A joint venture led by EQT Midstream Partners has increased the overall project cost estimate of the Mountain Valley Pipeline project to $4.6bn, owing to various delays caused during its construction stage.
Image: Mountain Valley Pipeline project cost has been increased to $4.6bn. Photo: courtesy of renjith krishnan/FreeDigitalPhotos.net.
The Mountain Valley Pipeline project is a 487.6km long underground, interstate natural gas pipeline system that will be laid from northwestern West Virginia to southern Virginia.
It has been designed to deliver at least two Bcf per day of natural gas sourced from the Marcellus and Utica shale regions to the growing demand markets in the Mid-Atlantic and Southeast areas.
Mountain Valley Pipeline, the holding company of the gas pipeline project, said that almost half of the project cost increase has been driven by prolonged periods of work stoppage last month that led to changes in current contractual charges and schedule.
Extraordinary rainfall events through the summer along with recent hurricane preparedness actions have also played their part in interrupting full-construction activities, said the company. Apart from these, there were also certain unexpected construction cost overruns that have inflated the overall project cost.
In late August, the Federal Energy Regulatory Commission (FERC) allowed restart of the full construction on the Mountain Valley Pipeline project, with the exception of a 40km or so pipeline stretch along the route.
In line with the current construction plan, the project company expects to complete more than 50% of the gas pipeline by the year-end.
Mountain Valley Pipeline, in a statement, said: “The halting of construction due to court challenges from environmental opponents have caused lengthy project delays, material cost increases, and burdens for local communities and agencies; and have also impeded the delivery of low-cost energy resources to consumers and other end-user markets.”
The project company also said that in addition to the work stoppage, considerable amount of costs have been incurred to improve and repair erosion and sediment control devices due to heavy rainfall in West Virginia and Virginia in the past several months.
Despite the delays, the company said that it will target full commissioning of the Mountain Valley Pipeline project during the fourth quarter of 2019.
The natural gas pipeline project is being developed by EQT Midstream Partners, NextEra US Gas Assets, Con Edison Transmission, WGL Midstream, and RGC Midstream through the Mountain Valley Pipeline joint venture.