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Supply, Marketing, Distribution, Transportation & Logistics News & Information
May 2017 Issue

Proposed Expansion of Alliance Pipeline Capacity to Chicago Market Hub

April 21, 2017 •

On March 13, the Alliance Pipeline Company announced a non-binding call for expressions of interest for additional natural gas transportation service on its pipeline system. The proposed expansion would increase capacity by up to 0.5 billion cubic feet (Bcf/d), increasing the total throughput to over 2 Bcf/d, with an anticipated start date of November 1, 2020. If Alliance determines that sufficient interest has been received, and following a feasibility study, Alliance may commence a binding open season as early as the fall of 2017.

 

Source: U.S. Energy Information Administration (EIA)

 

The 2,391-mile long Alliance pipeline moves wet natural gas (i.e., a mixture of methane and liquid hydrocarbons), primarily from Western Canada, to the Aux Sable natural gas plant liquids (NGPL) extraction and fractionation facility in Channahon, Illinois. After crossing the border in North Dakota, the 967-mile U.S. portion of the Alliance system extends southeast through Minnesota and Iowa, and ends at the Aux Sable plant.

 

Since 2010, the pipeline added two lateral lines that pick up natural gas in North Dakota: the Prairie Rose transports up to 0.12 Bcf/d of wet natural gas from the Palermo Conditioning Plant, and the Tioga lateral receives up to 0.13 Bcf/d of natural gas from the Hess Tioga gas processing plant.

 

Alliance is somewhat unusual in that it transports natural gas prior to processing, as opposed to afterwards, like most U.S. long-haul natural gas pipelines. With limited demand for NGPL in Western Canada, the original designers of the Alliance pipeline determined that it would be economically favorable for Canadian producers to transport the growing volumes of Western Canadian natural gas production to Illinois for processing and marketing rather than building processing facilities in Western Canada and shipping the liquids and dry natural gas separately.

 

Dry gas processed at Aux Sable is delivered to several major interstate natural gas pipelines, including the ANR Pipeline Company, Natural Gas Pipeline Company of America, Midwestern Gas Transmission Company and Vector Pipeline Company, for shipment to customers in Illinois, Indiana, Ohio, Michigan and Ontario, Canada. NGPL recovered at Aux Sable are delivered to market by rail, pipelines and direct connections to local refineries and petrochemical facilities.

 

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