Williams Partners seeks FERC OK for more natural gas service to Northeast

TULSA, Okla. - Williams Partners L.P. (NYSE: WPZ) announced on Dec. 14 that its Transco pipeline has filed an application with the Federal Energy Regulatory Commission (FERC) to provide 250,000 dekatherms per day of incremental, year-round firm natural gas transportation capacity to serve growing markets in the Northeast by November 2013.

The Northeast Supply Link project is designed to expand certain segments of the existing Transco pipeline in Pennsylvania and New Jersey to transport robust domestic supplies of natural gas to growing markets in the Northeast.

"Because of its existing location, the Transco pipeline is well positioned to connect vast domestic natural gas supplies with growing markets in New York, New Jersey and Pennsylvania," said Randy Barnard, president of Williams' natural gas pipeline business. "This increased access will not only enhance reliability of natural gas service, but should contribute to a more stable gas and electric pricing environment in markets served by the project."

The proposed expansion will primarily consist of approximately 12 miles of new pipe at various locations in Pennsylvania and New Jersey, in addition to a new 25,000-horsepower compressor facility in Essex County, N.J., along with other facility modifications. The capital cost of the project is estimated to be $341 million.

Most of the new pipe will be installed either entirely within or parallel to existing pipeline and utility rights-of-way. The new Essex County compressor facility will be constructed on land already owned by Williams. All other compression-related activities will be performed entirely within existing compressor station facilities.

If approved, compressor station construction would begin in November 2012 with pipeline construction following in the spring of 2013.

Williams Partners signs agreements with Hess, Chevron for Gulfstar FPS™

TULSA, Okla. - Williams Partners L.P. (NYSE: WPZ) announced on Oct. 25 that it has signed multiple agreements with Hess Corp. (NYSE: HES) and Chevron (NYSE: CVX) to provide production handling, export pipeline, oil and gas gathering and gas processing services in the Tubular Bells field development located in the eastern deepwater Gulf of Mexico.

Hess and Chevron, owners of the Tubular Bells leases, will utilize Williams Partners' proprietary floating production system, Gulfstar FPS™. Williams Partners expects Gulfstar FPS to be capable of serving as a central host facility for other deepwater prospects in the area.

A Letter of Award for the project was announced in a May 24, 2011, news release.

Williams Partners will design, construct and install its Gulfstar FPS with a capacity of 60,000 barrels of oil per day, up to 200 million cubic feet of natural gas per day (MMcf/d) and the capability to provide seawater injection services. The facility is a spar-based floating production system that utilizes traditional three-level topsides mated to a classic spar hull. This standard design approach will allow customers to reduce their cycle time from discovery to first oil.

From sanctioning the project to completion, Gulfstar FPS is expected to be delivered in 30 months.

"This agreement demonstrates the value that deepwater producers place on reducing cycle time and costs. It also reflects the commercial benefit of our reputation for reliability and our commitment to safety - both in our deployment of innovative solutions and in our operations. We are delivering a solution that has positive, meaningful bottom-line impact for producers," said Rory Miller, president of Williams Partners' midstream business.

This Gulfstar FPS will be the first spar-based floating production system with major components to be built entirely in the U.S. Gulf Coast area.

"This project will create approximately 1,000 U.S. jobs for 30 months," said Miller. "These jobs are spread from coast to coast across more than 20 states."

Williams Partners LP gets approval to expand Transco pipeline

TULSA, Okla. - Natural gas distributor Williams Partners L.P. has received regulatory approval to expand a pipeline to the Mid-Atlantic region of the U.S.

The company said on July 11 that the Federal Energy Regulatory Commission has approved expanding the pipeline to serve customers in Virginia and Maryland.

The expansion will add about 142,000 dekatherms of incremental firm natural gas capacity to Williams Partners' 10,000-mile Transco pipeline system. A dekatherm is a measurement of how much heat can be generated from natural gas. The Transco pipeline has a total capacity of 9.6 million decatherms per day, and carries gas throughout the northeastern and southeastern United States.

The project will connect with East Tennessee Natural Gas to provide fuel for power generation and local distribution customers, a Williams news release stated.

The company said it plans to have the expansion completed by November 2012.

The project will cost about $55 million and add about three miles of new pipeline and include the upgrade of compressor facilities in Virginia.

Williams Cos. Inc. is the general partner and holds the controlling interest in Williams Partners. Williams Partners has a Zacks #4 Rank (short-term Sell),

Williams Partners expanding in Marcellus Shale, buys Cabot assets

TULSA, Okla. - Williams Partners L.P. (NYSE: WPZ) announced on Nov. 18 that it is significantly expanding its midstream business in Pennsylvania's Marcellus Shale.

The partnership has agreed to acquire Cabot Oil & Gas Corp.'s midstream assets located in Susquehanna County, Pa., for $150 million. The Cabot assets include some 75 miles of gathering pipelines and two compressor stations. The transaction is expected to close during the fourth quarter.

