Environment
4:59 pm
Thu February 20, 2014

Bluegrass Pipeline Delayed at Least a Year Because of Slower-Than-Expected Commitments

Plans for a controversial natural gas liquids pipeline across Kentucky are being pushed back a year.  

The proposed Bluegrass Pipeline was originally supposed to be finished by late next year, and be in service to ship natural gas liquids, or NGLs, from drilling operations in the Northeast to the Gulf of Mexico. The plan includes 500 miles of new pipeline across Kentucky and Ohio, and has drawn opposition from landowners worried about safety and environmental contamination.

Now, the CEO of pipeline company Williams says if the Bluegrass Pipeline is built, the project probably won’t be finished until mid to late 2016.

In a conference call, Williams CEO Alan Armstrong told analysts that it’s taking more time than expected to get producers to make such a large, long-term commitment to the Bluegrass Pipeline.

“I think as I mentioned, a lot of our customers see this opportunity just like we do, that it is essential and it's an essential piece of infrastructure,” he said. “And I think some folks would just like to see somebody else get it built and hopefully be on the coat tails of that. But frankly, we're going to have to see an adequate amount of financial support before we push through with additional investment.”

Williams announced the open season for the Bluegrass Pipeline last October; this is the time where companies commit to sending their products through the pipeline. The open season was originally supposed to end in mid-December, but the company extended it to mid-January.

There’s also still the question of whether there’s enough demand for both the Bluegrass Pipeline, and the planned conversion of the Tennessee Gas Pipeline to carry NGLs. In interviews last year, a Williams spokesman said the company was confident there was enough demand, but a spokesman for Tennessee Gas Pipeline company MarkWest said he thought just one pipeline would be needed.