DTE Energy Corp.DTE announced that the Ontario Energy Board has approved applications from Union Gas Ltd. and Enbridge Gas Distribution Inc. for 15-year contracts. The approval is an important regulatory step forward for the $2 billion NEXUS pipeline, its developers as well as its gas customers. Union Gas is a subsidiary of Spectra Energy Corp. SE .
The applications were for the shipment of natural gas from the Appalachian Basin into the Union Gas Dawn Hub on the proposed NEXUS Gas Transmission system beginning Nov 2017.
The NEXUS project - a joint venture between DTE Energy and Spectra Energy - involves the construction of a 255-mile interstate natural gas transmission pipeline that will be able to ship up to 1.5 billion cubic feet per day. This is enough to power about 6 million houses and will run through northern Stark, southern Summit, the northeast corner of Wayne and across Medina County.
A direct transportation connection between Ontario and the Appalachian Basin is a major opportunity that will provide low cost supplies to Ontario's growing market. Plus, the NEXUS project will provide increased natural gas supply diversity, security and reliability to other customers in Ohio, Michigan and Chicago, the company said.
The pipeline is yet to get the approval of the Federal Energy Regulatory Commission. It is expected to rule on the pipeline in late 2016.
According to DTE Energy, "a number of industrial facilities and power generators in these areas have also recently signed interconnect agreements with the project. By expanding access to natural gas in these markets, NEXUS will provide consumers across the region with affordable, clean-burning and abundant natural gas to help meet the growing demand for cleaner power generation, industrial and commercial use, and home heating."
DTE Energy carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the power sector are Korean Electric Power KEP and Consolidated Edison, Inc. ED . While Korean Electric sports a Zacks Rank #1 (Strong Buy), Consolidated Edison carries a Zacks Rank #2 (Buy).
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