KMP and Energy Transfer to develop $1.3B pipeline

Kinder Morgan Energy Partners and Energy Transfer Partners have entered into a 50/50 joint venture, Fayetteville Express Pipeline (FEP), to develop a new pipeline. The 187-mile pipeline will originate in Conway County, AR, continue eastward through White County, AR, and terminate at an interconnect with Trunkline Gas Company in Quitman County, MS.

The pipeline will have an initial capacity of 2 Bcf/d. Pending necessary regulatory approvals, the approximately $1.3 billion pipeline project is expected to be in service by late 2010 or early 2011. FEP has secured binding 10-year commitments of 1.575 MMDth/d including 1.2 MMDth/d from Southwestern Energy Services, a unit of Southwestern Energy Co., and 375,000 Dth/d with an option for an additional 125,000 Dth/d from Chesapeake Energy Marketing, an affiliate of Chesapeake Energy Corp.

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