Tuesday, July 30, 2013

New Pipeline to Double Natural Gas Available in Florida

On Friday, Sabal Trail Transmission, LLC, a joint venture between Spectra Energy Corp. and NextEra Energy, Inc., announced that it had awarded a contract to build a $3 billion, 465 mile natural gas pipeline from central Alabama to central Florida. The primary customer will be Florida Power & Light (a subsidiary of NextEra) and the gas will be used primarily for power generation.  The 1 Bcf/day pipeline, which is expected to be in service by 2017, would double the amount of natural gas flowing to Florida and allow FP&L to replace current power stations that burn coal and oil.

This is a big deal.  We've seen lots of pipelines built to transport natural gas out of the glutted producing regions, but this is a case of a new fat pipe delivering gas to an underserved consumer that will use it to displace competing power sources.

Florida is a big and growing market that has no gas production of its own and is not crisscrossed by transmission infrastructure, like most states.  If you want to get gas down the peninsula to the population base in Florida, you have to build a pipe.  And that's just what is happening.  To me, this is just as good as an LNG export facility, and it's a hell of a lot easier to permit and cheaper to build.  Another take on the route:

1 comment:

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