Mountain Valley Pipeline, LLC, a joint venture formed earlier between NextEra Energy, Inc.’s NEE business wing, NextEra US Gas Assets and an affiliate of EQT Corporation EQT welcomed two more partners on board.
The companies announced that a unit of WGL Holdings, Inc. WGL, WGL Midstream and a subsidiary of Vega Energy Partners, Ltd., Vega Midstream MVP LLC have acquired a 7% and a 3% ownership interest in the joint venture respectively.
NextEra will now own a 35% stake and EQT Corporation’s subsidiary, EQT Midstream Partners LP EQM will hold its parent’s 55% interest as well as operate the pipeline project.
Per the agreement, WGL Midstream will be a shipper on the proposed project and has committed to buy a hefty amount of natural gas at the Zone 5 compressor station 165 of Transcontinental Gas Pipe Line Company, LLC in Pittsylvania County, VA.
The 300-mile Mountain Valley Pipeline stretches from northwestern West Virginia to Southern Virginia. The proposed project is designed to cater to the transportation constraints faced by the producers in Marcellus and Utica shale. Thanks to the pipeline, the markets in the Mid- and South Atlantic regions of the U.S. are expected to receive minimum two billion cubic feet per day of firm transmission capacity.
The project costing around $3–$3.5 billion is yet to be approved by the Federal Energy Regulatory Commission (FERC) and is expected to come online by 2018 end. It has however secured a 20-year commitment for its minimum capacity amount.
In the years to come, natural gas is predicted to be the most preferred fuel in America. The soaring demand will necessarily require strengthened transportation infrastructure in the Marcellus and Utica shale plays.
NextEra Energy currently carries a Zacks Rank #3 (Hold).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment