Maritimes initiates $250 million expansion of Nova Scotia-US gas pipeline

By the OGJ Online Staff

HOUSTON, Feb. 4 -- Maritimes & Northeast Pipeline LLC applied to the Federal Energy Regulatory Commission for approval of the $250 million Phase IV expansion that will nearly double the capacity of its natural gas pipeline from offshore Nova Scotia to northeast US markets.

The proposed expansion would boost the pipeline's capacity to 800,000 decatherms/day from 415,000 decatherms/day, officials said.

Demand for natural gas, especially in New England and the Northeast, continues to increase at a rapid rate. Maritimes officials said they've received substantial requests for transportation services from local natural gas distribution companies, natural gas-fired electric generators and third-party marketers during recently completed open season nominations, emphasizing the market's desire for more natural gas from Atlantic Canada.

"The demand for natural gas is real, and it is significant," said Tom O'Connor, president of M&N Management Co., the managing member of Maritimes. "Maritimes is able to respond to the demand by efficiently and economically expanding its system to deliver new supplies of gas from fields off Canada's east coast. Access to additional sources of this cleaner-burning fuel will ensure greater energy reliability and flexibility for the northeast region."

Earlier this year, Maritimes signed agreements with PanCanadian Energy Services Inc. to transport up to 400 MMcf/d from PanCanadian's Deep Panuke project off Nova Scotia. The Phase IV expansion project will accommodate the increased volumes of gas.

Phase IV expansion also complements the planned Phase III extension of Maritimes pipeline from Methuen to Beverly, Mass. That extension will interconnect the 650-mile Maritimes pipeline with Algonquin Gas Transmission Co.'s 1,000-mile system through Algonquin's proposed HubLine project, officials said. Maritimes Phase III and Algonquin HubLine projects recently received final approval from FERC.

The Phase IV proposal involves construction of four compressor stations in Maine, each with some 26,800 hp additional compression; and 31.3 miles of additional pipeline loop facilities in Maine's Washington County.

"We will work closely with federal, state and municipal officials as well as landowners and stakeholders throughout the FERC process to ensure the project is designed and constructed with minimal impact to communities and the environment," said Bill Penney, senior vice-president and general manager of Maritimes.

Maritimes also will submit applications to other appropriate federal and state agencies, including the US Army Corps of Engineers, the US Environmental Protection Agency, Coastal Zone Management Commission, and Maine Department of Environmental Protection. The Phase IV expansion is expected to be in service in 2004.

Maritimes is owned by affiliates of Duke Energy Co., 37.5%; Westcoast Energy Inc., 37.5%; ExxonMobil Corp., 12.5%; and Emera Inc., 12.5%.