Investors drop out of Colorado pipeline project
December 30, 2008
DENVER ” The credit crunch has prompted some investors to withdraw from construction of a natural gas pipeline in northwestern Colorado.
Enterprise Products Partners and Quicksilver Gas Services have terminated plans for a 50 percent stake in TransCanada’s $2 billion Pathfinder pipeline project. The 673-mile pipeline would run from Colorado to North Dakota where it would link to a major system in the Midwest.
Quicksilver Gas Services, based in Fort Worth, Texas, decided in August that it wouldn’t pursue the project, spokesman Rick Buterbaugh said Tuesday.
“We think it’s a great project,” Buterbaugh said of the pipeline.
Quicksilver Gas Services, though, is exploring other opportunities, he added.
TransCanada, based in Calgary, Alberta, said it’s working with prospective investors to carry out the project.
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Enterprise spokesman Rick Rainey told The Denver Post Monday that considering current credit markets, the Houston-based company is pursuing projects with better returns.
Plans call for the pipeline to initially ship 1.2 billion cubic feet of gas per day, with an ultimate capacity of 1.6 billion cubic feet per day. Completion of construction is projected for November 2010.
“I think any pipeline expansion in the next year and a half that has not been committed is going to be a difficult sell in this current credit and price environment,” said John Harpole of Mercator Energy, a Denver-area natural gas consulting compay.
A shortage of pipeline capacity in the Rockies is one of the reasons companies are scaling back drilling in the region.