HOUSTON--(BUSINESS WIRE)--Kinder Morgan, Inc. (NYSE: KMI) today announced that its subsidiary,
Tennessee Gas Pipeline Company (TGP), has finalized its anchor shippers
for the market path component of the proposed Northeast Energy Direct
Project (NED) following the formal close of the anchor shipper period in
February. Collectively, the anchor shippers have executed agreements to
transport approximately 500,000 dekatherms per day (Dth/d) of
incremental natural gas supplies sourced from the prolific Marcellus
Shale region to meet New England’s growing consumer and industrial gas
needs, as well as helping to bolster electric reliability. NED’s market
path component, from Wright, New York, to Dracut, Massachusetts, and
beyond, is scalable to 1.2 billion cubic feet per day (Bcf/d), or
ultimately 2.2 Bcf/d. A project in-service date of November 2018 is
planned.
Anchor shippers that have executed binding precedent agreements include:
National Grid, 186,963 Dth/d; Liberty Utilities, 115,000 Dth/d; Columbia
Gas of Massachusetts, 114,300 Dth/d; and Connecticut Natural Gas
Corporation, Southern Connecticut Gas Corporation, The Berkshire Gas
Company, The City of Westfield Gas & Electric Light Department and
others. TGP is continuing to negotiate with potential shippers on the
NED Project, including electric distribution companies (EDCs) and
others, and expects to announce additional commitments at a later date.
“We are pleased that a broad range of New England market participants
have declared, through binding contractual commitments, the clear need
for an expansion of TGP to provide a transformative solution to reduce
energy costs and enhance gas and electric reliability in New England,”
said KMI East Region Natural Gas Pipelines President Kimberly S. Watson.
“Together with our shippers, we have worked hard to develop a regional
solution that is a win-win for New England. Securing anchor shippers
provides an important foundation for the successful development of the
NED Project.”
Through these commitments to the NED Project, the regional gas utilities
in New England are expanding long-standing relationships with Kinder
Morgan to serve their growing markets. TGP has provided safe and
reliable interstate gas pipeline gas to the New England region for over
60 years and is committed to working with its partners and customers to
meet the regional energy needs and challenges, and also taking advantage
of the opportunities available through increased access to growing and
robust natural gas production.
Kinder Morgan remains keenly aware of the effect that pipeline
constraints have on electric prices and reliability in the region and
has been actively involved in working to develop a regional solution.
According to ISO New England, New Englanders paid an additional
$3 billion in electricity costs in the winter of 2013/2014 due to
natural gas capacity shortages.
Building on the project’s success being announced today, discussions and
efforts are progressing well with gas and electric utilities to work
together with Kinder Morgan and other key stakeholders, including
regulators and government officials, to address regional issues. Some of
these efforts involve a model where EDCs may sign up for pipeline
capacity to add gas capacity for power generation in the region. These
potential contracts are not yet reflected in the commitments that have
been made for the NED Project.
The NED Project brings abundant, low-cost and critically needed
incremental regional natural gas supplies to the heart of New England,
bypassing infrastructure bottlenecks that result in high energy costs to
residents in the region, and it stands to reduce the environmental
impacts of burning fuel oil and coal. It provides the potential for gas
service to markets where it is unavailable today and for the expansion
of local gas service and increased supply options to other pipelines in
the region. The project has the ability to provide the necessary volumes
needed for EDCs throughout New England.
TGP has over 5,000 megawatts of natural gas-fired generation assets
attached to its system, and supplies over 1 Bcf/d of natural gas
critical to other intra-regional systems, such as Algonquin Gas
Transmission. The NED Project expands TGP’s role as supplier to such
systems. By designing the NED Project’s market path to be approximately
90 percent co-located along existing utility corridors, it significantly
minimizes the project’s environmental impacts.
“It is universally recognized that New England needs at least 2 Bcf/d of
pipeline capacity to transport additional natural gas supplies to allow
local gas companies to continue to serve their customers, to help New
England’s natural gas-fired power generation fleet to supply energy
reliably and economically, and to help support economic development and
jobs within the region,” said Watson. “We applaud the efforts of the
electric distribution companies and their proposed EDC model in solving
the region’s energy challenges. We also commend the Baker-Polito
Administration for directing the opening of a docket for options to
expand natural gas capacity in Massachusetts and for the
administration’s coordination with other leaders of New England states
to work together towards comprehensive energy solutions for the region.
By leveraging off its unique access to low-cost natural gas supplies in
northeast Pennsylvania, the NED Project will make gas supply and
capacity available to new and existing markets in New England. Kinder
Morgan is providing the transformative energy solution that the New
England region needs.”
Kinder Morgan, Inc. (NYSE: KMI) is the largest energy infrastructure
company in North America. It owns an interest in or operates
approximately 80,000 miles of pipelines and 180 terminals. The company’s
pipelines transport natural gas, gasoline, crude oil, CO2 and
other products, and its terminals store petroleum products and
chemicals, and handle bulk materials like coal and petroleum coke.
Kinder Morgan is the largest midstream and third largest energy company
in North America with an enterprise value of approximately $130 billion.
For more information please visit www.kindermorgan.com.
This news release includes forward-looking statements. These
forward-looking statements are subject to risks and uncertainties and
are based on the beliefs and assumptions of management, based on
information currently available to them. Although Kinder Morgan
believes that these forward-looking statements are based on reasonable
assumptions, it can give no assurance that such assumptions will
materialize. Important factors that could cause actual results to
differ materially from those in the forward-looking statements herein
include those enumerated in Kinder Morgan’s reports filed with the
Securities and Exchange Commission. Forward-looking statements
speak only as of the date they were made, and except to the extent
required by law, Kinder Morgan undertakes no obligation to update or
review any forward-looking statement because of new information, future
events or other factors. Because of these uncertainties, readers
should not place undue reliance on these forward-looking statements.