Columbia Gas Customers in OH Start Using M-U Gas in April

We often write about pipeline projects in the Marcellus/Utica and their mission to move our prodigious natgas production to new markets where the gas will fetch a higher price. Last fall MDN provided a list of 15 active pipeline projects in our region, aimed at moving our gas to new markets (see List of 15 Active Marcellus/Utica Pipeline Projects Worth $23B). However, sometimes the “new” markets these pipelines serve are located–right here, in the M-U region! That’s right. Not all gas needs to go to the South, the Southwest, Midwest or get exported to Canada and beyond. Sometimes new market demand is hidden in plain sight. Such is the case for Columbia Gas (owned by NiSource) in Ohio. The company said it has “changed our portfolio around” to source locally extracted Marcellus/Utica gas for “at least 40%” and “likely much more” of the gas it sells to its customers. The change to using Marcellus/Utica gas will begin in April. Among the pipelines that will flow the M-U gas Columbia will buy is the recently completed Leach XPress (see Leach XPress Goes Online; FERC Approves Mountaineer & Gulf XPress). Here’s the good news that our own gas will serve those in our own region…
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NiSource 1Q16: The Gas & Electric Business is Quite Profitable

NiSource service area
NiSource service area

NiSource and Columbia Pipeline split up last summer (see NiSource/Columbia Pipeline Divorce is Final). Columbia retained the midstream business and is the more active of the two in the Marcellus/Utica Shale. However, NiSource with its Columbia Gas utility business is still an important user of Marcellus/Utica Shale gas–and therefore of interest to us. Yesterday NiSource issued their first quarter 2016 update. Being in the utility business ain’t a bad life. Pretty reliable income, even if it is regulated. In 1Q16 NiSource made $309.5 million before income taxes were paid, compared with $275.4 million in 1Q15 (a 12% increase). Below is the update for NiSource’s natgas and electric utility businesses…
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Dominion & NiSource Bow Down to Lord Obama, Worship the EPA

Yesterday the Environmental Protection Agency (EPA) unveiled the Natural Gas STAR Methane Challenge Program at the Global Methane Forum held in Washington, DC. The Methane Challenge is a “voluntary” program for obsequious companies to pretend they’re concerned about so-called fugitive methane escaping into the atmosphere and toasting Mom Earth. Silly, we know–but this is how some billion dollar companies gain favors from the political establishment–and improve their evil fossil fuel image with the nutjobs who believe in this stuff. Tragically, several Marcellus midstream companies, including Dominion, NiSource and UGI signed on to this flummery. There are 41 such companies from across the country who have signed on to the Methane Challenge (we list them all below). Prediction: It won’t be long before this “voluntary” program becomes involuntary–with the jackboots of the EPA on the necks of all oil and gas companies to get them to comply with the unrealistic standards in the program…
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Columbia Gas of PA Asks PUC for Permission to Raise Rates

Columbia Gas of Pennsylvania, a division of NiSource, has filed a request with the Pennsylvania Public Utility Commission (PUC) to raise rates so it can recuperate costs spent in upgrading its natural gas delivery system for customers. Columbia Gas has spent $1.1 billion from 2007 to 2015. However, they’re only asking for a mere $55 million rate increase…
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NiSource/Columbia Pipeline Divorce is Final

The NiSource/Columbia Pipeline Group are now officially divorced. Well, they call it a “separation,” but it’s really a divorce. Amicable, but permanent. Last September MDN brought you the news that NiSource, owner of Columbia Gas, would be spinning Columbia off into its own company in 2015 (see NiSource Splits in Two: Columbia Pipeline Will be Separate Company). NiSource the utility will remain focused on being a utility, and Columbia Gas will be spun off into it’s own company called Columbia Pipeline Group (CPG) under a master limited partnership (MLP) structure. As of yesterday the divorce is final and the two companies have gone their separate ways…
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Columbia Pipeline Floats IOUs to Pay Down Debt, Fund Dividend

NOTE: NiSource/Columbia called MDN to clarify that the IPO earlier this year was for Columbia Pipeline Partners, NOT Columbia Pipeline Group as we had incorrectly stated in the original version of this story. Thank you NiSource! We’ve slightly modified the opening paragraph below to make it accurate.

