Proposed pipeline would connect Utica Shale to S. La.

07 11, 2013 by NO City Business

Two energy infrastructure companies are moving forward with a plan to connect booming oil and natural gas production in Ohio and nearby states to Louisiana with more than 1,100 miles of pipeline.

The Akron Beacon Journal reports that Williams of Tulsa, Okla. and Boardwalk Pipeline Partners of Houston have partnered to build the line, dubbed the Bluegrass Pipeline, and connect it to existing pipelines. The companies, in the process of negotiating with landowners now, did not disclose the price or the official route of the planned line.

The goal will be to transport up to 400,000 barrels per day of natural gas liquids produced in the developing Utica and Marcellus shale regions in Ohio and surrounding states to a delivery hub in Louisiana near Eunice, where it could then be sent to area refineries.

The planned line is part of a growing push to connect Louisiana to shale oil and natural gas production in other, largely rural, parts of the country.

Currently, much of that production is being transported to refineries via rail tankers, a costly and at times dangerous option. A tanker carrying crude oil
crashed into a town in Quebec on July 6, causing a massive explosion that killed at least 15 people.

The U.S. Energy Information Administration said today that rail shipments of oil and petroleum products jumped 48 percent during the first half of this year, though a rail car shortage and higher U.S. oil prices are slowing overall growth.

Royal Dutch Shell spokeswoman Destin Singleton told CityBusiness earlier this month that the company will close a portion of its Houston-to-Houma crude oil pipeline in order to complete a reversal project that will allow it to start moving crude produce in Texas shale plays to south Louisiana refineries.

Williams and Boardwalk plan to connect the Bluegrass Pipeline to an existing pipeline in western Kentucky that Boardwalk owns. Aside from new pipeline that will need to be built in parts of Ohio and surrounding states, the company anticipates the need to build additional pipeline, storage terminals and a large fractionation plant to process natural gas in Louisiana.

The companies are also exploring the development of a new liquefied petroleum gas export facility. LPG is a mixture of natural gas liquids such as propane, butane and butylene.

Williams and Boardwalk need to acquire needed land, receive the necessary permits and submit the project for public comment before moving forward with the pipeline. Plans for an export terminal would have to be approved by the Federal Energy Regulatory Commission.