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Midla strikes agreement in principal on aging pipeline

pipesNATCHEZ — American Midstream Midla, LLC, a subsidiary of American Midstream Partners, LP, has reached an agreement in principle regarding Midla’s interstate pipeline that traverses Louisiana and Mississippi.

Parties involved reached the agreement in principle in order to provide continued service to Midla’s customers while addressing safety concerns with the existing pipeline.

Midla and the parties agreed that Midla may retire the existing 1920s vintage pipeline and replace the existing natural gas service with a new 12-inch pipeline from Winnsboro, Louisiana, to Natchez (Natchez Line) to serve existing residential, commercial and industrial customers. Customers not served by the new Natchez Line will be connected to other interstate or intrastate pipelines, other gas distribution systems or offered conversion to propane service. The agreement is subject to final agreements and ongoing proceedings at the Federal Energy Regulatory Commission (FERC).

Under the agreement in principle and subject to FERC approval, Midla will execute long-term agreements to recover its investment in the Natchez Line. Midla estimates it will take up to two years to secure the necessary permits and construct the Natchez Line.

“We are pleased to have reached an agreement in principle, and believe the areas currently served by Midla will see increased economic activity associated with the reconstruction and reconfiguration,” said Steve Bergstrom, executive chairman, president and CEO of American Midstream Partners. “When complete, the Natchez Line will offer higher pressure service with higher quality gas and additional available capacity, which should benefit efforts to bring new industry to the area. We appreciate the hard work and good faith of the parties involved and the FERC’s ADR division to bring about this agreement in principle and we look forward to finalizing the agreements and moving forward with the project.”

Midla anticipates filing a formal settlement with the FERC within the next 30 days and receiving approval by late 2014 or early 2015.

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