Washington — The US Federal Energy Regulatory Commission gave final approval Tuesday to three closely related natural gas projects that together would add 685.5 miles of pipeline and 339,400 horsepower of compression capable of moving about 1.1 Bcf/d to markets in Florida and the Southeast.
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The projects include the 515.5-mile Sabal Trail Project and the Hillabee Expansion Project, which would add capacity on a Transcontinental Gas Pipe Line segment in Alabama for leased use by Sabal Trail, allowing it to access upstream gas. FERC approved the related Florida Southeast Project, extending downstream from Sabal Trail to a delivery point at Florida Power & Light's Martin Clean Energy Center near Indiantown, Florida.
The projects stem from a 2012 request for proposals by Florida Power & Light to meet the state's long-term gas needs. The Florida gas market, primarily comprised of power plants, is currently reliant on two pipelines -- Florida Gas Transmission (3.1 Bcf/d) and Gulfstream Natural Gas (1.3 Bcf/d).
Power demand in 2015 was the strongest on record for the Southeast, averaging nearly 8.8 Bcf/d, with strong deliveries to power plants in Florida driving some of that growth. As such, utilities FP&L and Duke Energy have committed to long-term contracts for capacity from the projects.
The project's path toward approval at FERC was marked by strong opposition from environmentalists and some landowners who raised questions about the route through sensitive karst topography, the impact on hundreds of acres of wetlands, and questions on the need for the project.
FERC generally found those concerns had been adequately addressed and that the projects should benefit other pipelines and their customers, reduce chances of supply disruption and enhance competition.
It did find fault with one key aspect of the proposal, the provision under Sabal Trail's proposal to lease capacity from Hillabee that would restrict where Sabal Trail and its shippers could receive or deliver gas and prevent them from backhauling or reversing flow from east to west on the Transco main line.
FERC found the restrictions to be "anticompetitive" and required the companies to revise the capacity lease agreement to remove them.
FERC found the need for the projects was sufficiently demonstrated by the long-term contracts inked -- FP&L will take 93% of the capacity on Sabal Trail under a 25-year precedent agreement and 62.5% of the Florida Southeast Project capacity.
The agency found FP&L had identified a need the existing Gulfstream and Florida Gas Transmission pipelines, and any expansion of them, would not meet.
It also found that impacts on landowners and communities had been minimized by the percentage of pipeline routed through existing rights of way or previously disturbed corridors -- 60% of the route or 308.1 miles in the case of Sabal Trail, and 81% or 101.9 miles in the case of Florida Southeast.
Sabal Trail, a joint venture of Spectra Energy, NextEra Energy and Duke Energy, would take gas from Transco Compressor Station 85, across Alabama, and Georgia, and bring about 1.1 Bcf/d of gas to the Florida market. The project will be built in three phases, the first by May 1, 2017 would bring 830 MMcf/d of capacity online; the second phase by May 2020 would add 169 MMcf/d of capacity, and the third by May 2021 would add 76 MMcf/d.
Williams' Hillabee project would expand Transco's current pipeline capacity in Alabama, also in three phases, adding 43.5 miles of 42-inch- and 48-inch-diameter looping pipeline in eight segments, and 88,500 hp of compression at one new and three existing compression stations in Alabama.
The Florida Southeast Project would add 126.4 miles of 36-inch- and 30-inch-diameter pipeline in Florida. It will connect Sabal Trail at the Central Florida Hub and provide up to 640,000 Dt/d of firm service.