Proposed electric facility to tap into Marcellus shale

BY ROBERT L. BAKER
Times Shamrock Writer

Plans are underway to establish an electricity generating facility near Nicholson that by next year will tap into the Marcellus shale gas beneath its feet and produce enough energy to power 13,000 residential homes.

In August, IMG Midstream of Yardley and Chief Oil & Gas of Dallas, Texas, announced they had entered into an agreement that calls for the construction of five electricity-generating facilities that will be fueled by Marcellus natural gas produced locally.

The one to be located off Bob Henry Road in Nicholson Twp. will be run by a firm called Oxbow Creek Energy LLC, a subsidiary of IMG Midstream.

The limited liability company was started in March in Delaware, and by May 16 was registered in Pennsylvania to render wholesale electric generation.

The company has applied for various permits with the state Department of Environmental Protection, and on Oct. 22, had an air quality plan approved.

“We are excited to construct projects that will use locally produced gas, create new local gas markets and satisfy local electricity needs,” Ron Kiecana, managing director at IMG Midstream, said.

Three of the other proposed sites are in Pennsylvania, while the fifth is in West Virginia.

Kiecena said the West Virginia site, however, is on hold.
“Currently our near term focus is the completion of our sites in Pennsylvania,” he said.

Other Pennsylvania sites are in Toby Twp., Clarion County; Auburn Twp., Susquehanna County; and Greene Twp., Greene County.

The Auburn Twp. site is just a couple of miles north of Meshoppen and will run under the corporate name, Round Top Energy LLC, a subsidiary of IMG Midstream.

Susquehanna County planner Robert Templeton acknowledged Friday he has had contact by IMG Midstream, but no formal plans for Round Top have been submitted for his county’s planning commission approval.

He said it was not unusual for companies like that to get their DEP permits in order before they work through the planning approval process.

Wyoming County planner Nicole Wooten acknowledged the same for Oxbow Creek Energy, and said in September she had received pre-application inquiries from IMG Midstream personnel.

According to its DEP filings, both the Wyoming County commissioners and the Nicholson Twp. supervisors were initially informed about the Oxbow Creek Energy project back in March.

Although it had originally hoped to be operating in August 2014, Kiecena said the target start date for construction has been changed to the summer of 2014 with total construction time projected to be 6-7 months.

The station will be built adjacent to an existing electric infrastructure on three acres of land with a physical footprint of approximately one acre.

Such facilities don’t come cheap, Kiecena acknowledged, noting that “Each 20 megawatt project will require a total investment of approximately $18 million.”

DEP’s air quality approval for Oxbow Creek Energy is for a site capable of generating as much as 18.6 megawatts.

Whose paying for it?

IMG Midstream’s website at www.ironmtngen.com acknowledges that its equity sponsor, Bregal Energy (formerly known as Good Energies Capital) is a private equity fund that invests broadly across the North American energy industry. It has corporate offices in Yardley and Pittsburgh, and also Charlotte, N.C.

Kiecena said that IMG will be working with Chief Oil & Gas and others to supply gas to its project locations.

“IMG has had discussions with all the gas suppliers in the region,” he said. “We are excited that many of these gas producers have embraced our business model and are committed to advancing the use of locally produced natural gas. Essentially, by them selling us gas, these producers (like Chief Oil & Gas) are making a re-investment in the communities where they operate.”