NiSource, XTO Energy building $150 million gas line in Pennsylvania

NiSource Gas Transmission and Storage on April 5 announced a partnership with Texas-based XTO Energy to build a 70-mile natural gas pipeline across Southwestern Pennsylvania.

The line will serve as a gathering system for Marcellus shale wells in Butler, Armstrong, Allegheny, Indiana and Westmoreland counties.

Construction of the pipeline has started in the Alle-Kiski Valley.

The $150 million pipeline project, formerly known as the Lancer Line, has been renamed the Big Pine Gathering System.

NiSource plans to replace a dormant 55-mile, 10-inch Buckeye pipeline with a combination 20- or 24-inch high pressure line. The company will lay new pipe to extend the line on both ends of the former Buckeye line.

"(XTO), along with other producers in the area, will now have the capacity and access to markets needed in this burgeoning shale gas development play in Western Pennsylvania by the end of the year," Jimmy Staton, NiSource executive vice president, said in a written statement.

The system is expected to provide an initial capacity of about 425 million cubic feet of natural gas per day.

NiSource, which owns Columbia Gas Transmission, parent company of Columbia Gas of Pennsylvania, plans to connect the pipeline with its own transmission line as well as Texas Eastern Transmission and Dominion Transmission lines.

Energy Transfer announce results of Southern Union merger elections

Energy Transfer Equity (NYSE: ETE) and Southern Union Co. (NYSE: SUG) on March 20 announced preliminary results of the elections made by Southern Union stockholders regarding their preferences as to the form of merger consideration they will receive in connection with Southern Union’s pending merger with ETE, which is currently expected to be completed on or about March 26, 2012.

Under the terms of the Second Amended and Restated Agreement and Plan of Merger, dated July 19, 2011, as amended, among Southern Union, ETE and Sigma Acquisition Corp., a wholly-owned subsidiary of ETE, Southern Union stockholders could elect to exchange each outstanding share of Southern Union common stock for $44.25 of cash or 1.00x ETE common unit, with no more than 60 percent of the aggregate merger consideration payable in cash and no more than 50 percent of the aggregate merger consideration payable in ETE common units. Elections in excess of either the cash or common unit limits will be subject to proration.

Based on available information as of the election deadline on March 19, 2012, the preliminary merger consideration election results were as follows:

* Holders of approximately 55 percent of outstanding Southern Union shares, or 68,644,424 Southern Union shares, elected to receive cash. This includes 15,522,372 shares subject to guaranteed delivery procedures.

* Holders of approximately 45 percent of outstanding Southern Union shares, or 56,212,227 Southern Union shares, will receive ETE common units. This amount is comprised of 38,973,314 Southern Union shares for which holders elected to receive ETE common units (which includes 4,350,144 shares subject to guaranteed delivery procedures), and 17,238,913 Southern Union shares for which holders either did not make an election or did not deliver a valid election form prior to the election deadline and, therefore, will be deemed to have elected to receive ETE common units.

Elections made pursuant to the notice of guaranteed delivery procedure require the delivery of Southern Union shares to Computershare Trust Company, N.A., the exchange agent for the merger, by March 22, 2012. If the exchange agent does not receive the required stock certificates or book-entry transfer of shares by the guaranteed delivery deadline, the Southern Union shares subject to such elections will be treated as shares deemed to have made an election for ETE common units.

After the final results of the merger consideration election process are determined, the final allocation of the merger consideration will be calculated in accordance with the terms of the Merger Agreement.

Williams Partners notes progress on natural gas supply hub in Pennsylvania

TULSA, Okla. - Williams Partners L.P. (NYSE: WPZ) on Feb. 21 announced two major milestones in its strategy to create a major natural gas supply hub in northeastern Pennsylvania.

Williams (NYSE: WMB) owns 72 percent of Williams Partners.

The new 120-mile Constitution Pipeline will connect Williams Partners' gathering system in Susquehanna County, Pa., to the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in Schoharie County, NY. Williams Partners will own 75 percent of Constitution Pipeline and, through its affiliates, will provide construction, operation and maintenance services for the new pipeline. Cabot will own the remaining 25 percent.

