(Reuters) – EQM Midstream Partners LP said it had raised the estimated cost of its Mountain Valley natural gas pipeline from West Virginia to Virginia to $4.8-$5.0 billion and delayed the projected completion to mid-2020 due to ongoing legal and regulatory challenges.That is up from the company’s last estimate of $4.6 billion and a target to complete the project in the fourth quarter of 2019.
EQM made the comments in a federal regulatory filing in which the company said it had submitted a land exchange proposal to the federal government in an effort to enable the pipe to cross the Appalachian Trail.
Crossing the trail became an issue after the U.S. Court of Appeals for the 4th Circuit in December said the U.S. Forest Service lacked authority to issue a permit for another gas pipe, Dominion Energy’s $7 billion to 7.5 billion Atlantic Coast, to cross the Appalachian Trail on federal land. That case is on appeal to the U.S. Supreme Court.
EQM’s land exchange proposal would grant the federal government full ownership of private lands crossed by the Appalachian Trail, including certain private land located adjacent to the Jefferson National Forest.
In exchange, the government would grant Mountain Valley a right-of-way to cross the trail using the pipeline‘s previously planned underground method at an existing crossing location approved by FERC in 2017.
The 303-mile (488-km) pipeline is designed to deliver 2 Bcf/d of gas.Read more
Source Article: PG&J
SAN RAMON, Calif. (AP) — Chevron will buy Anadarko Petroleum for $33 billion in a cash-and-stock deal as the company seeks to grow stronger in deep water exploration in the gulf and the energy-rich southwest region of Texas called the Permian Basin.
The companies put the enterprise value of the deal at $50 billion. The deal, announced Friday, arrives with U.S. crude prices up 40% this year.
“This transaction builds strength on strength for Chevron,” said Chairman and CEO Michael Wirth. “The combination of Anadarko’s premier, high-quality assets with our advantaged portfolio strengthens our leading position in the Permian, builds on our deep water Gulf of Mexico capabilities and will grow our LNG business.”
With the deal announced Friday, it gets access to Anadarko’s LNG operations in Mozambique. The combined company will also control a 75-mile-wide corridor across the Delaware Basin, just beside the Permian Basin, a region bountiful with natural gas that has been exploited through shale drilling.
There has been some pressure in energy markets as OPEC tries to push prices higher through production cuts.
When the organization of oil-producing states released its monthly report this week, it revealed that energy output from OPEC had declined to levels not seen since early 2015.
That is largely being driven by the energy powerhouse Saudi Arabia, which last month removed another 324,000 bpd from the market.
Still, U.S. crude was selling for less than $65 per barrel Friday. That’s far from levels well above $100 per barrel reached just before the economic downturn in 2008, and there are signals that global economic growth is slowing.
The acquisition of Anadarko could give Chevron a little more breathing room when crude prices do fall.
With savings the companies plan to book and rising cash flow, Chevron said it will bump up annual stock buybacks to $5 billion, from $4 billion a year, once the transaction is complete.
Chevron plans to divest $15 billion to $20 billion of assets between 2020 and 2022, with proceeds being used to lower debt and to return additional cash to shareholders, the company said.
Anadarko shareholders will receive 0.3869 shares of Chevron and $16.25 in cash for each share they own, or $65 per share. Chevron will issue about 200 million shares and pay approximately $8 billion in cash. It will also assume about $15 billion in debt.
Chevron Corp. will keep its headquarters in San Ramon, California. Anadarko Petroleum Corp. is based in The Woodlands, Texas.
The deal is expected to close in the second half of the year. It still needs approval from Anadarko Petroleum Corp. shareholders and regulators.
Shares of Anadarko jumped 30.3% before the market opened, while Chevron’s stock fell 3.2%.Read more
Trump Signs Orders to Ease Pipeline Approval, Construction
CROSBY, Texas (P&GJ) – President Donald Trump on Wednesday signed a pair of executive orders intended to ease permitting and construction of pipelines and other energy infrastructure – an action that quickly drew the praise of industry organizations.
One of the orders directs Environmental Protection Agency (EPA) Administrator Andrew Wheeler to review the agency’s permitting process to speed up the construction of natural gas pipelines. It specifically directs EPA staff to review regulatory language that gives authority to states under the federal Clean Water Act (CWA), which has been used by New York regulators to block the construction of pipelines to transport natural gas from the nearby Marcellus and Utica basins.
Another order, intended to streamline approval of cross-border pipelines, clarifies that the President will make the decision on whether to issue permits for such projects. Currently, the Secretary of State has the authority to issue permits for such cross-border projects as the proposed Keystone XL pipeline, which would extend from Hardisty, Alberta, to Steele City, Nebraska.
Trump timed the executive orders Wednesday with a fund-raising trip to Texas, where he spoke at the International Union of Operating Engineers International Training and Education Center in Crosby, northeast of Houston. The orders are part of a broader initiative to achieve a goal that the Trump Administration refers to as global “energy dominance.”
After arriving in Crosby, he told a crowd of about 300 people that the “era of job-killing regulations is over.” [Read full text of President Trump’s remarks in Crosby]
The Interstate Natural Gas Association of America (INGAA) and the American Gas Association (AGA) were among organizations that responded with praise for the actions on behalf of the industry.
“Currently, the process for reviewing and approving new or expanded interstate natural gas pipelines is robust and transparent – two things that we continue to believe are essential – but procedural inefficiencies can delay a process that already spans several years,” said Don Santa, president and CEO of INGAA, in a statement. “Streamlining the process to ensure it is safe, comprehensive and predictable is a top priority, along with EPA clarifying Clean Water Act section 401 water quality certification requirements so that one state cannot interfere with interstate commerce.
