FERC approves Transco pipeline projects to increase NYC natural gas supply

Source:Williams Partners

The Transco pipeline is a major supplier of natural gas to New York City. Williams Partners' (NYSE:WPZ) and its wholly-owned subsidiary Transcontinental Gas Pipe Line Company, LLC (Transco) today announced that the Federal Energy Regulatory Commission (FERC) has approved its application to construct and operate two related projects designed to increase natural gas delivery capacity to Brooklyn and Queens in time for next winter's heating season.

The Transco pipeline is the nation's largest-volume interstate natural gas pipeline system; it is a major supplier of natural gas to New York City. Customers in a dozen states along the 1,800-mile pipeline route spanning South Texas to New York City receive natural gas shipped on the Transco system.

"Our execution on the Rockaway Lateral and Northeast Connector expansions underscore our broader corporate strategy to connect the best natural gas supplies with the best markets," said Rory Miller, senior vice president of Williams Partners' Atlantic-Gulf operating area. "We are committed to constructing and operating these projects in a timely, responsible, environmentally sensitive manner."

FERC on May 8 issued certificates granting approval of Transco's Rockaway Lateral and Northeast Connector expansions. Transco expects to begin full construction in June and bring the projects into service in the fourth quarter of 2014.

"After the brutal cold that drove several peak-day delivery records on the Transco system this past winter, we're pleased to move forward with this critical infrastructure to provide additional natural gas supply and increased reliability to New York City in time for next winter," said Miller. "FERC's decision supports our timeline, which we understand is a high-priority for New York City as it makes significant progress toward meeting clean-air goals. We expect residents and building owners who have upgraded to natural gas heating will continue to enjoy meaningful savings compared with heating oil."

This past winter was a record-setter for Transco, with peak-day delivery records on three separate occasions. On those days, the demand for natural gas deliveries on Transco's system was above and beyond the peaks that were attributed to the effect of the Polar Vortex and other brutal cold weather across all of the pipeline's market areas.

On Transco's Rockaway Lateral and Northeast Connector projects, Williams Partners plans to add 3.2 miles of new Transco pipeline and related facilities in New York, as well as equipment to increase compression at three existing Transco facilities in New Jersey and Pennsylvania. With a daily delivery capacity of 647,000 dekatherms, the Rockaway Lateral will provide an additional supply-delivery connection into the National Grid distribution system, which delivers natural gas to 1.25 million customers in Brooklyn and Queens.

The Rockaway Lateral and Northeast Connector are among some $5 billion of energy-infrastructure investments that Williams Partners expects to make in the Transco system over the 2013 to 2017 time frame to connect growing market demand with new natural gas supplies. Those expansions are designed to add more than 50 percent to Transco's capacity to deliver natural gas.

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