“The Mountain Valley Pipeline is very different from the Atlantic Coast Pipeline in that is a supplier-driven pipeline, rather than a customer-driven pipeline. That is, the entities that have entered into long-term contracts for the majority of the capacity on the Mountain Valley Pipeline are producers of natural gas.
The entities that have entered into contracts for capacity on the Mountain Valley Pipeline are all affiliates of the companies that are partners in the joint venture. The pipeline is fully subscribed. EQT is, by far, the largest shipper, as well as being the dominant partner in the joint venture to build the pipeline.
All of the shippers on the Mountain Valley Pipeline are affiliates of companies involved in developing the project. Investors in the Mountain Valley Pipeline are at greater risk of being harmed by financial problems with the shippers than investors in the Atlantic Coast Pipeline are because natural gas producers are much less financially stable than regulated utilities. According to Moody’s Investor Services, the long-term credit rating of EQT is Baa3 (the lowest investment-grade credit rating), whereas the largest shippers on the Atlantic Coast pipeline have credit ratings of A1 (Duke Energy Carolinas) and A2 (Duke Energy Progress and Dominion Virginia Electric and Power Company). In recent months, investors have grown increasingly aware of the risks of supplier-driven pipelines, like the Mountain Valley Pipeline, because of the weak financial position of many shale drilling companies.”