Winter has arrived with a vengeance across the eastern US. A series of storms has ignited heating demand and increased flows on expanded segments of Williams’ (WMB) Transcontinental Gas Pipeline, including the newly started Southside Reliability Enhancement (SRE) project.
WMB placed the SRE expansion into full service on December 30, 2024. SRE expands capacity in southern Virginia by 423,000 Dth/d from Compressor Station 165 through Transco’s South Virginia Lateral. Local utility Piedmont Natural Gas has contracted for the expansion, providing the shipper with firm capacity instead of relying on uncertain interruptible service.
In the WMB Financial Blueprint, East Daley Analytics estimates that SRE will contribute $32MM in annual EBITDA. Although the physical flows through the expansion will vary by season, the long-term contract will generate consistent revenue for Williams.
Following the SRE project in-service, flows through Transco’s Compressor Station 167 jumped to new daily highs. The highest throughput before the project was ~660 MMcf/d, but flows reached over 800 MMcf/d last week (Jan 5-11) as a winter storm hit the Mid-Atlantic (see figure). The immediate fill of the expansion demonstrates the value of new capacity in the Atlantic region during periods of peak winter demand.
Further north on the Transco system, EDA has reviewed flows associated with the Regional Energy Access (REA) expansion. About half of the 829,400 Dth/d project entered service in October ’23 at the start of the 2023-24 heating season, and Station 515 on the Leidy line saw record flow of 2.65 Bcf/d. The second phase entered service in July ‘24, and the Station 515 meter posted a new high of 2.69 Bcf/d in early January ‘25.
The immediate fill of the Transco projects show their value when winter demand peaks on the East Coast. WMB has a lengthy docket of Transco projects and will look to continue its successful execution on Texas to Louisiana Energy Pathway (1Q25), Southeast Energy Connector (2Q25), Commonwealth Energy Connector (4Q25), Alabama Georgia Connector (4Q25), and Gillis West (4Q25). All of these projects are slated to enter service in 2025. – Zach Krause Tickers: WMB.
Request the Dirty Little Secrets 2025 Written Report
A full written report will be available in January for the 2025 Dirty Little Secrets. This report will go beyond the webinar discussions to provide a deeper analysis of the topics covered. Learn how commodities are intertwined and identify opportunities for profit from market dislocations. Request a copy of the Dirty Little Secrets report.
The Daley Note
Subscribe to The Daley Note (TDN) for midstream insights delivered daily to your inbox. The Daley Note covers news, commodity prices, security prices and EDA research likely to affect markets in the short term.