The new pipeline will initially be designed to transport at least 500,000 dekatherms per day of Cabot's Marcellus production, but will be expandable to meet growing demand for takeaway capacity in northeast Pennsylvania.

Constitution Pipeline will be regulated by the Federal Energy Regulatory Commission (FERC). Williams Partners expects to initiate the FERC application process soon.

Williams Partners also has completed the acquisition of the Laser Northeast Gathering System and other midstream businesses from Delphi Midstream Partners, LLC. The original acquisition along with additional pipeline construction was funded with $329 million in cash and approximately 7.5 million Williams Partners units.

These two projects are key steps in Williams Partners' strategy to create the Susquehanna Supply Hub, a major natural gas supply hub in northeastern Pennsylvania.

By 2015, Williams Partners expects the Susquehanna Supply Hub to be capable of delivering more than three billion cubic feet per day (Bcf/d) of Marcellus Shale production into four major interstate gas pipeline systems.

"We are developing all the key elements of a major new supply area hub, where we can provide Marcellus Shale producers in northeast Pennsylvania with a large-scale gathering system that has significant takeaway capacity to the best available markets," said Alan Armstrong, chief executive officer of Williams Partners' general partner. "It's key to our strategy of providing large-scale infrastructure and continuing to build on our significant fee-based midstream and gas pipeline businesses."

Williams Partners' gathering system in northeastern Pennsylvania currently covers three counties and has a capacity of 750 million cubic feet per day (MMcf/d). With the recent start-up of the Springville pipeline, it is now connected to three major interstate gas pipeline systems - Williams Partners' Transco system, Tennessee Gas Pipeline and Millennium Pipeline.

Maine Natural Gas proposes new gas pipeline to Augusta

NEW GLOUCESTER, Me. - Maine Natural Gas (MNG) has begun discussions with potential large customers for the development of a natural gas distribution system to serve Augusta, Me.

Maine Natural Gas is a subsidiary of Iberdrola USA, which is also the parent company of Central Maine Power.

"This is a great opportunity to provide new energy options for homes and businesses in the Augusta region," said Bob Kump, CEO of Iberdrola USA. "As with our $1.4 billion investment in Central Maine Power's electrical system, the proposed project is further proof of Iberdrola's commitment to improving Maine's energy infrastructure and helping to lower energy costs for Maine consumers."

Depending on discussions with potential customers, MNG will apply for state and local permits this spring, and hopes to begin the first phase of construction this year.

The first phase of the project would serve customers on the city's east side.

The line will tap into an existing interstate pipeline in Windsor and run approximately 10 miles along Route 17 to Route 9.

MNG's plans include a second phase of construction that would cross the Kennebec and extend along Western Avenue and the Leighton Road to the North Augusta commercial area in 2013.

The line will have sufficient capacity for expansion into the surrounding residential areas as well. Following recent expansions to Freeport and Bath, the service to Augusta will be the third expansion of the MNG franchise since 2010.

Spectra Energy secures two shippers for Texas Eastern expansion

HOUSTON, Texas - Spectra Energy Corp.'s Texas Eastern Transmission, LP on Jan. 17 announced it has reached binding agreements with two anchor shippers for its TEAM 2014 project, an expansion of its existing Texas Eastern system to deliver additional emerging Appalachian shale natural gas supplies to diverse markets in the Northeast, Midwest and Southern U.S.

The commitments provide sufficient market support to proceed with the development of the TEAM 2014 project. Texas Eastern will solicit interest from additional shippers through a binding open season that began on Jan. 17 and will end Feb. 17.

TEAM 2014, with an estimated fourth quarter 2014 in-service date, reflects a fully scalable capacity expansion of up to 1.4 billion cubic feet per day, including the volume of the two anchor shippers. Because Texas Eastern is expanding its existing pipeline system, the expansion project can be sized to meet the needs of the two anchor shippers as well as additional shippers that may be identified during the binding open season.

The company currently estimates the expansion will result in a capital investment of approximately $500 million, which could potentially increase based on the results of the open season.

Interested shippers will have the opportunity to nominate transportation services from multiple existing and proposed receipt points in West Virginia and southwestern Pennsylvania to multiple delivery points across the Northeast, Midwest and Southeast U.S. markets.