OREANDA-NEWS. The US Federal Energy Regulatory Commission (FERC) yesterday approved Algonquin Gas Transmission's Incremental Market (AIM) project, designed to provide 330mn cf/d (9mn m3/d) of gas to New England, one of the most constrained US markets.

Plagued with inadequate natural gas infrastructure, New England typically averages the highest natural gas prices in the US during the winter. The shale boom and subsequent prolific output from the nearby Marcellus shale have done little to provide price relief to the area during bouts of below-normal temperatures because of regional pipeline constraints.

Gas at Algonquin Citygates averaged \$23.17/mmBtu on 13 February, the highest level of the 2014-15 winter. Prices there soared as high as \$72.92/mmBtu during extremely cold weather in January 2014.

The \$972mn AIM project seeks to provide more takeaway from the Appalachian shale region while reaching constrained demand centers in the northeast, expanding the Algonquin system to boost capacity from its recipient points in Ramapo, New York, to city gate delivery points in Connecticut, Rhode Island and Massachusetts.

The project is fully subscribed, with eight local gas distribution companies and two municipal utilities contracting for capacity.

The AIM project includes the installation of 36.6 miles (59km) of pipeline ranging from six inches to 36 inches in diameter, and will add horsepower to six compressor stations along the line's path. The project also involves abandoning some obsolete facilities, constructing three new meter stations and modifying 24 meter stations.

Algonquin expects the project to begin service in November 2016.