Spectra Energy to increase stake in $1.2bn PennEast pipeline project
Spectra Energy Partners has agreed to purchase an additional 10% stake in $1.2bn PennEast interstate natural gas pipeline project in the US.
The company has signed purchase and sale agreement with Public Service Enterprise Group’s (PSEG) subsidiary PSEG Power to acquire minority equity position in the 115-mile PennEast pipeline.
Subject to certain conditions, the deal is expected to complete in the second quarter of this year.
Once the deal concludes, Spectra's stake in the pipeline will increase from 10% to 20%. The project has secured a positive draft environmental impact statement from the Federal Energy Regulatory Commission. It is expected to secure the final environmental impact statement in April.
PennEast pipeline is expected to become operational in the second half of 2018. The pipeline will carry around one billion cubic feet of natural gas per day.
In September 2014, PSEG Power had joined a consortium of companies that planned to develop the $1bn pipeline project in New Jersey. The pipeline starts in Luzerne County in northeastern Pennsylvania and end at Transco's Trenton-Woodbury interconnection in New Jersey.
PennEast managers board chairman Dat Tran said: “We’re pleased with PennEast’s progress and are excited to have Spectra Energy Partners, with its extensive experience in the region, become an equal equity partner.”
Spectra Energy Partners president Bill Yardley said: “From its inception, we have viewed the PennEast Pipeline as a critical project for the mid-Atlantic, connecting abundant domestic supplies to growing local markets in need of additional clean natural gas.”