Seneca had a great quarter with production up nearly 50% on the strength of last year's acquisition and its 2021 drilling program.
That growth in production, along with higher commodity prices, drove nearly 70% increase in EBITDA from our combining Upstream and Gathering operations.
This will allow us to more fully utilize our Leidy South capacity from the start and capture some of the valuable winter premiums in the Transco Zone 6 market.
Almost 90% of the pipe has been strung on the right away and nearly 40% is in the ground.
It increases revenues on our regulated pipelines by $50 million a year and when combined with Seneca capacity [Phonetic] on Transco's companion Leidy South project will allow for higher E&P production volumes and gathering throughput; the perfect example of the power of our integrated approach to the business and positions National Fuel to deliver solid near-term growth and sustainable free cash flow.
Consistent with prior years, our goal is to replace 150 miles of older pipeline, and the team is right on track to hit that mark.
To-date, our program has been the driver of a 64% reduction in emissions from our delivery system compared to 1990 levels.
Looking to next year on the strength of the FM100 project, our preliminary guidance for fiscal 2022 is $4.40 per share to $4.80 per share and to mid-point a 12% increase from our expected 2021 earnings.
In addition NYMEX pricing of $3.50, we expect about $250 million in free cash flow, which is well in excess of our expected dividend payments and which positions us well to continue to improve our investment grade balance sheet.
The goal of that program is to be between 50% and 80% [Indecipherable] at the beginning of a fiscal year, and we typically layer in those hedges over the preceding three to five years.
Every $0.25 change in realized prices impacts cash flows by about $20 million and earnings by about $0.15 per share.
Switching gears, as we all know, natural gas has been a significant, if not the biggest driver of greenhouse gas emissions reductions since 2005.
We're also enhancing our emissions disclosures to include full Scope 1 and 2 CO2 and methane emissions.
We produced 83.1 Bcfe, an almost 50% increase from last year, driven by increased Tioga County volumes from our acquisition, which closed in late July 2020, combined with solid results from our Appalachian development program.
We continued to see the benefits of our increased scale with per unit cash operating expenses dropping $0.06 per Mcfe versus the prior year to a $1.13 per Mcfe driven by a significant year-over-year decrease in our per unit G&A expense.
During the quarter, we drilled 12 new wells, five in the WDA and another seven in the EDA.
Further, given the contiguous nature of this acreage and continued operational success, we expect most of our Tioga Utica Wells will exceed 10,000 feet treated lateral link generating outstanding returns.
Seneca holds a 25% working interest in this pad.
However, 100% of the production will flow through National Fuel's wholly owned gathering system, driving throughput growth and revenues for our sister company.
Moving to fiscal 2022, our operations plan is right on track, as we expect to turn in line about 40 wells during the first half of the fiscal year and another ten or so wells over the balance of the year.
Our increased completion base, along with our plans to operate two drilling rigs throughout fiscal 2022 is projected to drive an increase in our capital expenditures by $45 million year-over-year, which is consistent with our prior expectations.
With firm sales contracts in place for approximately 93% of our expected fiscal 2022 production volumes, minimizing our exposure to invasive spot pricing.
However, with prices north of $3.50 per MMBtu for our fiscal 2022 and $3 for fiscal 2023, the caveat will be whether this capital constraint will continue over the coming months and whether producers will stick to their current focus on free cash flow generation and maintenance production levels.
Moving to California, we expect to invest $10 million to $15 million a year, generating substantial free cash flow or moderating production declines, and we'll look for ways to increase our activity to the extent oil prices remain at current levels.
Upon completion of these projects, approximately 20% of our power needs in California will be met with solar.
National Fuel's third quarter GAAP earnings were $0.94 per share and after adjusting for an unrealized gain on our non-qualified benefit plan investments, operating results were $0.93 per share.
Starting with fiscal 2021, we're increasing and tightening our earnings guidance to a range of $4.05 per share to $4.15 per share.
Moving into fiscal 2022, we are projecting a 12% increase in earnings at the mid-point with our preliminary guidance in the range of $4.40 per share to $4.80 per share.
Starting first with the Pipeline and Storage segment, the direct benefit of the project will be approximately $50 million per year of incremental revenues.
Given the late calendar [Technical Issues] we expect approximately $30 million to $35 million of revenue from this project during fiscal 2022.
Seneca's expected production range for next year is 335 to 365 Bcfe.
This nearly 8% increase relative to fiscal 2021 will also benefit our gathering business, driving higher throughput and related revenue.
For fiscal 2022, we're assuming $3.50 per MMBtu with spot prices of $2.85 in the winter months, and $2.25 in summer period.
On the oil side, we're assuming $65 per barrel.
For reference, a $0.25 change in natural gas prices is expected to impact earnings by $0.15 per share, a $5 change in oil by $0.03 per share.
In our utility for the first three quarters of this year, we averaged about 13% warmer than normal -- warmer than normal weather.
For fiscal 2022, we're forecasting a return to normal weather, and as a result, we expect margins to be higher by approximately $10 million year-over-year, particularly in our Pennsylvania jurisdiction where we don't have a weather normalization clause.
This will be largely offset by modestly higher expected O&M expense, which we anticipate to increase 3% to 4% compared to fiscal 2021 driven by higher personnel costs, principally related to negotiated wage increases with our collective bargaining units along with normal inflationary increases to labor and other items that we see each year.
In the Pipeline and Storage business, we expect O&M to increase by 4% to 5% versus fiscal 2021.
This was principally driven by a one-time favorable benefit to O&M expense of approximately $4 million in fiscal 2021 that will not recur in fiscal 2022.
Lastly, from a guidance standpoint, we're expecting a modestly lower effective tax rate next year at 25% to 26% to stem from our ability to take advantage of tax credits related to our enhanced oil recovery activities at our California facilities for fiscal 2022.
Turning to our capital plans for next year, we're projecting a roughly 10% decrease relative to fiscal 2021.
This is driven by the completion of the $280 million FM100 project early in the year.
We started the year with a modest amount of short-term borrowings and well, we've had roughly $120 million of cash on hand at the end of June.
As we look to fiscal 2022, assuming a $3.50 NYMEX natural gas price we expect funds from operations to exceed capital expenditures by roughly $250 million.
This more than covers our dividend and is expected to leave us nearly a $100 million of excess cash flow positioning as well going into fiscal 2023.
We would have stepped over the course of fiscal 2022 to trend toward 2.5 times debt to EBITDA and with sustainable free cash flow beyond next year to seek further improvement beyond that level.

Summary:
Looking to next year on the strength of the FM100 project, our preliminary guidance for fiscal 2022 is $4.40 per share to $4.80 per share and to mid-point a 12% increase from our expected 2021 earnings.
National Fuel's third quarter GAAP earnings were $0.94 per share and after adjusting for an unrealized gain on our non-qualified benefit plan investments, operating results were $0.93 per share.
Starting with fiscal 2021, we're increasing and tightening our earnings guidance to a range of $4.05 per share to $4.15 per share.
Moving into fiscal 2022, we are projecting a 12% increase in earnings at the mid-point with our preliminary guidance in the range of $4.40 per share to $4.80 per share.