Linking the Marcellus to Attractive Mid-Atlantic Demand Markets
KANSAS CITY, Mo.--(BUSINESS WIRE)--Mar. 1, 2012--
Inergy Midstream, L.P. (NYSE:NRGM), a subsidiary of Inergy, L.P.
(NYSE:NRGY), yesterday announced plans to jointly market and develop a
new interstate natural gas pipeline known as the Commonwealth Pipeline
with affiliates of UGI Corporation (“UGI”) and WGL Holdings, Inc.
(“WGL”). The proposed 200 mile, 30-inch pipeline is expected to
transport at least 800,000 dekatherms per day of natural gas when it is
placed into service; and affiliates of UGI and WGL are expected to
execute precedent agreements to become anchor shippers on the new
pipeline. The parties anticipate placing the new pipeline into service
The Commonwealth Pipeline will extend from the southern terminus of
Inergy Midstream’s MARC I pipeline in Lycoming County, Pennsylvania,
through UGI’s utility service areas in central and eastern Pennsylvania
to a point of interconnection with WGL’s gas distribution system near
Rockville, Maryland. The pipeline will connect attractive demand centers
in the Mid-Atlantic region, including Washington D.C., Baltimore, and
Philadelphia to abundant and reliable supplies of natural gas production
from across Pennsylvania while providing a more cost-effective
transportation path versus traditional routes.
“We are pleased to be working with UGI and WGL to develop this
significant infrastructure project, which will provide direct access to
new demand markets for gas producers,” said Bill Moler, Senior Vice
President and COO of Inergy Midstream. “Gas production in the Northern
tier of Pennsylvania has been limited by the lack of take-away capacity
in existing interstate pipelines, most of which currently serves markets
in the Northeast. The Commonwealth Pipeline is expected to provide
much-needed transportation capacity to desirable new and growing demand
markets in the Mid-Atlantic.”
John Sherman, President and CEO of Inergy Midstream, added, “This
project is a natural extension of Inergy Midstream’s storage and
transportation platform in the Northeast. We are committed to developing
the critical infrastructure that natural gas customers desire. For our
investors, this project adds to our plans for high quality, fee-based
cash flows that underpin the stability and growth of our cash earnings.”
The pipeline is expected to cross and interconnect with a number of
interstate pipelines along its route, providing customers greater supply
diversity while providing producers direct access to expanding markets
that are currently served only through legacy interstate pipelines. Upon
completion of the MARC I and the Commonwealth Pipeline, shippers will
have the ability to move volumes bi-directionally to or from multiple
pipelines (including Dominion Transmission, Tennessee Gas Pipeline,
Millennium Pipeline, Transco, and TETCO) across an interconnected
platform of assets to demand markets in the Northeast and Mid-Atlantic.
The sponsors expect to own equal equity interests in the project company
formed to own the Commonwealth Pipeline. The plans are for Inergy
Midstream to construct and to operate the pipeline, which is expected to
cost approximately $1.0 billion and be funded equally among the sponsors.
A non-binding open season will be announced in March 2012 for shippers
interested in acquiring capacity on the proposed Commonwealth Pipeline.
About Inergy Midstream, L.P.
Inergy Midstream, L.P., headquartered in Kansas City, Missouri, is a
master limited partnership engaged in the development and operation of
natural gas and NGL storage and transportation assets. Inergy Midstream
owns and operates natural gas storage facilities with aggregate working
gas capacity of 41 bcf, natural gas liquids storage facilities with
capacity of 1.5 million barrels, and natural gas pipelines with 355
MMcf/d of transportation capacity in New York and Pennsylvania. Inergy
Midstream, L.P. is a subsidiary of Inergy, L.P.
Cautionary Statement Regarding Forward-Looking Statements
This news release contains forward-looking statements, which are
statements that are not historical in nature such as the expectation
that (i) the proposed Commonwealth Pipeline will add additional
transportation capacity, will be placed into service in 2015, will
interconnect with multiple pipelines, and will cost approximately $1
billion; (ii) the sponsors will fund the cost equally and own equal
equity interests in the project company formed to develop the pipeline;
and (iii) affiliates of UGI and WGL will execute precedent agreements.
Forward-looking statements are subject to certain risks, uncertainties,
and assumptions. Should one or more of these risks or uncertainties
materialize or any underlying assumption proves incorrect, actual
results may vary materially from those anticipated, estimated, or
projected. Among the key factors that could cause actual results to
differ materially from those referred to in the forward-looking
statements are: weather conditions that vary significantly from
historically normal conditions; the demand for high deliverability
natural gas storage capacity in the Northeast; the general level of
petroleum product demand and the availability of natural gas and the
price of natural gas to the consumer compared to the price of
alternative and competing fuels; our ability to successfully implement
our business plan with respect to our continued expansion of our
midstream operations; our ability to generate available cash for
distribution to unitholders; the outcome of rate decisions levied by the
Federal Energy Regulatory Commission; and the costs and effects of
legal, regulatory, and administrative proceedings against us or which
may be brought against us. These and other risks and assumptions are
described in Inergy’s annual report on Form 10-K and other reports that
are available from the United States Securities and Exchange Commission.
Corporate news, unit prices, and additional information about Inergy
Midstream, including reports from the United States Securities and
Exchange Commission, are available on the Company’s website, www.Inergylp.com.
For more information, contact Mike Campbell in Inergy Midstream’s
Investor Relations Department at 816-842-8181 or via e-mail at firstname.lastname@example.org.
Source: Inergy Midstream
Mike Campbell, 816-842-8181