Chesapeake First Customer for Ethane Pipeline to Gulf Coast

Looks like Enterprise Products’ plan to build an ethane pipeline from the Marcellus and Utica Shales to the Gulf Coast (see this MDN story) is already paying off. Chesapeake Energy is the first company to commit to using the pipeline, which is due to be completed and in service by 2014.

Chesapeake Energy Corp. said Wednesday it will anchor Enterprise Products Partners LP’s proposed ethane pipeline from northeastern states to the Gulf Coast.

The companies did not disclose financial details of their long-term contract.

The pipeline would have an initial capacity to carry 125,000 barrels per day and could be expanded, the companies said.

Shippers who commit to use the pipeline would pay between 14.5 cents and 15.5 cents per gallon.

The companies said the pipeline would deliver ethane produced in the Marcellus and Utica shale formations of Pennsylvania, West Virginia and Ohio about 1,230 miles to their storage complex for natural gas liquids in Mont Belvieu, Texas.*

*R&D Magazine (Nov 2, 2011) – Chesapeake, Enterprise to run ethane pipeline