The mad dash to raise cash continues in both the upstream and midstream sectors. Today it’s a company in the midstream (pipelines and process plants). In February of this year, NiSource spun off Columbia Pipeline Partners into it’s own company with a $1.1 billion initial public offering of “units” (think shares of stock, see Columbia Pipeline IPO Blows By Rosiest Expectations, Nets $1.1B). Columbia Pipeline Group (of which Columbia Pipeline Partners owns 15.7%) will become its own company and trade under its own stock ticker (CPGX) starting July 1. Yesterday Columbia Pipeline Group announced they are floating a series of IOUs, or “senior notes” looking to raise an eye-popping $2.75 billion. What will they use it for? A little over $1 billion will be used to pay off “intercompany debt” ahead of the separation. Another $1.45 billion will be used for a “special dividend to NiSource in connection with its planned separation from NiSource.” The balance of ~$300 million will be used for “general corporate purposes”–paperclips and such…
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Columbia Pipeline IPO Blows By Rosiest Expectations, Nets $1.1B

Last week MDN told you that NiSource was launching an initial public offering (IPO) and spinning off its Columbia Pipeline Group subsidiary into its own subsidiary. NiSource and Columbia were hoping to raise upward of a huge $1 billion (see Columbia Pipeline Floats IPO, Hopes for Upward of $1B). Guess what? They got MORE than $1B! They ended up netting $1.1 billion after pricing units at $23 each (their target was $19-$21). When the units started to trade, they hit $28.01 per unit for a time before falling back to $26.79. How did Columbia’s IPO measure up with some other recent northeast midstream IPOs, like CONSOL, Rice Energy and Antero Resources?…
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Columbia Pipeline Floats IPO, Hopes for Upward of $1B

Last September NiSource announced they would spin off subsidiary Columbia Pipeline Group into its own company (see NiSource Splits in Two: Columbia Pipeline Will be Separate Company). It took a few months, but the two operations finally determined which executive would go with which company (see Who Gets the Kids in NiSource/Columbia Gas Divorce?). Earlier this week we finally learned the details of the initial public offering (IPO) for Columbia–how much money they plan to raise. NiSource said the IPO will float an initial 40 million “common units” (think shares of stock) with an option to add another 6 million to the pot. They hope to get between $19 and $21 per unit, meaning a total of between $760 million on the low side, to $966 million on the high side…
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Who Gets the Kids in NiSource/Columbia Gas Divorce?

At the end of September MDN brought you the news that NiSource, owner of Columbia Gas, will be spinning Columbia off into its own company in 2015 (see NiSource Splits in Two: Columbia Pipeline Will be Separate Company). NiSource the utility will remain focused on being a utility, and Columbia Gas will be spun off into it’s own company called Columbia Pipeline Group (CPG) under a master limited partnership (MLP) structure. It’s an amicable divorce. But you know, when people get divorced, they have to split everything–including the kids. Who gets the kids? NiSource and Columbia issued an announcement today detailing which executives will stay with NiSource, and which will go with Columbia–along with a list of who will sit on which board of directors…
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Hilcorp Begins Drilling the Brinker Field in Columbiana County, OH

Funny how old stories become new again. Back in September 2012 MDN first told you about the Brinker Storage Field, a 35,000-acre area in Columbiana County, OH used by Columbia Gas to store natural gas supplies in the Berea Sandstone formation. They’ve been storing gas in it for more than 50 years. The problem that we highlighted back in 2012 is that landowners, who signed leases to allow that storage, were going to get shafted out of royalties for leases Columbia had signed with Hilcorp to drill Utica Shale wells under the Brinker area (see Columbia Gas & Hilcorp Meet with Landowners in Brinker Field). A few months after a meeting with Columbia and Hilcorp reps, many landowners signed revised leases that cut them in on the action–with a 15% royalty (see Some Brinker Field (OH) Leases Revised, Others in Lawsuit). However, some landowners sued. It appears they lost since Hilcorp has filed for permits to begin active drilling in the Brinker. The Ohio Dept. of Natural Resources (ODNR) has already approved 6 of 25 permit applications from Hilcorp, and we expect the others will also be approved…
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Columbia Hits Resistance to Compressor Upgrade in SE PA