“We look forward to learning more about the administration’s plans to expedite the permitting and review process for the critical infrastructure that allows Americans to continue enjoying the many benefits of natural gas,” Santa said.
AGA President and CEO Karen Harbert said Trump’s executive orders “clear the way for development of new natural gas pipelines, enabling greater access to natural gas thereby benefitting American families and our environment.”
America’s natural gas utilities add an average of one new customer every minute nationwide servicing the millions of Americans who want access to gas, the AGA noted in Harbert’s statement Wednesday. The association, which represents many of the nation’s local distribution companies (LDC), also cited a recent study from the National Bureau of Economic Research found that the drop in natural gas prices averted 11,000 winter deaths per year in the U.S.
“When states say ‘no’ to the development of natural gas pipelines, they force utilities to curb safe and affordable service and refuse access to new customers including new businesses. Limiting access and choice for Americans – driving up costs and emissions in the process – is simply bad policy,” Harbert said.
INGAA’s Santa added, ““We are pleased that the administration is building upon earlier actions to streamline the permitting and review process for critical energy infrastructure projects. Ensuring that our abundant domestic supply of natural gas can safely reach end users is critical if we are to fully realize the benefits of this clean-burning, job-creating resource and natural gas infrastructure is the foundation of that vision.
According to AGA, increased use of natural gas has led to U.S. energy-related carbon dioxide emissions hitting 25-year lows. The association said public policy at every level should recognize the role that the direct use of natural gas will continue to play in reducing greenhouse gas emissions.
“Americans deserve a choice when it comes to their energy and enabling the development of natural gas pipelines gives them an opportunity to choose reliability, affordability and a clean energy future,” Harbert said.
In addition to the EPA directives, Trump also instructed the departments of Transportation, Agriculture, Commerce and Interior to review ways to ease LNG transport by rail and LNG’s ability to build electric power lines across private land.
A group of business organizations submitted a letter to EPA Administer Wheeler last week alleging that states have been using the CWA’s environmental review and permitting process for energy projects as an activist tool to oppose production and use of fossil fuels. The Trump administration, however, has emphasized that its goal is to ensure states follow the intent of the CWA and not to take power away from them.
Trump issued a new presidential permit for the Keystone XL last month, two years after he first approved it and more than a decade after it was first proposed.Read more
President Donald J. Trump issued an updated presidential permit for the proposed Keystone XL crude oil pipeline on Mar. 29. The move was seen as an attempt to jump-start the project’s construction after a federal judge in Montana blocked it in November and ordered further environmental reviews (OGJ Online, Nov. 9, 2018). US District Judge Brian Morris modified, but did not rescind, his order a few months later (OGJ Online, Feb. 18, 2019).
“This permit acknowledges the project’s importance to the White House once again, and the steps TransCanada Corp., the project’s sponsor, has taken over the years,” a Washington energy observer said. “But there is an injunction still in place which halts construction. The steps from here regarding that injunction depend on what steps the US Department of Justice and TransCanada want to take.”
Business and labor organizations welcomed the president’s action. “The Keystone XL pipeline is one of the most studied pieces of infrastructure in American history. Over the course of a decade, it has been through five environmental reviews on the main route and an additional two on an alternative route,” said Christopher Guith, acting president of the US Chamber of Commerce’s Global Energy Institute.Read more
HOUSTON – PG&J source article
Noble Midstream announced it has secured a $200 million equity commitment (“Preferred Equity”) from Global Infrastructure Partners Capital Solutions Fund (“GIP”) to fund capital contributions to Dos Rios Crude Intermediate LLC, a newly-formed subsidiary holding Noble Midstream’s 30% equity interest in the EPIC Crude Pipeline.
The 30-inch EPIC Crude Pipeline is being designed with an initial capacity of 590 MBbl/d from the Permian Basin and Eagle Ford to the Gulf Coast. With the installation of additional pumps and storage, EPIC can increase the 30-inch capacity to approximately 900 MBbl/d. Interim service remains on track for startup in the third quarter of 2019 and permanent service is anticipated in January of 2020.
Commenting on the announcement, John Bookout, Chief Financial Officer, said, “We look forward to having GIP as our partner given their extensive energy investing track record and believe this transaction is a further endorsement of our investment in the EPIC Crude Pipeline. This Preferred Equity provides an attractive funding source for the Partnership, allowing us to maintain a prudent balance sheet without issuing common equity as the EPIC Crude Pipeline progresses. We are excited to capitalize on the growing demand for crude oil takeaway and export capability from the Permian Basin and look forward to adding a high-quality source of cash flow to our portfolio. The EPIC Crude Pipeline, together with our other recently announced joint ventures, is a crucial piece in building a leading Permian Basin midstream platform and delivering long-term value for our unitholders.”Read more
Wood has been awarded a $34 million contract from RH energytrans LLC to construct 28 miles of new pipeline designed to carry natural gas from Pennsylvania to Ohio.
Awarded through a competitive tender process, Wood’s scope also includes the construction of the North Kingsville meter station in Ashtabula County, Ohio.
The project is underway and expected to be completed in Summer 2019.
The Risberg pipeline will connect to 32 miles of existing pipeline, originating in the area of Meadville, Penn., extending in a northwest direction and terminating at the North Kingsville meter station.
About 16 miles of new pipeline will be installed in Pennsylvania and 12 miles in Ohio.Read more
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