Cabot O&G Partners with Williams on New Marcellus Pipeline

Cabot Oil & Gas is teaming up with Williams Partners to construct a new pipeline that will stretch from Cabot’s Marcellus gas wells in Susquehanna County, PA to Schoharie County, NY where it will connect to two interstate pipelines. The new pipeline will let Cabot sell its ever-increasing production of northeastern PA shale gas into more lucrative markets in New York and New England. The new pipeline is due to go online in March 2015.

From the Cabot press release yesterday:

Cabot Oil & Gas Corporation today announced a new Joint Venture with Williams Partners L.P. to develop and construct a large diameter pipeline, specifically designed to transport Cabot’s Marcellus production to both the New England and New York markets. Deemed the "Constitution Pipeline" this high pressure pipeline will be capable of moving at least 500,000 Mcf per day from the heart of Cabot’s Marcellus acreage in Susquehanna County, PA to interconnect with both Iroquois Gas Transmission and Tennessee Gas Pipeline in Schoharie County, NY. Williams Partners will be a 75% owner and, through its affiliate, will operate the pipeline, while Cabot will retain a 25% equity position. Cabot’s commitment to firm transportation representing the initial design capacity of the pipeline is sufficient to enable the project to go forward subject to receipt and acceptance of the necessary regulatory approvals.  The initial in service date for the system is slated for March 2015.

"This pipeline is truly the next big step of our capacity expansion program and positions us with access to the premium New England and New York marketplace that has historically been constrained from both a lack of reliable supply and pipeline infrastructure," said Dan O. Dinges, Chairman, President and Chief Executive Officer. "We see this pipeline playing an important role in the future development of our world class resource that will bring a reliable and dependable long term natural gas supply into an expanding premium market which for years has been searching for that fundamental supply link. As we move forward as a country and progress towards true energy independence, just consider what positive possibilities exist with our Marcellus production entering both a constrained demand area and an area hungry for development, especially in the power generation industry."

Dinges added, "The vast majority of our investment in the pipeline will be contributed during the 2014 and early 2015 time frame, when the macro environment for gas will benefit from new gas power generation and the potential for export. Additionally, we expect to be producing multiples of our current production volumes at that time."

*Cabot Oil & Gas (Feb 21, 2012) – Cabot Oil & Gas Corporation Announces New Joint Venture Pipeline

  • Anonymous

    This seems to be a virtual pipeline project that exists only in a Cabot press release.  Despite claiming that it will be operational just after El Paso’s Northeast Exchange, which has a very similar route, this is the first mention.  In contrast El Paso has been making presentations since last year and has begun surveys first with helicopters and recently on the ground.  I suspect corporate gamesmanship by Cabot.

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