The natural gas that is used by customers in Michigan begins its journey far under the ground in gas and oil fields located primarily in Michigan's lower peninsula, the Texas-Oklahoma Panhandle, on and off-shore Louisiana, and Alberta, Canada (see Gas Pipeline map at EIA). High-pressure transmission pipelines are used to transport the gas to Michigan natural gas distribution utilities who then deliver the gas to Michigan customers.
These pipelines are generally large diameter, and operate at high pressures, as high as 1,000 pounds per square inch (6,897 kPa). Modern gas pipelines are as large as 42 inches (1.1 meters) in diameter, with up to 5/8 inch (1.6 cm) wall thickness using steel capable of being stressed to 70,000 psi (482,759 kPa). In order to maintain sufficient pressure to move the gas to market, compressor stations are placed along the lines. The engines driving the compressors are generally gas burning, using a small percentage of the gas passing through the station to compress gas coming into the station to a higher outlet pressure. Gas moving from Oklahoma or Louisiana to Michigan requires about 4-6%, while gas moving from Alberta, Canada (which is farther away) requires up to 8% for fuel. The pipelines and related facilities are built and maintained in accordance with the Minimum Federal Safety Standards which are promulgated and enforced by the Office of Pipeline Safety within the US Department of Transportation.
High pressure transmission pipelines also bring Michigan produced gas to market. When the interstate pipelines were first built to Michigan in the 1940's and 1950's, they did not need to be built to every town. Many Michigan utilities already had transmission lines that extended to gas producing fields or other Michigan towns. By connecting to utility transmission systems, the utilities were later able to take advantage of competition in the interstate gas market by swinging their purchases between competing pipelines (see, for example, EIA report Deliverability on the Interstate Natural Gas Pipeline System available at EIA).
Natural gas utilities in Michigan currently purchase their gas supplies from various sellers at the source of the interstate pipelines, and pay the pipelines solely to transport their gas (see pipeline Tariff Books). This allows the utilities to enter into shorter contract terms for gas supply, and improves competition.
The first natural gas imported to Michigan was via Northwestern Ohio Gas Company, which brought gas to Detroit from gas fields around Findlay, Ohio in 1889. This lasted until 1893, when the fields were too depleted to maintain pressure to move the gas to Detroit. In 1894, natural gas was imported from Ontario, Canada to Detroit until those fields lost pressure in 1902.
The first interstate gas to be imported to Michigan on a sustaining basis was imported by Panhandle Eastern Pipe Line Company in 1936, which delivered gas from Oklahoma and Texas to Detroit. At 1,200 miles (1,931 kilometers) long, it was the longest pipeline in existence. According to Panhandle, when it started building this pipeline in 1930, its order for steel pipe was the largest single steel purchase ever made from the U.S. steel industry. Improvements in technology, such as electric welding which joins high-carbon steel (capable of being stressed to 37,000 psig (255,172 kPa) and machines capable of laying heavier and larger diameter pipe, now allowed for economical long distance transmission pipelines. Pipelines built then were up to 20 inches (0.5 meters) in diameter and could operate with natural gas at internal pressures of 500 pounds per square inch (3,448 kPa). Each decade after brought larger, higher pressure pipelines and new interstate gas pipeline companies to Michigan.
The 1950's and 60's were high growth periods for natural gas consumption in Michigan.Pipelines could not be built fast enough to meet demand. Michigan Wisconsin PipelineCompany began delivering gas to Michigan in 1949 (now ANR Pipeline Company),Trunkline Gas Company in 1960, Northern Natural Gas Company in 1966, Great Lakes Gas Transmission Company in 1967 and Vector Pipeline Company in 2000. Each newpipeline was a significant project costing $100's of millions. Customer utilities entered into long-term (typically 20 years) contracts to purchase gas from interstate pipelines under terms and rates that were decided by the Federal Power Commission, now the Federal Energy Regulatory Commission in Washington, D.C.
The large diameter pipelines supplied enough gas to completely displace manufactured gas. Many Michigan cities still maintained and used manufactured gas as a supplemental supply because Michigan produced natural gas was not sufficient to meet demand and its productive life was unknown. The last dates that Michigan cities supplied manufactured gas generally coincide with commencement of deliveries of natural gas via these interstate pipeline companies. Today, about 80 percent of Michigan's annual natural gas requirements are met with gas transported to Michigan by interstate pipeline companies.