Tom Shepstone: Why The Mariner East 2 Pipeline Is Essential to Southeast PA

In a two part series last week, Tom Shepstone, of Shepstone Management Company Inc., explored the importance of the Mariner East 2 Pipeline to Southeastern Pennsylvania.  Shepstone covers not only the tremendous economic impact that the project will have for the State, but also how it will impact individual homeowners, everyday people who want to see their heating bills drop and their savings grow.

While going into detail on how the Mariner East 2 Pipeline will help to lower heating costs for homes throughout the Southeast region of the State, Shepstone quotes a recent Marcellus Drilling News piece:

“One of the primary NGLs that will flow through the ME2 is propane, used in a variety of applications, but particularly used in places where there are not natural gas pipelines to deliver gas to homes (like the various suburbs around Philly, the ones opposing ME2).

Propane prices are going up because (a) much of the propane produced by Marcellus/Utica drillers goes by railcars to Kansas, where it catches a ride on a pipeline to the Gulf Coast, and (b) the propane that does come to the Philly area also comes via rail cars, at a much higher price than if it were shipped via pipeline.”

The Mariner East projects will alleviate the issue of rising propane costs, Shepstone writes, as they’re set to “bring megatons of propane to Marcus Hook, where underground caverns already exist to hold industrial quantities of” natural gas liquids like ethane, butane, and propane, according to another Marcellus Drilling News report. Add in greater pipeline capacity will reduce the need to transport natural gas, and natural gas liquids, via rail car or trucks – not just saving money, but also moving greater quantities of this precious natural resource through a far safer means.

In the second part of Sheptsone’s series he uses the recent Econsult study as further evidence that the Mariner Projects will be a boon for Pennsylvania – and southeastern Pennsylvania in particular. While Shepstone touches on the fact that the projects will “add up to a cool $9 billion in benefits,” he emphasizes that the “real economic benefit to the region, though, is in the kinds of things [he] discussed in” the first part of his analysis, notably the increase in butane, propane, and ethane supplies for Southeastern Pennsylvania.

Quoting Chapter 5 of the Econsult study, Shepstone shows how this important infrastructure projects will benefit the region by supplying incredible quantities of these important resources. The Mariner East pipelines will make “the transport of propane in Pennsylvania more efficient, reduces transportation costs, and could help stabilize the retail price of propane in Pennsylvania,” according to the study, and they will “deliver ethane to the Competitive Power Ventures power plant in Cambria County, PA,” and will transport butane that can be “processed at the fractionation facility, and distributed from MHIC. This presents more possibilities for the Commonwealth in the petrochemical, fuel, and energy markets.”

Sheptsone closes his insightful analysis of the Mariner East projects by writing that,

“Although these parts of the Econsult study don’t include the type of quantification associated with other economic impacts, it’s clear these contributions will absolutely dwarf that $9 billion. It’s all about whether a revitalized petrochemical industry will have an opportunity to succeed in Southwest PA or not; whether Greater Philadelphia will have its chance to be the next Houston or not.”

Shepstone lays out, plain to see, why it’s so important to support the Mariner East projects. They’ll create thousands of jobs, bring billions to our economy, and improve an important aspect of our infrastructure.