Houston (Platts)--13Dec2011/351 pm EST/2051 GMT

Houston-based company Crestwood Midstream Partners on Tuesday said it would build a 42-mile natural gas pipeline in West Virginia to move Marcellus Shale supplies in the state to downstream markets in Washington D.C. and Baltimore.

The 200,000 Mcf/d Tygart Valley pipeline project has secured Pittsburgh-based producer Mountaineer Keystone as a shipper for some 115,000 Mcf/d. The E&P company expects to begin its horizontal drilling program in Barbour, Preston and Taylor counties in West Virginia in the middle of next year, Crestwood said in a statement.

Mountaineer Keystone is a portfolio company of private investment firm First Reserve, which also manages the fund that owns Crestwood's general partner.

Article continues below...

Request a free trial of: Gas Daily
	Gas Daily offers the most detailed coverage of natural gas prices at interstate and intrastate pipeline and pooling points in major U.S. markets. Gas Daily keeps you informed about complex state and federal regulations that affect competition in the gas industry.

Meanwhile, Crestwood is marketing the remaining firm capacity in the project to area producers that have been accumulating Marcellus Shale leases, but have been slow to commence drilling and development due to a lack of pipeline infrastructure in the area, the release stated.

The $70-million pipeline, which will connect into Columbia Gas Transmission's WB pipeline in Randolph County, is expected to be completed by the fourth quarter of 2012, it said.

The line can also be expanded to around 300,000 Mcf/d with added compression, the release stated.

--Samantha Santa Maria, samantha_santa_maria@platts.com

Tweet