Kinder Morgan Pulls the Plug on Proposed Natural Gas Pipeline

Apr 20, 2016

Natural gas pipeline developer Kinder Morgan says it has "suspended" its plans to develop a major natural gas pipeline along the southern border of New Hampshire.

A statement from the company says the decision to pull the plug on the Northeast Energy Direct pipeline, or NED, is due to "inadequate capacity commitments" which is to say not enough customers signing up for gas.

“There are currently neither sufficient volumes, nor a reasonable expectation of securing them, to proceed with the project as it is currently configured,” the statement reads.

Natural gas pipelines are typically funded by long term contracts from local heating utilities. But the Texas-based pipeline developer was banking on natural gas fired power plants signing up for gas as well. Those contracts never materialized.

Though several New England states are currently working to develop a framework to allow electric companies to buy space on natural gas pipelines, no rules guiding that process have been finalized.

Kinder Morgan says, "given these market conditions, continuing to develop the project is not an acceptable use of shareholder funds."

The proposed project would have extended from Wright, NY, to Dracut, Mass. More than 70 miles of the pipeline, as well as an 80,000 horsepower compressor station, would have been located in southern New Hampshire.

The state's elected officials were quick to respond to the announcement. A statement from Senator Kelly Ayotte's office notes she opposed the project because "of the many unanswered questions" and says she is "pleased with today's announcement."