Williams Partners LP is facing yet another setback for a $3 billion pipeline project that would carry natural gas out of shale formations in the eastern U.S.
The Federal Energy Regulatory Commission said Thursday that it’ll give landowners until Nov. 14 to comment on new route alternatives for parts of Williams’s Atlantic Sunrise project in Pennsylvania. The agency had previously said it would issue a final environmental review of the line by Oct. 21.
Both Williams and Cabot Oil & Gas Corp., a would-be shipper on the line, slid on Thursday as the route evaluation raised questions about how soon the project would start. The nearly 200-mile (322-kilometer) extension to the Transco Pipeline system — which runs from the Gulf of Mexico to New York City — is designed to carry more supplies of the power-plant fuel out of the nation’s most prolific shale patch, where drillers are facing record low prices because of a lack of pipeline capacity.
The evaluation suggests a “potential delay” to the commission’s environmental review, Lance Latham, a spokesman for Williams, said in an e-mail Thursday. “We are in the process of evaluating any potential impacts to the project schedule.”
Williams has been expecting to receive final approval for the project in early 2017 so it could start service late that year. The company filed what it described as “minor route changes” in August after taking into account feedback from stakeholders.
It wouldn’t be the first setback for the pipeline. In a March 2015 application for the project, Williams asked the commission to issue a final order by April 29, 2016, so it could bring the system online in July 2017.
Cabot said in a statement that it expects the commission to issue an updated schedule for the environmental review. The company’s chief executive officer, Dan Dinges, said last month that he expected the agency to issue its final environmental approval “in the middle or latter part of October.” Cabot is the “foundation shipper” for the project, with 850 million cubic feet a day of capacity, Dinges said at the Barclays CEO Energy Conference.
A filing that the New York Public Service Commission made in April 2015 listed Chief Oil & Gas LLC, National Fuel Gas Co.’s Seneca Resources Corp. and a Southern Co. unit among the others who agreed to ship gas on Atlantic Sunrise. The companies weren’t immediately available for comment.
“This is adding uncertainty to the project,” Bloomberg Intelligence Analyst Brandon Barnes said by phone Thursday. “I don’t think this is material slippage yet.”