FERC also issued an EIS that recommended the construction, with modifications to the original plan, of the Constitution Pipeline. This pipeline would deliver up to 0.64 Bcf/d of Marcellus gas from Susquehanna County, in northeastern Pennsylvania, to Wright, New York, where the Wright Compressor Station is currently located. Iroquois would build a new compressor station at an adjacent facility under WIP, and modify the existing compressor station. Cabot Oil & Gas has a binding agreement for 0.49 Bcf/d of firm capacity on the Constitution Pipeline, while Southwestern Energy has an agreement for the remaining 0.15 Bcf/d.
The Iroquois Pipeline currently transports gas south to the Wright Compressor Station from its interconnect with TransCanada's Canadian Mainline in Waddington, New York. At Wright, Iroquois interconnects with Kinder Morgan's Tennessee Gas Pipeline (TGP) northern 200 line, which can flow gas to New England customers via its interconnect with AGT south of Boston, but has delivered increasing amounts of natural gas to the Canadian Mainline via its Niagara Falls interconnect with TransCanada.
The Constitution Pipeline's ability to move Marcellus production to northeastern consumers would significantly benefit from construction of TGP's planned Northeast Expansion Project. This project would take gas from Wright to Dracut, Massachusetts, where it would connect with TGP's existing pipeline as well as a line jointly operated by Spectra's Maritimes & Northeast Pipeline and the Portland Natural Gas Transmission System. Open season for firm capacity agreements on the Northeast Expansion Project began on February 13, and will continue until March 28. Project capacity could range from 0.60 Bcf/d to 2.20 Bcf/d, according to TGP documents.
Henry Hub price decline continues. The Henry Hub spot price decreased during most of the report week, before slightly rebounding to close at $5.97/MMBtu on Wednesday, February 19, 18 cents/MMBtu below its closing price on Wednesday, February 12. This marks the second week in a row that the Henry Hub spot price decreased, after reaching its highest level since 2008 on Wednesday, February 5, during a spate of bitterly cold weather throughout the country. Despite the overall decline, the Henry Hub spot price is $2.68/MMBtu above its closing price at this time last year.
Price changes vary nationwide. Prices in the northeastern United States rose significantly on Friday, February 14, as a severe winter storm hit the East Coast. However, prices declined for the remainder of the report week, and were down for the week as a whole. The natural gas spot price at the Algonquin Citygate hub serving Boston area consumers rose from $15.64/MMBtu on Wednesday, February 12, to $23.04/MMBtu on Friday, February 14, but closed yesterday at $13.83/MMBtu as temperatures warmed in the aftermath of the winter storm. Similarly, the spot price at the Transcontinental Pipeline's Zone 6 trading point for delivery into New York City rose from $7.80/MMBtu on February 12 to $8.97/MMBtu on February 14, but then declined to $6.10/MMBtu yesterday.