Sunoco Logistics moving ahead with second phase of Mariner East pipeline project
Sunoco Logistics Partners LP said Thursday it completed a successful open season for contracts for its Sunoco Pipeline L.P. Mariner East 2 project, receiving sufficient binding commitments from natural gas shippers to enable to the project to move forward.
Mariner East 2 is the second phase of the Philadelphia-based company’s broader plan to provide critical pipeline transportation from the Marcellus and Utica shales.
The project is designed to deliver natural gas liquids from the liquid-rich shale areas in Western Pennsylvania, West Virginia and Eastern Ohio to Sunoco Logistics’ Marcus Hook industrial complex on the Delaware River in Pennsylvania, where it will be stored and distributed to various local, domestic and international markets.
The company said it plans to invest $2.5 billion in Mariner East 2.
The project is expected to provide an initial capacity of 275,000 barrels a day of natural gas liquids such as propane, butane and ethane. Combined with Mariner East 1’s capacity of 70,000 barrels a day, the Mariner East project will provide 345,000 barrels per day of total NGL takeaway capacity from the shale regions. Sunoco said Mariner East 1 is expected to begin propane service by the end of this year.
In October, the Pennsylvania Public Utility Commission ordered additional hearings on whether to exempt the construction of buildings around pump and valve-control stations from local zoning ordinances along Mariner East 1’s 300-mile pipeline to ship natural gas liquids from Marcellus Shale wells across southern Pennsylvania.
For Mariner East 2, Sunoco Logistics said it plans to construct a pipeline from processing and fractionation complexes in Western Pennsylvania, West Virginia and Eastern Ohio for transport to the Marcus Hook industrial complex. Mariner East 2 will add a new, larger 16-inch pipeline that will parallel the existing pipeline from Houston to Marcus Hook, as well as a new 15-mile extension from Houston to the Ohio-Pennsylvania border.
Sunoco Logistics also plans to construct new facilities at the Marcus Hook complex to store, chill, process and distribute propane, butane and ethane for distribution to local, domestic and international markets, with plans to offer intrastate and interstate movements to meet the demands of various markets. Mariner East 2 is expected to be operational by the end of 2016, subject to regulatory and permit approvals.
“This vital energy project will provide a comprehensive solution in the region to transport, store and process NGLs from the Marcellus and Utica Shales, and will provide the foundation for the continuing rebirth of the local manufacturing sector,” said Michael J. Hennigan, Sunoco Logistics’ president and chief executive officer.
“The project also enables the continuing development of the Marcus Hook Industrial Complex, as we convert a former refinery site into a world-class natural gas liquids hub in southeastern Pennsylvania,” he added.
The company said it will invest about $3 billion in Pennsylvania for the Mariner East projects to provide a mechanism for moving these resources within the commonwealth. As part of this investment, the Mariner East projects will also allow for additional propane to be available for consumers in local markets during high demand periods, such as last winter, via distribution terminals at points along the line.
Sunoco Logistics said it is also actively developing the addition of an NGL manufacturing complex, including a propane dehydrogenation plant at Marcus Hook for the manufacture of propylene.