Natural Gas Pipeline Developments

Transcription

1 October 12, 2012 Framingham, MA Natural Gas Pipeline Developments Presentation to: A&WMA-NES Fall 2012 Conference Stephen Leahy Northeast Gas Association

2 Topics Pipeline trends in response to supply push Pipeline proposals New England pipeline connections

3 Continued on NGA web site

4 What is NGA? Non-profit trade association Local gas utilities (LDCs) serving New England, New York, and New Jersey Several interstate pipeline companies LNG importers (Distrigas, Repsol) and LNG trucking companies About 200 associate member companies, from industry suppliers and contractors to electric grid operators

5 U.S. Natural Gas Pipelines

6 Annual Growth in Pipeline Capacity, U.S. Source: U.S. EIA

7 Regional Pipeline Projects Completed and Installed in 2011 Tennessee s 300 Line Project Inergy s North-South project Spectra s TEMAX & TIME III Empire Pipeline s Tioga County Extension National Fuel Gas Supply, Line N Project Photo: National Fuel Gas Supply

8 BENTEK: Northeast Production Can Grow by 8.0 Bcf/d by 2017 Source: BENTEK Energy. Presented at NGA Market Forum, April 25, 2012.

9 Northeast Supply Dynamic: Transformation Traditionally, end of the pipeline ; long-haul transportation from Gulf Coast, western Canada High-priced region compared to national average Changes: Pipeline expansions recent and proposed LNG (several additions in region in ) Marcellus Shale volumes increasing Changing flow patterns displacing Gulf, Canada, Rockies Several pipelines in region now reversing flows to Canada, etc.

10 Gas Utility Service Areas Copyright: Northeast Gas Association Prepared by: Coler & Colantonio, Inc. 2011

11 PNGTS M&NE Iroquois Tennessee Algonquin 5 Interstate Pipelines Serve New England Copyright: Northeast Gas Association Prepared by: Coler & Colantonio, Inc. February 2012

12 4 LNG Import Facilities Serve New England NEWFOUNDLAND Locations approximate. Not all pipeline systems shown. Original map outline by FERC. QUEBEC 4 ONTARIO Distrigas, Everett, MA: 0.7 Bcf/d, 3.4 Bcf storage (GDF SUEZ ) 2. Northeast Gateway Project, Off Cape Ann, MA: 0.4 to 0.8 Bcf/d; no storage (Excelerate Energy) [in operation as of May 2008] 3. Neptune LNG, Off Cape Ann, MA: 0.4 Bcf/d ; no storage (GDF SUEZ) [in service as of summer 2010] 4. Canaport LNG, Saint John, NB: 0.75 to 1 Bcf/d, 9.9 Bcf of storage (Repsol, Irving Oil) [in operation as of 6-09] MARYLAND Prepared by Northeast Gas Association (NGA)

13 Opportunity for Market Growth in the Region Potential growth sectors 50% of Northeast homes heat with gas (35% in New England) CNG and LNG vehicles have potential, especially in heavy-duty market (e.g., fleet vehicles, refuse trucks) Gas combined-cycle plants remain leading choice (along with Renewables)

14 Growing Regional Interest Price, supply, environmental & efficiency advantages. CT draft energy strategy Maine Natural Gas Task Force Massachusetts reviewing potential gas opportunities. NJ s 2011 Energy Master Plan calls for residential expansion, especially to southern parts of the state. New York City s plans to phase out #4 and #6 oil and the impact on natural gas demand and infrastructure NYS DPS looking at existing natural gas franchise expansion policy statewide. VT Gas expansion project.

15 Lower Air Emissions In Feb., researchers at the Harvard School of Engineering and Applied Sciences (SEAS) reported that the primary explanation for the reduction in CO 2 emissions from power generation in the U.S. in 2009 was that a decrease in the price of natural gas reduced the industry s Source: FERC reliance on coal. 250, , , ,000 50,000 0 Electric Utility Emissions, MA, ,000,000 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 NOx SO2 CO2 Emissions, Electric Utilities, MA,

16 Shale Production Up, Price Down Source: U.S. EIA, 7-12 and 8-12

17 Proposed Projects: Appalachian Connections National Fuel, Line N 2012 & Line N 2013 National Fuel, Northern Access Project Tennessee, MPP Empire, Tioga County II Williams, Northeast Supply Link Williams & Cabot, Constitution Pipeline National Fuel, West to East Dominion, Appalachian Gateway [completed] Inergy, Marc I Prepared by NGA, based on publicly available information. Project locations approximate. As of Tennessee, Northeast Upgrade Tennessee, Northeast Supply Diversification VERMONT Tennessee, Northeast Expansion Millennium, Minisink & Hancock Compression Projects Spectra, AIM Spectra, NJ / NY Expansion Williams, Rockaway Lateral/Northeast Connector Spectra/Texas Eastern, TEAM 2012 & TEAM 2014

18 New England Challenge The initial Marcellus-related infrastructure build-out is not including New England There are some proposed New England-related projects, but still several years away and still requiring customer commitment to firm contracts Utility sector will more than likely step up for portion but what about the largest consuming sector in the region? Electric market does not seem to support generator investments in pipeline capacity.

19 Pipeline Expansion Process Source: U.S. EIA

20 High Utilization, Increasing Restrictions Source: U.S. EIA, Source: Tennessee Gas Pipeline, 9-12

21 Spectra s AIM Project

22 TGP s Northeast Expansion

23 Opportunities / Challenges Cleanest of all fossil fuels Higher efficiency Instrumental in reducing national and regional air emissions over recent years Abundant supply Price Siting Environmental concerns over fracking / fossil fuel Contract commitment to support infrastructure devl t

24 Thank you