Spectra Energy Puts Access Northeast Pipe to New England on Hold

Spectra Energy’s Access Northeast Pipeline project, a roughly $3 billion project to connect four existing pipeline systems (with enhancements): Texas Eastern, Algonquin Gas Transmission, Iroquois and Maritimes & Northeast, has suffered a string of setbacks this year. Spectra’s original strategy was to bring natural gas to New England by cutting deals with electric companies who need the gas to produce cheaper electricity at their natgas-fired power generation plants. However, the green environmental Nazis came out in force against the plan, (sadly) aided and abetted by Spectra’s competitors, and those plans are now in ruins with three states blocking any such plans (see MA Supreme Court Ruling Endangers New England Gas Pipelines; NH Regulators Veto Access Northeast Pipeline Contract; and CT Latest New England State to Give Up on NatGas Cooperation). Last month we reported that Spectra is not yet ready to give up. They’re changing strategies. Spectra says there are still some electric power generators on board (those that don’t need regulatory approval), and to make up the difference, Spectra is now targeting local natural gas distribution companies (LDCs) as potential customers (see Spectra Energy Changes Strategy re New England Pipeline). Spectra needs customers to sign on the dotted line–committing to long-term contracts–before they can raise the funding and build the project. This change in strategy means the project now won’t go online until 2019, at the earliest. In keeping with the revised schedule, Spectra, via their Algonquin Gas Transmission subsidiary, has just filed an update with the Federal Energy Regulatory Commission (FERC) to say things are officially now on pause while they “solidify the commercial foundation” (i.e. find new customers). How long will it be on pause?…

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