DALLAS, Texas - Energy Transfer Partners, L.P. (NYSE: ETP) on June 1 announced that construction has begun on the 175-mile Tiger Pipeline, an interstate natural gas pipeline to serve the Haynesville Shale and Bossier Sands producing regions in Louisiana and East Texas.
The 42-inch Tiger Pipeline will have an initial capacity of two billion cubic feet per day and is expected to be in service in the first quarter of 2011. Through a planned expansion project announced in February, and subject to FERC approval, the ultimate capacity of the Tiger Pipeline is expected to be 2.4 billion cubic feet per day, all of which is sold out under long-term contracts ranging from 10 to 15 years. Pending necessary regulatory approvals, the expansion is expected to be in service in the last half of 2011.
The Tiger Pipeline will originate in Panola County, Texas, and terminate in Richland Parish, La., interconnecting to seven interstate pipelines and one intrastate pipeline for ultimate delivery to markets across the Northeast, Southeast, Mid-Atlantic and Midwest.
Construction of the pipeline has been awarded to two contractors: Henkels & McCoy (78 miles) and Michels Corp. (97 miles). Pre-expansion project costs for the Tiger Pipeline are expected to be $1.095 billion, down nearly $70 million from previous estimates.
"The start of construction on the Tiger Pipeline marks an exciting achievement for us as we are on schedule and under budget," said Lee Hanse, senior vice president, Interstate Pipeline Division. "From a financial perspective the Tiger Pipeline will benefit our unitholders as it will provide significant distributable cash flow in 2011 and subsequent years."
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