Williams has asked FERC to authorize an expansion of its MountainWest Overthrust Pipeline LLC system to natural gas customers in the West.
The midstream giant said it wants to add 325,000 Dth/d of westbound firm capacity to its Overthrust system by early December 2025. Supply would be delivered to southwestern Wyoming, according to an application filed with the Federal Energy Regulatory Commission.
New capacity would flow from two points in Wyoming: 320,000 Dth/d from Tallgrass Energy Partners LP’s Rockies Express Pipeline LLC (REX) at Wamsutter, and 5,000 Dth/d from Kinder Morgan Inc.’s Wyoming Interstate Co. (WIC) near Rock Springs. The project cost is estimated at around $119.6 million, Overthrust stated.
The westward flows would run to a new interconnect with the Kern River Gas Transmission Co. pipeline system via a short delivery lateral. The project would also add compression to the Rock Springs and Point of Rocks stations.
Overthrust’s 236-mile, 36-inch diameter pipeline extends from REX to interconnects with the Opal hub and two existing delivery points in Uinta County. Overthrust has peak capacity of 2.8 million Dth/d that is fully subscribed, the company said.
The new delivery point, dubbed the Wagon Wheel by Kern River, would begin shipping with the 2025-2026 winter heating season. Overthrust noted that firm capacity is held by one shipper.
With an annual contracted volume of 118 million Dth, around $20.8 million could be generated in revenue, according to Tudor, Pickering, Holt & Co. analyst Zack Van Everen.
“Although relatively smaller in scale for Williams, this project underscores their ongoing capability to expand existing assets and capitalize on the growing demand for gas,” Van Everen said.
The proposal comes a year after Williams agreed to a takeover of MountainWest Pipelines Holding Co. that included Overthrust.
Williams executives said during the 3Q2023 earnings that Overthrust was part of the company’s accelerated midstream expansions.
“This is the second piece of substantial business that we have signed up just this year on the MountainWest pipelines, and neither of these expansions were in our pro forma for this acquisition,” CEO Alan Armstrong said. “So really pleased with the team from MountainWest Pipeline and the leadership we have working to grow that business, but very pleasantly surprised with that acquisition to date.”
