Independent producer Cabot Oil & Gas today said it’s signed a 10-year sales agreement to be the exclusive natural gas provider to Invenergy’s Lackawanna Energy Center power plant.
The proposed facility is a natural-gas fired 1,500-megawatt (MW), combined-cycle generating facility located in Lackawanna County, in northeast Pennsylvania.
A combined-cycle power plant uses both a gas and a steam turbine together to produce up to 50% more electricity from the same fuel than a traditional simple-cycle plant. Waste heat from the gas turbine is routed to the nearby steam turbine to generate extra power.
The facility, at maximum capacity, will burn up to 240 million cubic feet per day (MMcf/d) of natural gas, Kallanish Energy calculates. Contract value wasn’t released by Cabot. Gas will be pulled from Cabot’s numerous Marcellus Shale wells in the area.
“We are very pleased to finalize this agreement with SJI and to provide locally produced natural gas to this state-of-the-art power generation facility,” commented Dan O. Dinges, CEO of Houston, Texas-based CEO.
“Together with our previously announced agreement with SJI to supply natural gas to the Caithness Moxie Freedom project, Cabot will be providing more than 400,000 dekatherms [400 MMcf/d] of natural gas for power generation directly in our backyard.”
The Caithness Moxie Freedom Project referred to by Dinges involves construction of a 1,029 MW combined-cycle, gas-fired power plant in Luzerne County, Pennsylvania, slated to start commercial operation in 2018.
Likewise, commercial operation at the new Lackawanna facility is expected to begin in mid-2018 and to reach full power by year-end 2018.
As part of the deal, holding company South Jersey Resources Group’s South Jersey Industries (SJI) unit will become counterparty to both companies via a supply fuel management service agreement.