1) What is the Constitution Pipeline Project?
The Constitution Pipeline project involves the construction of a new natural gas transmission pipeline to transport natural gas supplies from the prolific Marcellus supply region in northern Pennsylvania to major northeastern markets in New England and New York by March 2015. The approximately 120-mile long, 30-inch Constitution Pipeline will have design capacity to transport 650,000 dekatherms of natural gas per day – a quantity of natural gas that can serve approximately 3 million homes. The pipeline’s design capacity is fully contracted with long-term commitments from established natural gas producers currently operating in Pennsylvania.
2) What other companies are participating in this project with Piedmont?
Piedmont joins Williams Partners L.P. (NYSE: WPZ), and Cabot Oil and Gas Corporation (NYSE: COG) as an equity investor in Constitution Pipeline Company, LLC. An affiliate of Williams Partners will construct, operate, and maintain the new natural gas transmission pipeline.
3) Could local communities receive natural gas service from this pipeline?
The pipeline would be considered an “open access pipeline,” meaning that local municipalities or public utilities could potentially tap the line in the future to provide residential, commercial and industrial natural gas service.
4) Is Piedmont Natural Gas going to start serving new customers in Pennsylvania and New York through its involvement in this project?
No. Piedmont Natural Gas is not a customer of the Constitution Pipeline nor is it certificated to provide natural gas distribution services in Pennsylvania, New York, or any other northeastern market. Piedmont provides retail natural gas distribution service in certificated areas in the states of North Carolina, South Carolina and Tennessee.
5) Will Piedmont’s current customers be served by this new Pipeline?
No. When completed, the Constitution Pipeline will deliver natural gas from the Marcellus supply region in northern Pennsylvania to major markets in New England and New York.
6) Why is Piedmont investing in this project?
Piedmont’s equity investment in the Constitution Pipeline Company, LLC aligns with our long-term strategic directive of expanding our complementary energy-related businesses as a means of enhancing shareholder value. The Company considers this a strategic investment in pipeline infrastructure to connect clean, low cost Marcellus natural gas supplies to premium East Coast markets. Piedmont is currently an equity investor in several other complementary natural gas infrastructure and retail marketing businesses: Cardinal Pipeline Company, LLC, an intrastate natural gas pipeline in North Carolina; Pine Needle LNG Company, LLC, an interstate liquefied natural gas storage facility in North Carolina; Hardy Storage Company, LLC, an underground interstate natural gas storage facility in West Virginia; and, SouthStar Energy Services, LLC, which is engaged in unregulated retail natural gas marketing, primarily in the retail natural gas markets in Georgia.
7) Are Piedmont’s customers paying for this pipeline through their rates?
No. Piedmont’s investment in the new pipeline is through a wholly-owned unregulated subsidiary and the costs of the project will not impact Piedmont’s customer rates.
8) Will Piedmont’s customers benefit from this project?
The Constitution Project should provide benefits to both Marcellus producers and consumers of natural gas along the Eastern Seaboard.
9) What is the approval process for the new pipeline?
Before the pipeline can be constructed, Constitution Pipeline Company must first obtain a Certificate of Public Convenience and Necessity from the Federal Energy Regulatory Commission (FERC), in addition to various state and local permits. In April 2012, Constitution Pipeline Company requested that FERC initiate a pre-filing environmental review of the proposed pipeline route. The project was assigned docket number PF12-9. You may access pre-filing documentation at the FERC website.
The FERC pre-filing process is intended to solicit early input from citizens, governmental entities and other interested parties to identify and address the siting of the proposed pipeline and compression facilities. The company hosted a series of public open houses during the summer of 2012 in the affected areas to formally introduce the proposal to the public and solicit feedback. Public input is important to the project and will shape the final project route.
Following the pre-filing period, Constitution Pipeline Company will file the formal certificate application with FERC in the spring of 2013 seeking approval to construct and operate the pipeline.
10) What is the project’s timetable in terms of construction and completion?
April 2012 – Pre-Filing process (underway)
June 2012 – Ground surveys (underway)
Summer / Fall 2012 – Open houses and informational meetings (underway)
Fall 2012 – FERC scoping hearings (underway)
Fall 2012 – Begin limited easement negotiations
Early 2013 – Submit draft environmental report to FERC
Spring 2013 – Submit 7(c) certificate application to FERC
April 2014 – Proposed construction start
March 2015 – Target in-service
11) Has the pipeline’s route been determined yet?
The approximately 120-mile long, 30-inch pipeline would extend from Susquehanna County, Pa., to the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in Schoharie County, N.Y. The proposed project route generally follows Interstate 88, stretching from Susquehanna County, Pa., into Broome County, N.Y., Chenango County, N.Y., Delaware County, N.Y., and terminating in Schoharie County, N.Y.
The preliminary project route attempts to maximize opportunities to follow existing corridors (power transmission lines, road right-of-way, I-88 corridor and existing pipeline corridors), while avoiding watersheds and aqueduct tunnels. The proposed route avoids populated areas where possible, while minimizing impacts to wetland, riparian and other high value wildlife habitat areas. The route also minimizes river and stream crossings to reduce environmental impact.
It is important to emphasize that the current route is preliminary and subject to change. Federal regulations require that the pipeline company conduct numerous studies and analyze a number of alternatives before filing an application with the FERC. A process known as the FERC pre-filing process is intended to solicit early input from citizens, governmental entities and other interested parties to identify and address the potential facility locations. Constitution Pipeline Company will host a series of formal public workshops in the affected areas to formally introduce the proposal to the public and solicit feedback.
For more information and answers to additional questions, please visit www.constitutionpipeline.com.