WILLIAMSVILLE, N.Y.--(BUSINESS WIRE)--
National Fuel Gas Company (NYSE:NFG) (“National Fuel” or the “Company”)
today provided a schedule update on the Northern Access 2016 (“Northern
Access”) pipeline expansion project and certain first quarter fiscal
2017 production results.
Northern Access Project Update
The Company and its wholly owned pipeline and storage subsidiaries
National Fuel Gas Supply Corporation (“Supply”) and Empire Pipeline,
Inc. (“Empire”), are revising the anticipated in-service date of the
Northern Access pipeline expansion project from November 2017 to the
second quarter of the Company’s 2018 fiscal year. Ongoing delays in the
regulatory approval process, including the issuance of the project’s
Certificate by the Federal Energy Regulatory Commission (“FERC”), have
limited the ability of Supply and Empire to commence certain development
activities along portions of the 99 mile pipeline route in advance of
designated environmental protection periods that begin on April 1, 2017
and extend through the end of July 2017.
In view of the delay at FERC, on January 23, 2017, Supply and Empire
agreed with the New York State Department of Environmental Conservation
(“NYSDEC”) to extend the NYSDEC’s deadline for a decision with respect
to various permits for the project, including the Section 401 Water
Quality Certification, from March 1, 2017 to April 7, 2017. The NYSDEC
has provided Supply and Empire “Notices of Complete Application” for the
various project permits and is expected to publish those notices on
January 25, 2017, and move forward with the permitting process.
Ronald J. Tanski, President and Chief Executive Officer of National Fuel
Gas Company, stated: “We continue to make progress working through the
various federal, state, and local regulatory processes. Progress is
slower than we had originally anticipated, as a number of energy
projects in the northeast U.S. have faced similar permitting delays. We
are encouraged that the NYSDEC has reviewed the voluminous material that
we have submitted at their request and determined our permit
applications to be complete. We stand ready to invest close to half a
billion dollars in this infrastructure project that will increase the
tax base of our local communities and school districts and bolster our
pipeline system’s access to plentiful supplies of domestic natural gas.”
First Quarter Fiscal 2017 Production Results
Seneca Resources Corporation (“Seneca”), the wholly-owned exploration
and production subsidiary of the Company, reported net production
volumes for the fiscal year’s first quarter ended December 31, 2016, of
44.9 billion cubic feet equivalent (“Bcfe”), an increase of 6.8 Bcfe, or
18 percent, versus the prior fiscal year’s first quarter, due to higher
natural gas production in Appalachia. Seneca produced 40.6 Bcf of
natural gas during the quarter, an increase of 7.0 Bcf or 21 percent
versus the prior year. Seneca’s oil production was 721 thousand barrels
(“Mbbls”), down 27 Mbbls or 4 percent from the prior year.
An improvement in local natural gas pricing in Pennsylvania allowed
Seneca to sell more production volumes in the daily spot markets and
enter into additional seasonal firm sales agreements this winter. The
increase in Seneca’s gross Appalachian natural gas production, which
includes production from joint development wells, helped drive higher
volumes on the Company’s gathering systems. The Company’s gathering
segment transported 50.6 Bcf on its systems in the first quarter, up
16.8 Bcf or 50 percent from the prior year first quarter.
Seneca's average realized natural gas price, after the impact of
hedging, for the first quarter was $2.97 per thousand cubic feet
("Mcf"), a decrease of $0.19 per Mcf versus the prior year. Seneca's
average realized oil price, after the impact of hedging, was $54.71 per
barrel ("Bbl"), a decrease of $5.05 per Bbl.
The Company will provide additional detailed financial data in its first
quarter earnings release, which is scheduled to be issued after the
close of business on February 2, 2017.
National Fuel is a diversified energy company headquartered in Western
New York that operates an integrated collection of natural gas and oil
assets across five business segments: Exploration & Production, Pipeline
& Storage, Gathering, Utility, and Energy Marketing. Additional
information about National Fuel is available at www.nationalfuelgas.com.
Certain statements contained herein, including statements identified by
the use of the words “anticipates,” “estimates,” “expects,” “forecasts,”
“intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,”
“may” and similar expressions, and statements which are other than
statements of historical facts, are “forward-looking statements” as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve risks and uncertainties, which could
cause actual results or outcomes to differ materially from those
expressed in the forward-looking statements. The Company’s expectations,
beliefs and projections contained herein are expressed in good faith and
are believed to have a reasonable basis, but there can be no assurance
that such expectations, beliefs or projections will result or be
achieved or accomplished. In addition to other factors, the following
are important factors that could cause actual results to differ
materially from those discussed in the forward-looking statements:
delays or changes in costs or plans with respect to Company projects or
related projects of other companies, including difficulties or delays in
obtaining necessary governmental approvals, permits or orders or in
obtaining the cooperation of interconnecting facility operators;
governmental/regulatory actions, initiatives and proceedings, including
those involving rate cases (which address, among other things, target
rates of return, rate design and retained natural gas),
environmental/safety requirements, affiliate relationships, industry
structure, and franchise renewal; changes in laws, regulations or
judicial interpretations to which the Company is subject, including
those involving derivatives, taxes, safety, employment, climate change,
other environmental matters, real property, and exploration and
production activities such as hydraulic fracturing; impairments under
the SEC’s full cost ceiling test for natural gas and oil reserves;
changes in the price of natural gas or oil; financial and economic
conditions, including the availability of credit, and occurrences
affecting the Company’s ability to obtain financing on acceptable terms
for working capital, capital expenditures and other investments,
including any downgrades in the Company’s credit ratings and changes in
interest rates and other capital market conditions; factors affecting
the Company’s ability to successfully identify, drill for and produce
economically viable natural gas and oil reserves, including among others
geology, lease availability, title disputes, weather conditions,
shortages, delays or unavailability of equipment and services required
in drilling operations, insufficient gathering, processing and
transportation capacity, the need to obtain governmental approvals and
permits, and compliance with environmental laws and regulations;
increasing health care costs and the resulting effect on health
insurance premiums and on the obligation to provide other
post-retirement benefits; changes in price differentials between similar
quantities of natural gas or oil sold at different geographic locations,
and the effect of such changes on commodity production, revenues and
demand for pipeline transportation capacity to or from such locations;
other changes in price differentials between similar quantities of
natural gas or oil having different quality, heating value, hydrocarbon
mix or delivery date; the cost and effects of legal and administrative
claims against the Company or activist shareholder campaigns to effect
changes at the Company; uncertainty of oil and gas reserve estimates;
significant differences between the Company’s projected and actual
production levels for natural gas or oil; changes in demographic
patterns and weather conditions; changes in the availability, price or
accounting treatment of derivative financial instruments; changes in
economic conditions, including global, national or regional recessions,
and their effect on the demand for, and customers’ ability to pay for,
the Company’s products and services; the creditworthiness or performance
of the Company’s key suppliers, customers and counterparties; economic
disruptions or uninsured losses resulting from major accidents, fires,
severe weather, natural disasters, terrorist activities, acts of war,
cyber attacks or pest infestation; significant differences between the
Company’s projected and actual capital expenditures and operating
expenses; changes in laws, actuarial assumptions, the interest rate
environment and the return on plan/trust assets related to the Company’s
pension and other post-retirement benefits, which can affect future
funding obligations and costs and plan liabilities; or increasing costs
of insurance, changes in coverage and the ability to obtain insurance.
The Company disclaims any obligation to update any forward-looking
statements to reflect events or circumstances after the date thereof.
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Source: National Fuel Gas Company