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Repsol Files FERC Protest Over M&NE's Proposed Tariff Revisions

Repsol Energy North America Corp., the largest shipper on Maritimes & Northeast Pipeline LLP (M&NE), filed a motion to intervene and protest with FERC last week after M&NE proposed several tariff revisions.

According to documents filed with the Federal Energy Regulatory Commission [RP16-363], Repsol takes issue with M&NE's proposals to replace the current "first come, first serve" methodology for allocating available capacity on the pipeline with one based on net present value (NPV). Repsol also objects to M&NE requiring an open season to be held following receipt of a request for capacity with a term greater than 30 days; specifying time limits for capacity requests to commence at a future date; and expanding M&NE's rights for reserving available capacity for a future expansion.

"Each of these proposals would unjustly and unreasonably impair and prejudice Repsol's ability to serve the market by significantly altering Repsol's ability to change the path of all or a portion of the capacity it currently holds under its existing long-term firm service agreement with M&NE," Repsol said in an 18-page filing on Jan. 19.

"A path change under Repsol's current service agreement, effectuated through primary receipt and delivery point changes, will allow Repsol to continue to reliably serve the region's gas demand as the gas supply dynamics on the M&NE pipeline system change with the implementation of new south-to-north flow on the system. Accordingly, Repsol requests that the Commission reject these aspects of Maritimes' proposal."

Repsol also wants M&NE to clarify whether the proposed tariff changes would also apply to the latter's Atlantic Bridge Project [CP16-9], and if the proposed language would give M&NE the right, but not the obligation, to hold an open season following receipt of a request for firm service of 30 days or less.

Atlantic Bridge would enable an M&NE affiliate, Algonquin Gas Transmission LLC, to provide 132,705 Dth/d of firm capacity from its receipt points at Mahwah, NJ, and Ramapo, NY, to new and existing points on the Algonquin system, including an interconnection with M&NE at Beverly, MA (see Daily GPIDec. 24, 2015). The project also would allow M&NE to provide 106,276 Dth/d of firm capacity from Beverly to existing delivery points on its system for project shippers. The project is expected to be in service by the second half of 2017.

Repsol is the single largest shipper on M&NE, holding nearly all of the pipeline's firm capacity. It is also the sole anchor shipper for M&NE's Phase IV expansion, with 730,000 Dth/d of firm capacity until 2034, spanning the entirety of the M&NE system, which has total firm end-to-end capacity of 833,317 Dth/d.

It is not the first time Repsol has complained to FERC about Atlantic Bridge. Last December, Repsol said M&NE and Algonquin have failed to answer questions over how the project could impact M&NE's existing shippers (see Daily GPI,Dec. 31, 2015).

"Despite the impact that the Atlantic Bridge Project will have on existing shippers, Repsol notes that M&NE has refused to affirmatively disclose how much available capacity will result from the Atlantic Bridge Project," Repsol said in the Jan. 19 filing. "This refusal to be transparent and provide this basic information to its existing shippers inhibits [our] ability to fully assess the impacts of the Atlantic Bridge Project and plan for the capacity becoming available to it through a primary point change request."

Repsol said its protest over M&NE's tariff proposals should not be misinterpreted as a protest against Atlantic Bridge, adding that it "raises these points only to emphasize that M&NE's tariff proposals will have a real impact on existing firm shippers."

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