Equitrans L.P, a subsidiary of Pittsburgh-based EQT Corporation (EQT), has received the consent of the Federal Energy Regulatory Commission (FERC) to construct a new natural gas pipeline in Pennsylvania and West Virginia.
Construction of the new project, known as Sunrise, includes the setting up of an approximately 41.5 miles, 24-inch-diameter pipeline and 2.7 mile, 16-inch-diameter pipeline. The pipelines will run through Wetzel County, West Virginiato Greene County, Pennsylvania and is estimated to cost around $272 million. It also includes building a new compressor station near Jefferson in Greene County.
EQT is expected to commence construction within a week and expects the project to come online before the summer of 2012. The new pipelines will help the company to deal with speedy development of natural gas from both the liquids rich and dry areas of the Marcellus Shale formation and serve the Mid-Atlantic and Northeastern markets as well as local distribution companies and on-system storage.
The Sunrise project will provide the much needed infrastructure to assist nonstop development of the Marcellus acreage in northern West Virginia. The pipeline is deemed to benefit producers with liquids rich acreage as it will assist in the delivery of gas to the market by linking with natural gas liquids processing systems.
With an increasing reserve structure and a projected higher number of Marcellus wells to be drilled in the coming five years, we believe that the company exhibits industry-leading organic growth momentum. The new project further enhances the company’s value as infrastructure forms a vital part for growth of any region.
EQT holds a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. For the longer term, we maintain an Outperform rating on the stock. Range Resources Corporation (RRC) and Cabot Oil & Gas Corporation (COG) are major competitors of the company.
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