Drilling Down

Kinder Morgan Seeks Customers for $4B Pipeline

YOUNGSTOWN, Ohio – Kinder Morgan Inc. says it will “solicit commitments” from shippers for its proposed Utica Marcellus Texas Pipeline, which would transport natural gas liquids produced in the Utica and Marcellus shale plays to delivery points along the Texas Gulf Coast.

The official customer solicitation, known as a “binding open season,” was announced Thursday and begins Sept. 15. Kinder Morgan solicited customer commitments for the first time one year ago, according to Marcellus Drilling News.

The $4 billion Utica Marcellus Texas Pipeline will be designed to transport propane, butanes, natural gasoline, y-grade and condensate in batches along the system, with a maximum capacity of 430,000 barrels per day, the company said. Subject to shipper commitments and timely regulatory approvals, the pipeline is expected to be operating by the fourth quarter of 2018.

But before the Utica Marcellus Texas Pipeline can go online, Kinder Morgan has to abandon and convert to NGL transmission about 964 miles of the Tennessee Gas Pipeline System that extends from Mercer, Pa., through Columbiana and Carroll counties in Ohio to Louisiana. An 200-mile NGL pipeline must be from Natchitoches, La., to Mont Belvieu, Texas, and 120 of new laterals and interconnects must be built in Ohio, Pennsylvania, West Virginia, Tennessee, Kentucky and Mississippi.

New storage facilities also will have to be built in Ohio, the company said.

Tennessee Gas Pipeline Co. LLC, an affiliate of Kinder Morgan, said April 17 it plans to construct a compressor station in Mahoning County as part of its $412 million Abandonment and Capacity Restoration Project (READ STORY).

Notice of the company’s intent was filed with the Federal Energy Regulatory Commission. New compressor stations would also be built in Jackson, Morgan and Tuscarawas counties, the company said.

The proposed locations for the compressor stations were not disclosed in the document, only that “about 105.3 acres of land would be disturbed by the construction of new compressor stations” and that once in operations the facilities would operate on a “combined 60.3 acres.”

KMI is the largest energy infrastructure company in North America. It owns an interest in or operates approximately 84,000 miles of pipelines and 165 terminals. The company says it is Kinder Morgan is the largest midstream and third largest energy company in North America with an enterprise value of approximately $130 billion.

Published by The Business Journal, Youngstown, Ohio.