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Behind Boardwalk Pipeline Partners’ Expansion Plans

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Jul. 3 2017, Updated 6:41 a.m. ET

Boardwalk Pipeline Partners’ expansion plans

Boardwalk Pipeline Partners (BWP) expects to spend $1.1 billion on expansion projects during the 2017–2019 period. The partnership expects to add 1.4 Bcfpd (billion cubic feet per day) of natural gas transportation capacity during the same period. BWP’s expansion projects are focused on natural gas demand growth from LNG (liquefied natural gas) exports, power utilities, and industrial demand.

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Natural gas demand projects

US LNG export capacity is expected to rise a lot in coming years, with six LNG projects under construction. BWP is bullish on the expected rise in US LNG exports. The partnership is developing the Coastal Bend Header to provide 1.4 Bcfpd of natural gas transportation service to the Freeport LNG project under long-term contracts.

Meanwhile, the partnership is developing two expansion projects on its Gulf South pipeline system. These expansion projects would feed two proposed power plants in Louisiana, which are expected to come online in 2018 and 2019.

EQT Midstream Partners (EQM), Williams Partners (WPZ), and Spectra Energy Partners (SEP) are among the midstream MLPs (master limited partnerships) that are bullish on demand-based natural gas projects.

Ethylene transportation projects

Apart from the natural gas demand projects, the partnership is pursuing several small expansion projects to provide ethane, ethylene transportation, and storage services to petrochemical customers.

According to Stan Horton, BWP’s CEO (chief executive officer), these projects “are backed by long-term fixed fee firm contracts with primarily investment grade customers and have an aggregate weighted average contract wipe of 17 years” and are “consistent with our strategy to attach more end-use markets to our system.”

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