Spectra Energy Corporation
) share price dropped 0.3% following the news of the company's
intention to boost natural gas pipeline capacity in the New England
Market to meet the demand for reliable electric power generation,
Spectra Energy Partners
The New England governors' latest proposal on new energy
infrastructure and the expectations of a Request for Proposal to be
started by The New England States Committee on Electricity (NESCOE)
has prompted these plans for expansion of the Algonquin and
Maritimes pipeline systems.
As per the letter dated Jun 27 to NESCOE, this expansion is
expected to create a capacity of about 1 billion cubic feet per
day. This new capacity excludes Spectra Energy's earlier announced
Algonquin Incremental Market (AIM) and Atlantic Bridge projects.
The timing of NESCOE's process will influence the commissioning of
Spectra Energy will offer various services to New England such as
the supply of natural gas on peak days, new innovative services,
direct access to low-cost cost natural gas supplies, and cost
effective solutions that limit price volatility and generate annual
savings to consumers. The company will also be able to expand its
operations with the rise in demand..
The de-bottlenecking of the pipeline system, aided by the company's
Algonquin Incremental Market expansion project is expected to begin
by the winter of 2016. This will increase the reliability and
in New England. Notably, AIM has long-term capacity contract
commitments from gas utility companies across New England.
The Atlantic Bridge is scheduled for commissioning in Nov 2017 and
will be similarly supported by gas utilities. Moreover, Spectra
Energy's latest move will help in supplying the required additional
firm supplies directly to the power generators and hence, solve the
electric reliability issue.
Currently, Spectra Energy carries a Zacks Rank #3 (Hold).
Meanwhile, one could consider better-ranked players in the same
), both of which sport a Zacks Rank #1 (Strong Buy).
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