Gulf South enters deal to transport natural gas to Freeport LNG

Gulf South Pipeline Company, a unit of Boardwalk Pipeline Partners has entered into 20-year firm precedent agreements with foundation shippers to transport approximately 1.4 billion cubic feet per day of natural gas to serve the first two trains of the planned liquefaction terminal, announced by Freeport LNG Development, near Freeport, Texas.

Freeport LNG has received its Final Order for the development of the liquefaction terminal from the Federal Energy Regulatory Commission (FERC) and anticipates receiving FERC’s authorization to construct in the near future.

Gulf South plans to construct an approximately sixty-five mile pipeline supply header to serve the liquefaction terminal, to be named the Coastal Bend Header, and expand and modify existing facilities in order to provide access to additional supply sources for the header with an anticipated start date in 2018, subject to Gulf South and customer board approvals, final investment decision by Freeport LNG and receipt of all necessary regulatory approvals. The shippers on the header will have the flexibility to source supplies from several third party pipelines directly connected to the header and access storage facilities within the region.

Gulf South is conducting a binding open season to solicit bids for additional capacity in excess of the foundation shippers’ contracted capacity for both the new supply header and expansion of its legacy system. The open season will run for a thirty day period beginning at 8:00 a.m. Central Daylight Time, September 11, 2014, and ending at 5:00 pm, Central Daylight Time, October 10, 2014. Final capital expenditures associated with this project will be determined after the open season has concluded and the final capacity of the pipeline is known.

“We are very pleased to add the foundation shippers to our portfolio of customers and look forward to serving them under these new, long-term agreements as well as the opportunity to offer additional capacity to the market,” said John Haynes, senior vice president and CCO of Gulf South. “Boardwalk’s pipeline network is well-suited to deliver to growing markets in the Gulf Coast. We offer reliable, customer-focused firm transportation and storage services and are located near, or attached to, many natural gas shale supply sources including the Eagle Ford, Barnett, Haynesville, Cana-Woodford, Fayetteville, Marcellus and Utica; and over time, Gulf South’s Perryville Exchange will become a meaningful hub for producers, end-users and LNG off-takers to trade volumes.”

Press Release, September 11, 2014; Image: Freeport LNG