August 2023, Vol. 250, No. 8

Projects

Williams to Complete US Natural Gas Pipelines by 2024

Regulators Consider Permits for ‘Largest’ CO2 Pipeline  

(P&GJ) — Iowa regulators are about to begin hearings on granting permits for the country’s what is billed as designed to become the largest carbon pipeline in in the United States. 

The Summit Carbon Solutions proposed 2,000-mile system, currently drawn up to extend into five states, will be facing its first regulatory hurdle in its home state, in what is seen by analysts as a crucial test for the CCUS industry as a whole.

(Image: Summit Carbon Solutions)

The process itself is expected to last for months, with Summit hoping to have the $4.5 billion pipeline project operational in 2024. 

Opponents of the project have already begun criticizing the process, saying the Aug. 22 start date is too soon for them to hire lawyers or properly prepare testimony. 

Summit has signed more than 2,000 easements, agreements to pay fees to use property, with landowners along 475 miles of its 688-mile Iowa route, the company told Reuters. 


Williams to Complete US Natural Gas Pipelines by 2024 

Williams Cos is on track to complete natural gas pipeline projects in New Jersey and Louisiana by the end of 2024, CEO Alan Armstrong said during the recent Global Energy Transition conference. 

The first phase of the 830 MMcf/d Regional Energy Access (REA) expansion in New Jersey, Pennsylvania and Maryland would provide about half the project’s gas to customers in the fourth quarter of 2023. The second phase of the $1 billion REA is expected to enter service in late 2024. 

Armstrong told Reuters the company is also on target for completion of the Louisiana Energy Gateway project in Louisiana and Texas during the fourth quarter of 2024. 

Louisiana Energy Gateway will provide producers in the Haynesville shale in Arkansas, Louisiana and Texas with more access to the growing number of LNG export plants on the U.S. Gulf Coast. 

In 2022, Williams announced a non-binding agreement to take about 3 mtpa of capacity in Sempra Energy’s SRE.N Port Arthur LNG export plant in Texas. 

“There are still opportunities between us and Sempra but there are other opportunities that we have identified that will be announced ahead of anything with Sempra,” he told Reuters. 


Pinnacle Midstream to Double Midland Basin Processing Capacity 

Houston-based Pinnacle Midstream II reached a final investment decision (FID) to expand its operations in the gas-rich Midland Basin with the construction of a 220 MMcf/d natural gas processing plant.

(Photo: Pinnacle Midstream)

The addition of a second train at Pinnacle’s Dos Picos processing complex in Midland County, Texas, will double Pinnacle’s natural gas processing capacity in the basin to 440 MMcf/d, the company said. It aims to start commercial operation of the new facilities in the fourth quarter of 2024. 

In addition to the new processing unit, Pinnacle said it intends to expand gathering and compression facilities throughout Midland, Martin, and Glasscock counties to accommodate expected and future volumes. It did not provide details on specific growth plans beyond the processing addition.  

The company’s infrastructure is anchored by long-term acreage dedications with active Permian operators and designed for efficient expansions to support high-intensity pad development and increasing gas-oil ratio throughout the basin. 

Pinnacle founder and CEO J. Greg Sargent said the Dos Picos processing expansion “ensures we can provide the best service to our current and future customers, maximize their recoveries, and help limit flaring across the basin. 

The Train II facility will complement Pinnacle’s existing processing facilities and high-pressure, large diameter gathering and compression infrastructure that commenced operations during the first quarter of 2021. 

The company also provides multiple bi-directional and high-pressure third-party interconnects with peer companies within the region to maximize flow assurances for producers and third-party midstream customers, the company said. 

Pinnacle Midstream II is backed by Energy Spectrum Capital, a Dallas-based infrastructure firm that makes direct investments in companies that acquire, develop, and operate energy assets in North America.


US Buys 3 Million Barrels for Oil Stockpile, Plans for More 

The U.S. Department of Energy (DOE) awarded contracts to five companies for delivery of 3 million barrels of crude oil to the Strategic Petroleum Reserve (SPR) in August, at an average of $73 per barrel. 

In making the announcement, the DOE pointed out that the purchase price was lower than the average of $95 per barrel the SPR sold for in 2022, which is a “good deal for taxpayers.”  

The crude will be delivered to the Big Hill SPR site in Texas, the DOE said. The department added that it had launched a solicitation for another 3 million barrels for delivery to the stockpile’s Big Hill site in September. 

The Biden administration last year conducted the largest ever sale from the SPR of 180 million barrels, as a way to help stabilize rising oil markets and high gasoline pump prices in the wake of the war in Ukraine. 

The purchase plan was announced in May as the first step in refilling the emergency stockpile. 


Germany Welcomes Hydrogen Pipeline Project with Italy 

German Chancellor Olaf Scholz expressed his pleasure with the agreement between his country and Italy to go forward with the construction of a hydrogen-ready transmission pipeline. 

The new pipeline is expected to connect to the existing Trans-Mediterranean pipeline, which connects Italy with north Africa. 

