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Williams expects revenues from Atlantic Sunrise project by September

Williams Cos. Inc. expects strong future growth from 2017 natural gas infrastructure projects, including the Marcellus-linked Atlantic Sunrise pipeline project, President and CEO Alan Armstrong said.

Speaking on the company's second-quarter earnings call Aug. 3, Armstrong estimated that Williams could collect revenues from subsidiary Transcontinental Gas Pipe Line Co. LLC's Atlantic Sunrise project as early as September, even though the entire project is not expected in service until mid-2018 if regulatory approvals come in on time.

The regulatory approvals include three pending permits on water quality, including a Clean Water Act Section 404 from the U.S. Army Corps of Engineers and Section 102 and 105 permits from the Pennsylvania Department of Environmental Protection. Once the permits are issued, Transco will ask for authorization to proceed with full construction from Federal Energy Regulatory Commission staff.

"We're pretty optimistic we're going to receive those permits here in the month of August," Williams COO Micheal Dunn said.

Armstrong pointed out that even though the entire project might not be ready for service prior to mid-2018, the majority of the takeaway capacity could be available sooner with the completion of the Pennsylvania portion of the pipeline. "That's really going to be a big game changer in the area," Armstrong said.

Williams is looking beyond Atlantic Sunrise. The company is holding a binding open season for the Southeastern Trail project. "We've got ... a lot of demand for it from the market," Armstrong said. "We want to make sure that we get the very best investments" since the incremental capacity southbound on Williams' mainline "is extremely valuable," he said.

Armstrong put the focus on Williams' project execution. Six different projects, costing about $1.4 billion, have approached completion or been placed in service during the last 12 months. The 1.2-Bcf/d Gulf Trace expansion project came online in the first quarter of 2017, the 0.8-Bcf/d Hillabee Phase I project in early July, and the 0.4-Bcf/d Dalton expansion project Aug. 1. The company estimated in-service dates in the second half of 2017 for the New York Bay, Virginia Southside II and Garden State Phase I projects.

Armstrong also pointed to Williams' moves toward streamlining its services, specifically the sale of Geismar to NOVA Chemicals and the sale of Canadian assets. Williams on Aug. 2 reported second-quarter adjusted EBITDA of $1.1 billion, an increase from the second quarter of 2016 that included $18 million more in fee-based revenues from Williams Partners LP and a $24 million increase in proportional EBITDA of joint ventures.