Regency to extend pipeline in Louisiana

DALLAS (AP) — Natural gas processor and transporter Regency Energy Partners LP on Friday said that it, along with Alinda Capital Partners LLC and an affiliate of GE Energy Financial Services, are jointly constructing a $47 million pipeline extension of the Haynesville Expansion Project in North Louisiana.

The purpose of the extension — called the Red River Lateral — is to increase capacity to the Regency Intrastate Gas System. The project will add about 100,000 million British thermal units per day of capacity to the current project, bringing the total project capacity to about 1.2 billion cubic feet of natural gas per day.

Regency said all the incremental capacity on the Red River Lateral has been contracted and 75,000 million British thermal units per day of additional capacity on the existing Haynesville Expansion Project has been contracted as well. The expansions are underwritten by firm transportation agreements with 10-year terms, and about 85 percent of projected revenues will come from reservation fees.

The $47 million Red River Lateral will be funded by each of the partners that owns that Regency Intrastate Gas System according to their ownership percentages. Regency has a 43 percent stake, Alinda has a 50 percent interest and an affiliate of GE Energy Financial Services has a 7 percent stake.

Construction of the Red River Lateral is expected to begin this month, and is projected to be in service by the end of the year, Regency said in a statement.

Shares of Regency rose 36 cents to $17.71 in morning trading.