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UGI Energy Services to partner on $1B Marcellus pipeline

By , - Last modified: March 1, 2012 at 10:52 AM

UGI Energy Services Inc., a Valley Forge-based natural gas, electricity and liquid fuels marketer, is partnering with Kansas City, Mo.-based natural gas company Inergy Midstream to build a $1 billion pipeline to bring Marcellus Shale gas through the midstate to metro areas by 2015.

The 200-mile Commonwealth Pipeline would begin in Lycoming County and run between Harrisburg and Lancaster then crossing the Susquehanna River to York before continuing south to carry natural gas from the shale fields to Baltimore and Washington, D.C., said Peter Terranova, vice president of midstream assets and services at UGI Energy Services. The pipeline also would serve Philadelphia.

Construction could begin in 2014 and be completed by the summer of 2015, Terranova said. The project still needs state and federal regulatory approvals, he said.

The pipeline would add a significant number of jobs in construction trades during construction and to the energy companies after completion for maintenance and operation, but Terranova said he didn't have estimates.

UGI Energy Services and Capitol Energy Ventures Corp. would become the anchor shippers on the pipeline, according to the companies. Capitol Energy is a subsidiary of Washington, D.C.-based energy company WGL Holdings Inc.

UGI Energy Services is a subsidiary of UGI Corp., which also owns natural gas distribution company UGI Utilities Inc. The company has 62,000 customers in eastern, northeastern and central parts of Pennsylvania, including the midstate.

In December, UGI opened a similar direct-from-Marcellus pipeline in northeastern Pennsylvania.

Inergy, UGI and WGL trade their shares on the New York Stock Exchange under the ticker symbols NRGM, UGI and WGL, respectively.

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