In addition, Williams Partners has added more than $150 million of expansion capital to fund the 2011 construction phase of additional gathering assets, including compression and dehydration, which will significantly augment the acquired assets.

The partnership will continue to invest additional capital beyond 2011 to further expand the system. The combined gathering system will be capable of delivering approximately 1.2 billion cubic feet per day (Bcf/d) of natural gas over the next two to three years.

The new system will connect with Williams Partners' previously announced Springville gathering pipeline in Susquehanna County. It will significantly expand the Springville system, as well as add additional delivery points.

The partnership has also agreed to a new long-term dedicated gathering agreement with Cabot for its production in the northeast Pennsylvania area of the Marcellus Shale. The 25-year agreement covers an area of mutual interest that currently includes 138,000 gross acres.

"This additional expansion in the Marcellus Shale is an ideal growth opportunity for Williams Partners," said Alan Armstrong, senior vice president of Williams Partners' midstream business. "We have the opportunity to serve another one of the biggest producers in the Marcellus with the type of large-scale solutions required for Cabot's rapidly expanding production.

"The previously announced Springville system and this expansion will provide significant takeaway capacity to multiple interstate gas pipelines, including Transco," Armstrong said. "In addition to our anchor customer agreement with Cabot, there will be future opportunities to help third-party producers grow their volumes and access large natural gas markets. Included among those potential producer customers is Williams' exploration and production business, with its significant acreage position in northeast Pennsylvania."

The previously announced Springville system is currently in construction phase and is expected to be operational in mid-2011.

The Cabot assets being acquired are currently gathering approximately 230 million cubic feet per day (MMcf/d) of Cabot's natural gas production. Construction will begin on the additional expansions to the Springville system and other new areas in 2011.

Williams Partners applies to expand natural gas service to Southeast

TULSA, Okla. - Williams Partners L.P. (NYSE: WPZ) on Nov. 2 announced that it has filed an application with the Federal Energy Regulatory Commission (FERC) to expand its Transco natural gas pipeline by 225,000 dekatherms per day to serve markets in the Southeastern U.S.

New service from the Mid-South Expansion project would be available in two phases, subject to FERC approval.

Phase 1 would increase capacity by 95,000 dekatherms per day by the fall of 2012, while Phase II would increase capacity by 130,000 dekatherms per day by the summer of 2013.

Demand for natural gas in the Southeastern U.S. is growing at a rate more than twice the national average.

The Mid-South Expansion project is designed to transport natural gas from Transco's Station 85 pool to new and existing power generation and municipal facilities in the Southeast.

"This filing is an important milestone in our efforts to meet our customers' growing needs for natural gas in the Southeast," said Phil Wright, president of Williams' natural gas pipeline business. "We look forward to continuing to work with all stakeholders to successfully implement this project."

Williams Partners completes Phase One of Transco expansion

TULSA, Okla. - Williams Partners L.P. said on July 12 that it began operating the first part of a pipeline expansion designed to increase natural gas shipments to the Southeast.
The company said the first phase of its Transco pipeline expansion provides natural gas to a Constellation Energy power plant in Tallapoosa County, Ala. The next phase will send gas to new and existing power plants in North Carolina.
The company estimates the cost of the project at $241 million.

Williams announces $12 billion revamp plan for pipeline affiliates

NEW YORK - Shares of natural-gas producer and pipeline firm Williams Cos. rallied on Jan. 19 after it said before the stock market opened that it would restructure its affiliates in a series of transactions that it valued at a combined $12 billion.
At day’s end, Williams Cos. Inc. (NYSE: WMB) closed up $1.73 per share at $23.10 per share (up 8.10 percent). Williams Partners LP (NYSE: WPZ) closed up $5.60 per share at $36.39 (up 18.19 percent), and Williams Pipeline Partners LP (NYSE: WMZ) closed up $3.84 at $27.19 (up 16.45 percent).
Williams said it plans to contribute its gas pipeline business and domestic distribution system and its limited and general partner interests in Williams Pipeline Partners into Williams Partners LP.
After the transactions, Williams Pipeline Partners will no longer be publicly traded.
"The restructuring is intended to drive additional growth and value for Williams' shareholders and Williams Partners' unitholders," Williams said.
"The moves will result in two well-capitalized entities that are better positioned to pursue value-adding growth strategies; both expect to have investment-grade credit ratings."
As part of the deal, Williams will purchase $3 billion of its corporate debt from the $3.5 billion in cash it will receive from Williams Partners. That cash, plus the value of 203 million Williams Partners units and $2 billion in assumed debt comprise the bulk of the $12 billion value for the deal.
Williams Partners will boost its regular quarterly distribution by 3.5 percent per LP unit to 65.8 cents from 63.5 cents starting with the first quarter.
Williams Partners will offer a fixed exchange ratio of 0.7584 of its common units for each Williams Pipeline Partners common unit. The exchange values Williams Pipeline Partners at $23.35 a unit, flat with its closing price on Jan. 15.