Northeast Expansion will undertake the development, construction and ownership of the Kinder Morgan’s proposed Northeast Energy Direct (NED) natural gas pipeline project, located between Wright, New York and Dracut, Massachusetts, the US.
Under the terms of the agreement, APUC will initially subscribe for a 2.5% interest in the new entity with an option to increase its participation up to 10%.
The APUC’s total capital investment opportunity is expected to be up to $400m, based on the final pipeline configuration and design capacity.
Scheduled to commence commercial operations by late 2018, the project is expected to secure FERC certificate in Q4 2016.
APUC chief executive officer Ian Robertson said: "The partnership agreement provides APUC with the opportunity for additional investment in project expansions offering further diversification to our dynamic organization."
The pipeline capacity will be contracted with local distribution utilities to help ease constraints on natural gas supply in US.
Kinder Morgan Natural Gas Pipelines president Thomas Martin said: "The NED project could move up to 2.2 Bcf/d of supply originating from the Marcellus area from Wright, New York, to Dracut, Massachusetts and other customer-designated points to serve the New England market.
"The Tennessee Gas Pipeline system provides unmatched supply diversity, including incremental access to the prolific Marcellus and other shale plays, making the Northeast Energy Direct project an ideal solution to satisfy rapidly growing natural gas demand that is forecasted in the Northeast and New England in the years ahead."
Image: APUC and Kinder Morgan to form Northeast Expansion to develop natural gas transmission pipeline in the US. Photo: courtesy of supakitmod/Freedigitalphotos.net.
