New Jersey Resources (NJR) on Thursday announced its Adelphia Gateway unit is acquiring Talen Energy’s Interstate Energy Co., owner of an 84-mile former crude oil pipeline in southeast Pennsylvania, for $166 million.

Additional contingent payments of up to $23 million, based on undisclosed conditions, also are part of the purchase price, Kallanish Energy learns.

NJR’s Adelphia Gateway project will repurpose the southern 50 miles of the pipeline to flow natural gas and provide customers in the greater Philadelphia region with a new source of supply.

Once converted, the line will be able to transport an incremental 250 million cubic feet per day (MMcf/d) to the greater Philadelphia market.

“With the growing demand for clean, low-cost natural gas, Adelphia Gateway will play a pivotal role in delivering much needed supply to customers in the Philadelphia market, as well as providing value for our company and shareowners,” said Steve Westhoven, senior vice president of NJR Midstream, a subsidiary of New Jersey Resources.

The northern 34 miles of the pipeline, extending from western Bucks County to Northampton County, were converted to flow natural gas in 1996.

Originally constructed in the 1970s to transport oil, the 18-inch pipeline runs through Pennsylvania from Marcus Hook, just south of Philadelphia, north to Martins Creek, Pa.

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