Kinder Morgan cancels NED Pipeline; Constitution Pipeline forges ahead

gas pipeline
Source: DollarPhotoClub

Kinder Morgan has decided to pull the plug on its proposed Northeast Energy Direct pipeline, citing low gas prices and lack of interest from gas distributors. The project was still under review by FERC and was planned to go online in 2018.

The $3.3 billion project, being developed by subsidiary Tennessee Gas Pipeline, was to deliver shale gas from Pennsylvania into New York, with a line also running through Massachusetts and New Hampshire.

Kinder Morgan said in a statement that “The board’s initial approval was based on existing contractual commitments at the time by local gas distribution companies to purchase natural gas from the project, as well as expected commitments from additional LDCs, electric distribution companies, and other market participants in New England.”

“Unfortunately, despite working for more than two years and expending substantial shareholder resources, TGP did not receive the additional commitments it expected. As a result, there are currently neither sufficient volumes, nor a reasonable expectation of securing them, to proceed with the project as it is currently configured,” it added.

Understandably, opponents of the NED pipeline, including two members of the Massachusetts congressional delegation, were elated.

“Today is a big victory for Western Massachusetts and our state’s future as a leader in clean and renewable energy,” said Congressman Jim McGovern, D-Worcester, a longtime opponent of the project. “With the defeat of this pipeline, it is clear that the voices of Western Massachusetts families have been heard. I am so proud of the incredible activism led by my constituents.”

“The safety and health of our communities must be our first priority,” McGovern continued. “With so many concerns raised about how the pipeline could impact local drinking water, our farmers and the crops they grow, and ongoing conservation efforts, I believe it is the right decision to halt development of the pipeline. People must always come before profits, and today the people won.”

Conservation Law Foundation president Bradley Campbell said: “It’s a rare thing to see a fossil fuel company admit there simply isn’t enough need for what they’re selling,” adding: “It is increasingly apparent that free market forces are rapidly driving us toward a clean energy future, and today’s decision by Kinder Morgan is a telling sign of things to come. Our environment, our economy and the health of our communities depend on continuing to see fossil fuels out the door.”

Meanwhile, the 124-mile Constitution Pipeline from Pennsylvania’s shale gas fields to eastern New York, is well on its way to start construction. Constitution Pipeline Company, a partnership formed by Cabot Oil & Gas, Williams Partners and Piedmont Natural Gas Company, plans to begin construction in the fall and go online in the second half of 2017.

The project is still pending the Department of Environmental Conservation decision on a water quality permit.

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