A new pipeline in Snow Shoe Township could mean ramped-up well production in the area.
Superior Appalachian Pipeline began installing pipe in the township May 18. The company should complete the project in September and make it operational in October. SAP Vice President of Development Ken Magyar said rain this summer could push back completion and operation dates.
The pipeline will at first be connected to Dominion Transmission Inc.’s interstate pipeline and will likely be connected to Texas Eastern Transmission’s pipeline at a later date. Part of the planned route runs along a township road, so SAP paid the municipality about $220,000 for the right of way in April. Magyar declined to comment on the project’s total cost.
Plans for the pipeline have been six years in the making.
“(Planning) doesn’t necessarily take that long,” Magyar said. “The time line was protracted by producer’s plans and schedule for drilling. They have a lot of areas they’re focused on in Pennsylvania, but this pipeline is definitely a vehicle for (production) to happen a lot quicker. We try to time (installation) right for when gas will be produced.”
Magyar declined to say which companies plan to produce more gas in the area.
Centre County Planning and Community Development Office Assistant Director Sue Hannegan said Range Resources and Enerplus have Marcellus Shale well pads and leased acreage in the vicinity of the pipeline.
She also said there are four permitted wells in the township. Three are attributed to WPX Energy at the far western side of the township abutting the boundary with Clearfield County and the last by Range Resources is located to the northeast of Snow Shoe borough.
The project was designed to gather and connect wells to the interstate pipeline.
“There aren’t any other pipes in that area of this function or size,” Magyar said.
The pipeline could also be extended in the future, likely farther west, but production in the area has been slow to expand. Original plans called for about 14.5 miles of pipeline.
“Producers have drilled wells in the area, but they haven’t drilled much because there isn’t a market to get the gas out,” Magyar said. “We’re building a more than sufficient pipeline to do that ... We initially had a little larger plan compared to today. We scaled the scope of the project back. ”
The county has 64 drilled wells, 26 of which are actively in production. Another 23 are “regularly inactive.”
“This determination relates to Act 13 wherein the Unconventional Gas Well Fee, to be paid by the well operator, is suspended if the well is capped or if after two years the well does not reach a production rate of 90,000 cubic feet of gas per day,” Hannegan said. “The fee is reinstated when production resumes at that level.”
The remaining 15 wells were plugged.
Magyar said the pipeline could expand.
“Expansion would continue in Centre County, and that will be determined by producers,” he said. “They’ll dictate where it goes, and we’ll follow.”
DTI proposed separate plans, called the Leidy South Project, that would upgrade its facility in Pleasant Gap. The project spans three states and will cost about $210 million.
Plans call for upgrades to filters and separators at the Centre Compressor Station.
“Dominion Transmission has proposed the Leidy South Project to help meet the increasing demand for natural gas in the Mid-Atlantic Region,” DTI spokesman Frank Mack said via email. “The project would improve regional energy security by providing gas supply to existing and new electric power generation facilities, including Panda Power Funds’ Stonewall Plant, which has committed to the project.”
DTI submitted the project to the Federal Energy Regulatory Commission on May 15.
If approved, which could happen by spring 2016, the project could begin in May 2016 and be in service by October 2017.
“The upgrade (in Pleasant Gap) is needed because of the increased volume of gas that would be transported along the pipeline,” Mack said. “The filters and separators are used to catch any minute impurities prior to the natural gas entering the compressor station.”