February 1, 2019 / 3:38 PM / a year ago

Dominion delays U.S. Atlantic Coast natgas pipe, boosts costs

    Feb 1 (Reuters) - Dominion Energy Inc       said on Friday
the estimated cost of its Atlantic Coast natural gas pipeline
from West Virginia to North Carolina has risen to $7.0
billion-$7.5 billion, adding that it has delayed the expected
completion date to early 2021.
    The company said previously the project would cost an
estimated $6.5 billion-$7.0 billion, excluding financing, and be
completed in mid 2020 due to delays caused by numerous
environmental lawsuits.
    "We remain highly confident in the successful and timely
resolution of all outstanding permit issues as well as the
ultimate completion of the entire project," Dominion Chief
Executive Thomas Farrell said in the company's fourth-quarter
earnings release.                         
    He noted the company was "actively pursuing multiple paths
to resolve all outstanding permit issues including judicial,
legislative and administrative avenues."
    Earlier this week, the U.S. Fourth Circuit Court of Appeals
stayed a previous court decision against U.S. Forest Service
permits that allowed Dominion to build the Atlantic Coast
pipeline across national forests and the Appalachian Trail.
    Dominion said it expects construction could recommence on
the full 600-mile (966-kilometer) pipeline route during the
third quarter of 2019, with partial in-service in late 2020.
    When the company started work on Atlantic Coast in the
spring of 2018, Dominion said it expected the project would cost
an estimated $6.0 billion-$6.5 billion and be completed in late
    That was before the company suspended construction in early
December after the Fourth Circuit Court stayed a permit from the
U.S. Fish and Wildlife Service that authorized the pipe to be
built in areas inhabited by threatened or endangered species.
    Atlantic Coast is designed to carry 1.5 billion cubic feet
per day (bcfd) from the Marcellus and Utica shale in
Pennsylvania, Ohio and West Virginia to the U.S. Southeast.
    One billion cubic feet is enough gas to supply about 5
million U.S. homes.
    Atlantic Coast is not the only big pipeline fighting
environmental groups in court over permits.             
    EQM Midstream Partners LP         is facing similar
challenges in its quest to build the Mountain Valley gas pipe 
from West Virginia to Virginia, which is now at least $1 billion
over budget and a year behind schedule.             
    Separately, Dominion said it expects the 38-mile Supply
Header project in West Virginia and Pennsylvania, which will
feed gas into Atlantic Coast, will enter service in late 2020 at
a cost of $650 million-$700 million.
    Previously, the company said Supply Header would cost around
$500 million and enter service in late 2019.

 (Reporting by Scott DiSavino; Editing by Dan Grebler)
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