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Natural gas pipeline project on track, says Spectra VP

With Mississippi becoming a national energy corridor, a new natural gas pipeline proposal underscores that position. Construction on the $842-million Southeast Supply Header (SESH), a joint project of Spectra Energy and CenterPoint Energy, is scheduled to begin in November. This 270-mile pipeline will run through 12 Mississippi counties and will have approximately one billion cubic feet per day of pipeline capacity.

David Shammo, Spectra’s vice president of the Southeast Supply Header, said the federal permitting and approval process is moving along well.

“The pipeline is the subject of deep review and is exceeding our expectations,” he said. “We expect our certificate in the next 60 to 90 days, then we’ll go into construction on or about November 1. Now the challenge is to find the myriad of people who’re in high demand for construction.”

Negotiations are being conducted with landowners for the required number of feet the pipeline must have for right of way, and it is expected to be in service in the summer of 2008.

Several factors have converged to bring about the need for the new pipeline, according to Shammo. Those include a change in the supply environment for the East Coast; a decline in shelf production offshore with more production shifting onshore; and the devastating hurricanes of 2005.

“The message from eastern markets was for more stability. The North American supply picture is changing and the reliability of the supply so we just connected the dots to do this project,” he said. “There’s a lot of shifting going on in the industry and there are a lot of projects.”

With two-thirds of the pipeline project in Mississippi and plans on tap for some additional growth, Shammo predicts significant investment in the state over the next 20 years.

“Everything is in place for Mississippi to take advantage of these investments,” he said. “The state has an advantageous geographic location and salt deposits.”

Joe Sims, president of the Mississippi/Alabama Division of the U.S. Oil and Gas Association, said the new pipeline would give the state economic development advantages. “It will provide Mississippi customers with sources to purchase gas and will supply growth,” he said. “One primary subscriber to receive natural gas from SESH is Mississippi Power’s Plant Daniel.”

Officials with the SESH held a series of meetings last month in the communities along the pipeline’s route, which runs from Vicksburg to Lucedale in Mississippi. Sims said the project has been favorably accepted.

“Local officials and landowners have some questions and issues that are being addressed,” he said.

He added that on any given day Mississippi has as much gas flowing through the state as any other state. With the state home to 12 major natural gas pipelines, this project will be an important addition to that existing energy infrastructure.

The proposed pipeline will bring natural gas supplies from the Perryville Hub in northern Louisiana to interconnecting pipelines serving the eastern U.S. and terminate at the Gulfstream Natural Gas System near southern Mobile County in Alabama.

State Rep. John Reeves, who chairs the House Oil and Gas Committee, supports the SESH project as Mississippi positions itself to be part of the country’s solution to rising energy costs and concerns.

“While work remains to be done in advancing alternative fuels, improving energy efficiency and increasing supplies of domestic natural gas, fuel refining and electricity — there is good news for Mississippi as new energy projects and expansions are underway across the state,” he said.

Contact MBJ contributing writer Lynn Lofton at llofton656@aol.com.

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