WGL to invest in Pennsylvania pipeline project

WGL Midstream will invest approximately $410m in the Central Penn Line, a new pipeline project which will originate in Susquehanna county and extend to Lancaster county in Pennsylvania, US.

In an agreement with three other parties, the company will create a new company to jointly develop and own the Central Penn Line, together with Transcontinental Gas Pipe Line.

The 177-mile pipeline is the greenfield pipeline segment of Transco’s recently announced Atlantic Sunrise project, which has a projected in-service date in the second half of 2017.

WGL Midstream’s investment is expected to result in a majority ownership interest in the company that will co-own the Central Penn Line with Transco.

As part of Atlantic Sunrise, the natural gas Central Penn Line project has been designed to provide new gas transportation capacity from various supply points in northeast Pennsylvania to a delivery point into mainline of Transco in southeast Pennsylvania.

The pipeline will be part of a transformational project in light of the increased production of natural gas in the Marcellus region. It will carry and deliver up to around 1.7 million dekatherms per day of natural gas.

WGL chairman and CEO Terry McCallister said: "As the need for natural gas continues to increase, WGL is well positioned to meet future demand levels and will be able to continue to provide more businesses and residential customers with the benefits of safe and reliable natural gas."

In connection with the investment, WGL Midstream has entered into an agreement with Cabot Oil and Gas to purchase 500,000 dekatherms per day of natural gas over a 15-year term.