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Midstream Gains $1.9 Billion on Gas in the Mighty Marcellus, Utica

Northeast Pennsylvania pipeline expansion will distribute $1.9 billion in adjusted earnings almost in the middle between gathering systems and long-haul transportation, according to East Daley Capital report.

As the gas glut continues to build in the Marcellus and Utica plays of the Northeast, pipelines and other infrastructure needs are becoming perhaps even more valuable a commodity.

Capacity is currently set at 9.04 billion cubic feet per day (Bcf/d), but is expected to climb to 14.2 Bcf/d by 2020, said analysts at East Daley Capital Advisors in a new report, “Righting A Wrong – The Marcellus/Utica: Balanced on a Knife’s Edge.”

“What we really wanted to do was connect the dots between pipeline contracts and [earnings before interest, tax, depreciation and amortization] contribution for midstream companies, explained Ryan Smith, East Daley’s research director. “At the best case scenario (for the dry Marcellus acreage in Northeast Pennsylvania), the maximum growth opportunity for midstream companies in that area is $1.9 billion by 2020.”

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