Spectra Energy Corp. (SE) along with Spectra Energy Partners (SEP) announced the execution of new long-term contracts for 650,000 dekatherms per day (Dth/d) of natural gas shipments on the Texas Eastern pipeline system.
The new contracts will encourage and assist the emerging manufacturing sector and liquefied natural gas (LNG) export industry along the Texas and Louisiana coast.
The customers signing contracts for long-term service include GDF Suez S.A., Mitsubishi Corporation, MMGS, Inc. (a subsidiary of Mitsui & Co., Ltd) and Range Resources Corp. (RRC).
EQT and Range Resources have inked a contract for 100,000 Dth/d and 150,000 Dth/d, respectively, expected to come online in 2016. GDF Suez S.A. has signed for 200,000 Dth/d, Mitsubishi Corporation has contracted 100,000 Dth/d and MMGS, Inc. has signed for 100,000 Dth/d, to be commissioned in 2017.
The first phase of the project, scheduled to come online in Nov 2016, will carry 250,000 Dth/d. The second phase, expected to transport another 400,000 Dth/d to these markets, will be commissioned in Sep 2017 and the project ramp-up will continue through Dec 2018.
The Gulf Markets Expansion Project supplements Spectra Energy's development efforts, which include the Team 2014 and OPEN projects. These efforts aid in transforming its Texas Eastern Transmission mainline into a bi-directional system offering diverse supply access to the Northeast, Southeast and Gulf Coast markets.
Spectra plans to deploy about $25 billion over the next decade on fee-based gas infrastructure growth projects. The company expects to commission around 8 projects through 2016. These projects are expected to add significantly to the company’s revenues and thus drive growth.
Spectra Energy carries a Zacks Rank #2 (Buy).