion.
Completion of the Rover pipeline, which is being built to boost Marcellus and Utica shale gas production, is not expected to be delayed by a U.S. federal order to stop new drilling to install pipe, Energy Transfer said.
The Marcellus shale play is the “Beast in the East” that will disrupt supply and demand and gas prices, according to Andrew Bradford, Northeast team leader for Bentek Energy LLC, the Colorado-based midstream research and consulting firm. The play’s surging production and vast potential are changing the North American supply picture, with Appalachian Basin gas output set to double by 2014.