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STAMFORD, Conn., May 4 (UPI) -- The U.S. subsidiary of Statoil announced Tuesday it landed a deal to ship gas from the Marcellus shale play in Pennsylvania to markets in Canada.
U.S. subsidiary Statoil Natural Gas concluded a transportation agreement with National Fuel Gas Supply Co. for the rights to transport 1.1 trillion cubic feet of natural gas per year through a pipeline from Pennsylvania to the Niagara at the Canadian border with the United States.
SNG Executive Vice President Rune Bjornson said the deal is an "important move" on the Marcellus shale gas play.
"This is a further reinforcement of Statoil's gas marketing position in the United States," he added.
The transit pipeline needs additional compression and "other modifications" to reverse the flow of gas. National Fuel had supplied U.S. markets from Canada, though increasing Canadian demand coupled with declining production necessitated the change, Statoil said.
Statoil booked the capacity for Marcellus gas for 20 years. The pipeline should enter service in 2012.
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