Sunoco approved to restart US Mariner East NGL pipeline

Source: ICIS News


HOUSTON (ICIS)--Pennsylvania state regulators on Thursday gave the go-ahead for service to resume on the Mariner East 1 (ME1) natural gas liquids (NGL) pipeline.

Sunoco can resume service on the pipeline once the order from the regulator has been served to all parties, said Nils Hagen-Frederiksen, communications director for the Pennsylvania Public Utilities Commission (PUC).  “The order, based on today’s motion, is currently being drafted.”

The pipeline was ordered shut by an administrative-law judge in late May.

US Energy Transfer Partners (ETP) operates the line through its subsidiary, Sunoco Logistics. It ships 72,000 bbl/day of NGLs from the gas fields in western Pennsylvania to the Marcus Hook terminal Philadelphia.

The PUC suspended operations on ME1 on 7 March after the PUC’s Bureau of Investigation and Enforcement (BIE) found that sinkholes were apparently developed as a result of Mariner East 2 (ME2) and Mariner East 2X (ME2X) construction.

These two pipelines would allow more NGLs to be shipped to Marcus Hook.

Construction was halted on ME2 and ME2X in West Whiteland township, and the PUC upheld the injunction that suspended it.

The resumption of service on ME1 has brought down ethane pricing in the US Gulf Coast (USG), which surged to a four-year high as exporters had to pull barrels from the Mont Belvieu, Texas, market to make up for the lost supply on the East Coast.

USG ethane spot prices were trading at 32.25-32.50 cents/gal FOB (free on board) Mont Belvieu, brokers said on Thursday morning. This down from a high of 34 cents/gal on Wednesday.

Photo above shows packaging made from polyethylene (PE). Much of the PE made in the US is derived from ethane. Photo by Al Greenwood