Energy Transfer, Chesapeake In Pact For Haynseville Pipeline

Energy Transfer Partners L.P. (ETP) on Tuesday said it reached a deal with Chesapeake Energy Corp. (CHK) to build an interstate natural-gas pipeline to transport gas from the booming Haynseville Shale structure in Texas and Louisiana.

The "Tiger Pipeline" will cost $1 billion to $1.2 billion to build and will have an initial capacity of at least 1.25 billion cubic feet of gas a day, the companies said in a press release. The line will stretch 178 miles through the Haynseville Shale from an Energy Transfer Partners' system near Carthage, Texas, to interconnections with several interstate pipelines in Louisiana. The pipeline is expected to be in service by mid-2011.

The pact includes a 15-year commitment for Chesapeake, the biggest producer of natural gas in the U.S., for gas-transportation capacity of about 1 billion cubic feet a day.

-Mark Long, Dow Jones Newswires; [phone]; [e-mail]

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