A year and a half ago MDN told you that Columbia Gas, a subsidiary of NiSource, was planning to upgrade a compressor station in Forks Township (Northampton County), PA (see Columbia’s SE PA Pipeline Project Includes Compressor Upgrade). The upgrade is part of Columbia’s East Side Expansion project, a project that includes 16 miles of new pipelines to carry cheap Marcellus Shale gas to a natural gas-powered electric generating plant (and other customers) across the border in New Jersey. Last year we reported that the neighbors of the project were just fine with the upgrade. Today, that’s changed, although how much opposition is yet to be fully determined…
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NiSource 3Q14: A Lot of Irons in the Fire, Spending Billions

NiSource, owner of the Columbia Pipeline Group (with lots of projects cooking in the northeast) issued its third quarter 2014 update yesterday. We have a fair bit of news in the release about their midstream activities in the Marcellus and Utica Shale region. They also update progress on their massive modernization project in replacing a lot of existing pipeline in the northeast–to the tune of $12-$15 billion over the next 10 years. The update highlights progress for the recently announced Leach and Rayne XPress projects, the WB XPress, Mountaineer XPress and the Washington County Gathering project. There’s a lot in there!…
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NiSource Splits in Two: Columbia Pipeline Will be Separate Company

Breaking Up is Not So Hard to DoNiSource is a very big public utility company (electric & gas) serving 3.8 million customers from the Gulf Coast through the Midwest to New England. Headquartered in Indiana, NiSource is also the parent of Columbia Gas, which owns extensive pipelines and recently announced they would build another two new pipelines in the Marcellus region (see Columbia Gas: $1.75B for 2 Projects to Send Marcellus Gas to Gulf). NiSource has decided and in an unusual move announced yesterday (Sunday) that they are splitting the company in two. NiSource the utility will remain focused on being a utility, and Columbia Gas will be spun off into it’s own company called Columbia Pipeline Group (CPG) under a master limited partnership (MLP) structure. MLPs issue “units” instead of shares of stock–although functionally they are about the same thing. Here’s the details from NiSource…
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Columbia Gas: $1.75B for 2 Projects to Send Marcellus Gas to Gulf

Columbia Pipeline Group, a division of NiSource, announced yesterday they have decided to move forward with investing $1.75 billion dollars for two new projects. The first is a pipeline project that will begin in Marshall County, West Virginia, cross Ohio and end up in Leach, Kentucky. Hence, the new project is called the Leach Xpress. Yes, the marketers at Columbia could of/should of come up with a better name than “leach” for a pipeline, but we’ll just have to live with it (as we sigh and shake our heads). The 160-mile pipeline will pump abundant, cheap Marcellus and Utica Shale gas to various sales points along the pipeline (interconnecting with other pipelines). But perhaps most importantly, it will pump gas to Leach, and that’s the second major project. There is an existing pipeline from Leach all the way to the Louisiana Gulf Coast. That pipeline is called the Rayne, for Rayne, LA. The Rayne Xpress project will beef up the pipeline with new compressor stations to add an additional 1 billion cubic feet per day of capacity–Marcellus and Utica Shale gas capacity that will flow to the Gulf Coast…
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NiSource 2Q14: Progress on Marcellus/Utica Midstream Projects

NiSource, a major gas & electric utility company operating in the northeast and southwest (and parent of Columbia Gas and Columbia Pipeline), is in the midst of investing 3/4 of a billion dollars investment in five Marcellus and Utica Shale projects (see NiSource: 5 Marcellus/Utica Projects, $744M Investment). Last week NiSource issued second quarter 2014 results, including an update on some of those projects. Here’s relevant portions of the update touching on the Marcellus/Utica:
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Rice Energy Big Winner of 2014 Energy Leadership Awards in Pitt

Three people won the prize for Top Energy Executive of the year. All three have the same last name. All three work for the same company. And the company also has the same name as the three winners: Rice. Dan Rice IV, president and CEO, Toby Rice, COO, and Derek Rice, VP of exploration and geology won the Pittsburgh Business Times’ top honors at the 2014 Annual Energy Leadership Awards. A ceremony with over 400 people was held in Pittsburgh earlier this month where Derek was on hand to collect the prize for he and his brothers. In addition to big winner Rice Energy there were 20 other categories and award winners…
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