“Strengthened cooperation on diversifying energy supply is very important for me,” he said, during news conference with Prime Minister Giorgia Meloni, of Italy. “Expanding supply networks in Europe will benefit us all and certainly increase energy security.”  

The 2,050-mile (3,300-km) project is headed up by four major European transmission system operators: Snam, Trans Austria Gasleitung (TAG), Gas Connect Austria (GCA) and bayernets in Germany. 

In May, Italy, Germany and Austria signed a letter of support for the development of a pipeline between North Africa and Europe, as European nations deal with fewer energy exports from Russia. 

Meloni said the project, in coordination with the EU Commission, will the two nations, along with Austria, to gain better access to green hydrogen. 


New Water Permit Brings MPV Closer to 2023 Completion 

The Mountain Valley Pipeline picked up an important water permit as it edges closer to restarting construction and potentially having the project in service prior to the end of the year. 

Court papers filed in the U.S. 4th Circuit by the partnership construction the pipeline showed environmental regulators in West Virginia issued the approval of a renewed Section 401 water quality certification for the West Virginia-to-Virginia pipe on June 8. 

Analysts at Height Capital Markets, an investment banking and research firm, told Reuters that language supporting Mountain Valley in the recently approved U.S. Fiscal Responsibility Act and issuance of the West Virginia permit “significantly raises the probability of a 2023 placed-in-service date” for the project. 

Mountain Valley said in the filing it anticipates the Army Corps of Engineers will issue a Section 404 water permit soon, as required by the Fiscal Responsibility Act. 

Mountain Valley is the only major gas pipeline under construction in Appalachia, which has been increasingly called on to supply natural gas for use in the production of LNG for exportation from the Gulf Coast.


Enbridge Foresees Woodfibre LNG Plant as Online in 2027 

Enbridge’s Woodfibre LNG project is projected to be in service in 2027, Cynthia Hansen, president of gas transmission and midstream told Reuters recently, with investments expected to be finalized soon. 

The project is underpinned by two long-term off-take agreements with a unit of oil major BP Plc for 15 years representing about 70% of the project’s capacity. 

Woodfibre, located about 34 miles (55 km) south of Vancouver, British Columbia, on the northwestern shoreline of Howe Sound, is nearing the 60% completion mark on engineering, which should allow major construction to start in September. 

Enbridge owns 30% of the $5.1 billion Woodfibre LNG project. The remaining 70% is owned by Pacific Energy, which is part of the Singapore-based RGE group of companies. 

Woodfibre is designed to produce about 2.1 mtpa of LNG, which is equivalent to about 280 MMcf/d of natural gas. 


DOE Refuses to Rehear Pipeline Operator’s Request for LNG Project 

The U.S. Department of Energy (DOE) rejected Energy Transfer’s request for a rehearing and a second extension of its Lake Charles LNG export project. 

The DOE said it was not convinced of the need for a second hearing on the matter, even though, in its earlier filings, the company said not receiving the extension would “likely result in a project’s demise.” 

Energy Transfer requested the extension, in part, because of a design variation, which would create a carbon capture and sequestration (CCS) component.  

Additionally, the company said the three-year extension was necessary due to unplanned delays and “severe shortages” of the type of equipment needed to build the Lake Charles project. 

The DOE said it would consider another application if Energy Transfer were unable to meet its export deadline in 2025. 

Energy Transfer, which said in its filling that the company had already spent $350 million on the export project, has not commented on the decision. 


Inactive North Dakota Oil Pipeline Sold to Native American Tribe  

A Native American tribe in North Dakota purchased an empty pipeline from Canadian pipeline operator Enbridge, in an effort to transport oil from wells on its reservation to the marketplace. 

The pipeline, which would link the tribe’s Fort Berthold Reservation oil facilities to Enbridge’s pipeline network, is expected to be in service within a year, the tribe said in a statement. Financial details were not disclosed. 

The California Department of Mineral Resources data shows that there are more than 2,600 operational oil and gas wells on the reservation, which in February generated an average of 144,190 barrels of oil per day, according to a report by Reuters. The reservation has the potential for 3,911 more oil and gas wells, the data showed.

The 31-mile pipeline passes near the Thunder Butte Petroleum subsidiary transloading and oil storage facility and can transport 15,000 bpd. 

The MHA Nation will be the first indigenous shipper on an Enbridge pipeline, the company told Reuters. 


Mexico’s CFE, ESENTIA Sign Memorandum for Gas Project 

The Comision Federal de Electricidad (CFE) has signed a $300 million deal with ESENTIA Energy Systems to develop natural gas infrastructure. 

The investment memorandum targets boosting existing pipelines, along with adding natural gas delivery points to serve CFE power plants and communities, the Mexican state power firm said. 

“The agreement will also allow both parties to put an end to various pre-existing legal disputes,” CFE said, in a written statement. 

ESENTIA, formerly known as Fermaca, was involved in a lengthy rift with Mexico’s government over natural gas pipeline contracts signed during the previous administration in 2019. 

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