Michigan-based DTE Energy yesterday announced they will spend $250 million to build a new 37 mile long shale gas pipeline in Northeast PA and the Southern Tier of NY. Construction is expected to be complete by the middle of 2012.
Bluestone Gathering today announced the signing of a long-term agreement with Southwestern Energy Services Company to build and operate a natural gas gathering system in Susquehanna County, PA and Broome County, NY.
Bluestone, a wholly-owned subsidiary of DTE Energy, will deliver natural gas from the Marcellus Shale formation to the Millennium Pipeline in Broome County, NY and to Tennessee Pipeline in Susquehanna, PA. Houston-based Southwestern Energy Services, a wholly owned subsidiary of Southwestern Energy Company, is the primary customer for Bluestone.
The project is comprised of approximately 37 miles of 16"/20" diameter pipeline and will include many miles of high and low pressure smaller diameter pipeline for the in-field gathering system. Bluestone’s initial capacity will be over 250,000 dth/day to both the Millennium and Tennessee pipelines and is projected to be in-service in the second quarter of 2012. DTE Energy plans to spend more than $250 million over the next five years on both the Bluestone gathering lateral and in-field gathering system.
"We are excited about the opportunity to work closely with Southwestern Energy Services Company on this Project," said Peter Cianci, President of DTE Energy’s Gas Storage and Pipeline Company. "Southwestern has demonstrated its capabilities through its world-class operations in the Fayetteville Shale. They are now leveraging this expertise to develop a substantial position in the Marcellus Shale."
Additionally, Millennium Pipeline has approved its first two expansions slated to be in-service in late 2012 and late 2013. These two expansions are expected to increase Millennium’s capacity from 525,000 dth/day to approximately 825,000 dth/day by adding two compressor stations. DTE Energy owns 26.25% of Millennium Pipeline.
"Susquehanna County contains some of the most prolific gas wells in the Marcellus Shale," said Cianci. "Bluestone is part of our strategy to grow our natural gas business in the Northeast and provide a significant supply feed to the Millennium Pipeline."
Once online, Bluestone is expected to deliver over 1 Tcf of natural gas to Millennium and Tennessee Pipeline, with room to expand as demand increases over time.
Bluestone will be DTE Energy’s first gathering project outside Michigan. The company currently owns a 550 mile natural gas gathering system in northern Michigan which is designed to aggregate natural gas from the Antrim Shale and the Niagaran formations.*
*DTE Energy Press Release (Jul 5, 2011) – DTE Energy Subsidiary Signs Agreement to Build Natural Gas Pipeline in Pennsylvania