Crestwood says strong demand for New England pipeline

HOUSTON — Crestwood Midstream Partners LP said it had seen strong early interest in a pipeline connecting its New England system to planned infrastructure in the region.

The Houston-based company said it had received natural gas commitments of 700 million cubic feet per day to be transported on a 30-mile pipeline linking to a system owned by its subsidiary, Central New York Oil & Gas Co.

The proposed line, called the MARC II,  would link the company’s existing infrastructure to the proposed PennEast Pipeline, a new interconnect on Transco’s Leidy Line, and Transco’s proposed Atlantic Sunrise Expansion Project, according to a Monday announcement.

New England has been a big destination for midstream investment thanks to a growing electricity and home heating market. Last winter, a shortage of natural gas sent prices soaring and threatened to interrupt the region’s electricity generation.

Related: Spectra Energy announces $3 billion New England project

Crestwood said commitments by natural gas shippers along the line were non-binding. The company expects to ask for binding shipment contracts in November, and projects its MARC II pipeline could begin flowing in late 2017.

“The MARC II Pipeline project will provide an important and cost-effective link between abundant regional supplies of natural gas in North Central Pennsylvania and growing demand in the Mid-Atlantic and New England markets,” said Heath Deneke, president of Crestwood’s natural gas unit in a statement.

The PennEast Pipeline, a $1 billion, 100-mile line developed by several partners under PennEast Pipeline Co. LLC, will run from the gas-rich Marcellus shale to southeast Pennsylvania and New Jersey. The pipeline is expected to begin construction in 2017 and will have a capacity of 1 billion cubic feet of gas per day.

More pipelines in New England: Kinder Morgan looks to Maine to fill proposed pipeline capacity

The Atlantic Sunrise Expansion Project, by the Williams Companies’ Williams Partners LP, will expand existing infrastructure and lay new pipe to add about 1.7 billion cubic feet of natural gas capacity running to the New England region. Williams already operates the Transco pipeline system which stretches about 10,200 miles from South Texas to New York City.

The Atlantic Sunrise expansion is expected to begin construction in 2016 and open for service in 2017 at a cost of about $2.1 billion.