© 2023 Louisville Public Media

Public Files:
89.3 WFPL · 90.5 WUOL-FM · 91.9 WFPK

For assistance accessing our public files, please contact info@lpm.org or call 502-814-6500
89.3 WFPL News | 90.5 WUOL Classical 91.9 WFPK Music | KyCIR Investigations
Play Live Radio
Next Up:
0:00 0:00
Available On Air Stations
Stream: News Music Classical

Who Wants to Transport Natural Gas Liquids Through Kentucky? Two Companies are Asking.

It’s open season for hunting Kentucky deer—and apparently for Kentucky pipelines as well.Right now, there are two proposed pipelines that would carry natural gas liquids through Kentucky. One of these is theBluegrass Pipeline, a joint venture between Williams and Boardwalk Partners. The proposal involves 500 miles of new construction through Kentucky and Ohio to carry hydrocarbons from natural gas drilling (materials like ethane, butane and propane) to processing plants on the Gulf of Mexico. Go here for previous WFPL coverage of the Bluegrass Pipeline.And there’s also the proposed conversion of the Tennessee Gas Pipeline by Kinder Morgan and MarkWest. The project involves taking an existing natural gas pipeline and converting it to carry natural gas liquids (NGLs). The Kentucky portion of the project stretches from Greenup through Morehead and Campbellsville to the Tennessee border.The work acquiring easements for the Bluegrass Pipeline has already begun; last month, Williams representatives said the company had purchased easements in nine of the 13 Kentucky counties along the pipeline's route. Because the second pipeline involves converting existing infrastructure, MarkWest/Kinder Morgan already has the easements. Of the two projects, the Bluegrass Pipeline has received far more attention in the state and drawn passionate opposition from groups concerned about unintended environmental effects.Now, both pipelines have recently announced the beginning of their open seasons. From now until Dec. 16 (for the Bluegrass Pipeline) and Dec. 20 (for the Tennessee Gas Pipeline), the two partnerships are soliciting binding commitments from companies that want to use the projects to transport natural gas liquids. A Kinder Morgan spokeswoman says the company won’t begin a project until it knows it has enough customers to make the pipeline worthwhile. So that’s what this open season is—a way to evaluate the demand for the projects.Previously, executives for MarkWest and Williams have expressed clashing views on whether there’s enough demand for two new NGL pipelines from the Northeast to the Gulf of Mexico.From a story I did in August on the proposals: The Bluegrass Pipeline was announced first. But in a recent earnings call, MarkWest CEO Frank Semple told analysts that he only thinks there’s room for one pipeline. “[The Kinder Morgan/MarkWest project] absolutely competes with Bluegrass,” he said. “If you look at the volume projections out of the Utica and Marcellus, and clearly there’s a lot of variability in those forecasts, over the course of the next five years, you would expect that if there is a need for transporting the C2+ Y grade to the Gulf Coast, there’s probably only enough volume to support one of those two projects.” (“Y grade” gas is NGLs.) And it goes without saying that if MarkWest is pursuing this new pipeline, Semple thinks his project will be successful. “I believe at least in the near term, that there really will be only one Y-grade pipeline project to the Gulf Coast developed out of the Northeast,” he added. Williams company spokesman Tom Droege disagrees. He said in a statement that his company thinks there’s enough capacity for both pipelines. “The joint venture announcement from Kinder Morgan and MarkWest Utica EMG is further evidence of the vast opportunities that exist in the Marcellus and Utica regions,” he wrote. “We have seen significant interest from the producer community regarding the value that the Bluegrass Pipeline can offer the market. If anything, the demand for these projects is greater than originally anticipated and we believe in the not too distant future that we’ll look back and wish we had more capacity available to the region.”The success of both companies’ open seasons should help clarify the demand for the projects.Williams hopes to have the Bluegrass Pipeline in service by late 2015; the Tennessee Gas Pipeline is expected to be converted by the second quarter of 2016.

Can we count on your support?

Louisville Public Media depends on donations from members – readers like you – for the majority of our funding. You can help make the next story possible with a donation of $10 or $20. We'll put your gift to work providing news and music for our diverse community.