As more natural gas comes from the Marcellus shale, corporations are capitalizing on low prices with a proliferation of pipelines in New Jersey, experts say.
More than a dozen New Jersey pipeline projects have been in service, under construction or waiting for approval at the state or federal level in the past 12 months.
Increased natural gas supply and low prices have led to more pipelines nationwide, experts said.
But opponents and environmentalists worry about the long-term implications of extracting and burning the fossil fuel, as well as the pipelines’ effects on both the environment and the landscape.
Experts expect modest growth in pipelines in the next several years before demand slows.
“The pace of industrial growth after 2020 should cut in about half,” said Sam Andrus, senior director of North American gas service for IHS Inc., a Colorado-based information and analysis company. “So what that means is we expect to see a significant slowdown after 2020, from an exploration and production standpoint. And from a pipeline standpoint, that will slow as demand slows.”
Doug O’Malley, president of Environment New Jersey, wonders when these projects will stop.
“This isn’t about one pipeline at this point,” O’Malley said. “This is about whether we’re going to allow pipelines to be built unfettered.”
O’Malley believes the influx of projects is a sign of corporations attempting to move customers toward a fuel that may become costlier than it is today: “To build gas infrastructure now when prices are low, so consumers will be on the hook when they inevitably rise.”
Pipeline transportation is a $27 billion industry in the United States, according to IHS.
It’s becoming a big one in New Jersey, too.
The Cape Atlantic Reliability Project will serve the B.L. England plant in Upper Township while feeding natural gas throughout Cape May and Atlantic counties. The pipeline would stretch 22 miles from Maurice River Township in Cumberland County to B.L. England and includes a 10-mile route through protected Pinelands. The cost will be upward of $100 million, according to Folsom-based South Jersey Industries, parent company of South Jersey Gas.
New Jersey Natural Gas’ Southern Reliability Link, which will stretch 30 miles and serve three counties, including Ocean County, is projected at $178 million.
And the PennEast Pipeline, a 118-mile project that stretches from Luzerne County in northeast Pennsylvania to Mercer County, is estimated at a $1 billion total investment. South Jersey Industries is a 20 percent partner in the project as well.
“This is what’s going on in New Jersey and other Northeastern states that want to tap into production sites with the PennEast Pipeline,” said Darryle Ulama, industry lead analyst at research firm IBISWorld. “Even with higher utilization of existing pipelines, new construction is necessary to open up new delivery channels and expand transport capacity.”
Andrus said the current pipeline surge should remain modest through 2025, and that building a pipeline offers “a lot of capacity in one shot.”
He expects natural gas consumption to rise significantly over the next two decades.
“The pipeline capacity has to be built to service the market,” Andrus said.
Marissa Travaline, director of stakeholder relations for South Jersey Industries, believes lower cost and the reliability of natural gas will continue to drive customers toward the fuel.
“We believe that the cost effectiveness of this fuel choice and our proximity to an abundant domestic supply within the Marcellus and other shale formations can provide our region with significant benefits,” Travaline said.
But there has been criticism of the use of natural gas and the growth in the number of pipelines throughout the United States.
In South Jersey, one of the biggest objections has been the B.L. England pipeline. In December, the state Board of Public Utilities voted to allow the project to proceed without oversight by local zoning boards. It voted three previous times on the issues of its construction, its safety for residents and rerouting of an interconnection station for the project.
Natural gas also has been criticized for the dangers of fracking, or hydraulic fracturing — the process of drilling down for miles into the rock, then drilling horizontally and applying pressure until the rock is cracked. This can sometimes lead to water and air pollution and can be detrimental to the areas of the drilling, according to the U.S. Environmental Protection Agency.
Travaline said South Jersey Gas has worked in consultation with the BPU in maintaining an environmentally safe operation for the Cape Atlantic Reliability project.
“There will be no forest clearing or impact to the Pinelands,” Travaline said.
New Jersey Natural Gas spokesman Michael Kinney said the company’s project, the Southern Reliability Link, will provide resiliency to their customers.
Kinney said 85 percent of the company’s peak day supply of gas comes from a single interstate pipeline.
“The SRL would provide a feed to a second interstate pipeline at the southern end of our system,” he said.
Delaware Township Citizens Against the Pipeline 