Williams gets approval to begin work on Leidy South expansion pipeline loop

Houston — Williams' Transcontinental Gas Pipe Line was given the go-ahead from US regulators on Jan. 29 to begin construction of a section of its Leidy South expansion in Pennsylvania that will allow it to provide additional incremental capacity.

The expansion is designed to connect Appalachian Basin natural gas supplies with downstream markets. Some 125 MMcf/d of capacity from the Leidy South project was brought online in November 2020, with the remaining 457 MMcf/d expected to be complete this year, according to Williams.

Beyond the peak winter heating season, Williams sees surging US LNG exports from the Atlantic and Gulf coasts as a positive sign for its transportation network.

The latest work on Leidy South approved by the Federal Energy Regulatory Commission involves the installation of 3.5 miles of 42-inch-diameter pipeline loop, called the Benton Loop, in Lycoming and Columbia counties. Williams had also sought permission to begin work on the Hensel and Hilton loops in Clinton County, but the latest approval does not cover those segments.

"Each loop will create incremental pipeline capacity which can be used by Transco to deliver natural gas for certain Leidy South shippers to the existing point of delivery provided for in their firm transportation agreements," the operator said in its request to FERC. "In addition, each of these loops will help reduce overall pressure loss throughout the Leidy Line, improving the operational reliability and flexibility of the Leidy Line."

Like Leidy South, Transco also brought a portion of the capacity from its Southeastern Trail expansion online in November 2020. It brought another portion online in December, with the remaining capacity expected to be available by the end of March.

Southeastern Trail is a transmission expansion project that also serves demand in the mid-Atlantic and southeastern US.

Williams has said it expects robust natural gas demand to further boost its US pipeline volumes and Northeast gathering and processing operations in 2021. It has forecasted that prices could incentivize more drilling in key basins and, in turn, drive higher flows on Williams' transportation network.

Williams is expected to provide financial guidance for 2021 and its outlook for growth spending when it releases its latest earnings results in February.