Kinder Morgan Energy Partners, L.P. (KMP) and Energy Transfer Partners, L.P. (ETP) on Oct. 1, 2008, announced their formation of a 50/50 joint venture, Fayetteville Express Pipeline, LLC (FEP). The JV plans to build a new gas pipeline to support growing production from the Fayetteville Shale play in Arkansas.

The approximately 185-mile pipeline will originate in Conway County, Ark., continue eastward through White County, Ark., and terminate at an interconnect with Trunkline Gas Co. in Panola County, Miss. The pipeline will have an initial capacity of 2.0 billion cubic feet per day. Pending necessary regulatory approvals, the approximately $1.3 billion pipeline project is expected to be in service by late 2010 or early 2011. FEP has secured binding 10-year commitments totaling 1.575 million dekatherms per day (dth/day), including 1.2 million dth/day from Southwestern Energy Services, a wholly owned subsidiary of Southwestern Energy Co., and 375,000 dth/day with an option for an additional 125,000 dth/day from Chesapeake Energy Marketing, Inc., an affiliate of Chesapeake Energy Corp.

According to the JV, the new pipeline will also interconnect with Natural Gas Pipeline Co. of America (NGPL) in White County, Ark., Texas Gas Transmission in Coahoma County, Miss., and ANR Pipeline Co. in Quitman County, Miss. NGPL is operated and partially owned by Knight, Inc. Knight owns the general partner of KMP.

"The FEP project will provide shippers in the Arkansas Fayetteville Shale with much needed takeaway capacity, flexibility and access to markets," said Lee Hanse, Senior Vice - President of Energy Transfer, in the JV's Oct. 1, 2008, project announcement.

Depending on shipper support during the open season (Oct. 8-Nov. 7, 2008), capacity on the proposed pipeline may be increased.