TULSA, Okla.--(BUSINESS WIRE)--Williams Partners L.P. (NYSE: WPZ) today announced two major milestones in its strategy to create a major natural gas supply hub in northeastern Pennsylvania. Williams (NYSE: WMB) owns 72 percent of Williams Partners.
Williams Partners is announcing a new interstate gas pipeline joint venture with Cabot Oil & Gas Corporation (NYSE:COG). The new 120-mile Constitution Pipeline will connect Williams Partners’ gathering system in Susquehanna County, Pa., to the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in Schoharie County, NY. Williams Partners will own 75 percent of Constitution Pipeline and, through its affiliates, will provide construction, operation and maintenance services for the new pipeline. Cabot will own the remaining 25 percent.
The new pipeline will initially be designed to transport at least 500,000 dekatherms per day of Cabot’s Marcellus production, but will be expandable to meet growing demand for takeaway capacity in northeast Pennsylvania. See the information below about an open season to gauge additional shipper interest.
Constitution Pipeline will be regulated by the Federal Energy Regulatory Commission (FERC). Williams Partners expects to initiate the FERC application process soon.
Williams Partners also has completed the acquisition of the Laser Northeast Gathering System and other midstream businesses from Delphi Midstream Partners, LLC. The original acquisition along with additional pipeline construction was funded with $329 million in cash and approximately 7.5 million Williams Partners units.
Susquehanna Supply Hub
These two projects are key steps in Williams Partners’ strategy to create the Susquehanna Supply Hub, a major natural gas supply hub in northeastern Pennsylvania.
By 2015, Williams Partners expects the Susquehanna Supply Hub to be capable of delivering more than 3 billion cubic feet per day (Bcf/d) of Marcellus Shale production into four major interstate gas pipeline systems.
“We are developing all the key elements of a major new supply area hub, where we can provide Marcellus Shale producers in northeast Pennsylvania with a large-scale gathering system that has significant takeaway capacity to the best available markets,” said Alan Armstrong, chief executive officer of Williams Partners’ general partner. “It’s key to our strategy of providing large-scale infrastructure and continuing to build on our significant fee-based midstream and gas pipeline businesses.”
Williams Partners’ gathering system in northeastern Pennsylvania currently covers three counties and has a capacity of 750 million cubic feet per day (MMcf/d). With the recent start-up of the Springville pipeline, it is now connected to three major interstate gas pipeline systems – Williams Partners’ Transco system, Tennessee Gas Pipeline and Millennium Pipeline.
Constitution Pipeline Open Season
In addition to Cabot’s commitment as an anchor shipper on the new pipeline, an open season offering of firm transportation capacity will be held by Constitution Pipeline from today to March 12, 2012, to gauge any further shipper interest. Information on the open season can be found at www.williams.com/constitution.
For customer inquiries regarding Constitution Pipeline, contact Gary Duvall at (713) 251-2589.
About Williams Partners L.P. (NYSE: WPZ)
Williams Partners L.P. is a leading diversified master limited partnership focused on natural gas transportation; gathering, treating, and processing; storage; natural gas liquid (NGL) fractionation; and oil transportation. The partnership owns interests in three major interstate natural gas pipelines that, combined, deliver 14 percent of the natural gas consumed in the United States. The partnership’s gathering and processing assets include large-scale operations in the U.S. Rocky Mountains and both onshore and offshore along the Gulf of Mexico. Williams (NYSE: WMB) owns approximately 72 percent of Williams Partners, including the general-partner interest. More information is available at www.williamslp.com. Go to http://www.b2i.us/irpass.asp?BzID=1296&to=ea&s=0 or http://www.b2i.us/irpass.asp?BzID=630&to=ea&s=0 to join our email list.
Portions of this document may constitute “forward-looking statements” as defined by federal law. Although the partnership believes any such statements are based on reasonable assumptions, there is no assurance that actual outcomes will not be materially different. Any such statements are made in reliance on the “safe harbor” protections provided under the Private Securities Reform Act of 1995. Additional information about issues that could lead to material changes in performance is contained in the partnership’s annual reports filed with the Securities and Exchange Commission.