Requests for evidentiary hearings of three Transcontinental Gas Pipe Line Co. LLC (Transco) expansion projects filed at FERC by the North Carolina Utilities Commission (NCUC) and the New York State Public Service Commission (NYPUC) "are without merit and should be denied by the Commission," said the Williams Partners LP affiliate.
"The essence of the state commission's protest is that Transco's proposed recourse rates must be found in the certificate proceedings to be 'just and reasonable.' That argument fails because there is no such requirement for the Commission's determination of initial rates in certificate proceedings under Section 7 of the NGA [Natural Gas Act]," Transco said in a Federal Energy Regulatory Commission filing in response to the NCUC and NYPUC protests.
The two regulatory agencies last month alleged that separate certificate applications for the projects filed by Transco raised issues of material fact regarding their proposed recourse rates, and they said the issues must be resolved through an evidentiary hearing. The projects are Transco's Atlantic Sunrise expansion (see Daily GPI, March 21) and Dalton Expansion Project (see Shale Daily, March 20), both of which would move Marcellus Shale gas to markets in the southeast, and the Virginia Southside Expansion Project II, which would provide firm transportation service from Mercer County, NJ, and Pittsylvania County, VA, to a proposed delivery point near Transco's Brunswick Lateral.
"The state commission's more specific concerns regarding Transco's use of its last approved pre-tax return, the benefits to ratepayers of Transco's proposed lease arrangements, and the pricing of Dalton service also fail to demonstrate any deficiency or issue," Transco said in its filing. "Moreover, the state commission's request for partial consolidation and hearing are contrary to Commission policy."
The Atlantic Sunrise project would provide 1.7 Bcf/d of firm capacity from northern Pennsylvania in Transco's Zone 6 to Transco's Station 85 in Alabama, including markets along the Transco system in Pennsylvania, Maryland, Virginia, North Carolina, South Carolina, Georgia, Alabama, and interconnects with existing pipelines serving the Florida market, the pipeline said in its filing [CP15-138]. The project would include construction of 57.3 miles of 30-inch diameter greenfield pipeline (the Central Penn Line North) and 125.2 miles of new 42-inch diameter greenfield pipeline (the Central Penn Line South), incremental facilities on Transco's existing natural gas transmission system, and modifications to Transco's existing natural gas transmission system to enable north-to-south flow. Williams expects to place Atlantic Sunrise into service in the second half of 2017.
The 448,000 Dth capacity Dalton Expansion Project would consist of an expansion of Transco's mainline from its Station 210 in New Jersey to points as far south as Holmesville, MS, and a new 111-mile lateral pipeline from Transco's Station 115 to Murray County, GA. [CP15-117]. Construction is planned to begin in the third quarter of 2016 with completion targeted for 2017.
The Virginia Southside Expansion Project II would enable Transco to provide 250,00 Dth/d of incremental firm transportation service to a single shipper, Virginia Power Services Energy Corp.. The $190.8 million project would involve construction and operation of 4.3 miles of 24-inch diameter pipeline and associated compression facilities.