| The Houston-based company planning a major natural gas pipeline project in Massachusetts reported Wednesday that project officials are making progress and have executed contracts with electric distribution companies in New Hampshire and Massachusetts for more than half of the project’s design capacity.
Spectra Energy Partners, which included project information in its newly released first quarter financial results, said processes required to approve the contracts are underway with state regulators and project officials expect additional contracts as processes move forward in Connecticut, Rhode Island and Maine.
The company, which is advancing expansion projects valued at $6 billion, reported first quarter distributable cash flow of $371 million, compared with $351 million in the first quarter of 2015. Spectra’s Access Northeast project covers New York, Connecticut, Rhode Island and Massachusetts.
“Spectra Energy Partners grew its earnings and distributable cash flow in the first quarter, despite the continuing weak energy sector fundamentals and a warm winter. Our results once again underline the reliability and strength of our business model,” Spectra Energy CEO Greg Ebel said in a statement.
Massachusetts lawmakers are crafting an omnibus energy bill and facing pressure from renewable energy proponents to restrain the state’s growing reliance on natural gas. Pipeline opponents in late April celebrated the announcement by Kinder Morgan that it is suspending work on its $3.3 billion Northeast Energy Direct pipeline project, citing inadequate commitments from prospective customers. During a series of rallies, including one outside the State House on Tuesday, pipeline opponents have made clear that they stand ready to fight other expansion projects, such as the Access Northeast project that Spectra is developing with Eversource Energy and National Grid.
During an earnings call Wednesday, Ebel expressed confidence in Spectra’s position, citing “ample liquidity” within the company, “strong balance sheets,” “attractive dividends” and a disciplined approach to expansion projects.
Ebel said Spectra was pleased to be working on Access Northeast with Eversource and National Grid, major players in the Massachusetts and regional energy markets. “We‘ve got great partners who know the region and give us the advantage of a very strong ground game,” Ebel said.
According to Spectra, its Access Northeast project would save $1 billion on electricity costs paid by consumers in New England and improve the energy grid‘s reliability. If the project had been in-service during the extreme 2013-2014 winter, Spectra estimates the savings could have reached $2.5 billion.
