NGI The Weekly Gas Market Report

Briefs -- Colorado Gas Bills, Tennessee Gas Pipe Line, Impulsora Pipeline, WV Budget, Ohio Dumping Case, Utah Lease Sale

Retail natural gas utility bills will be up 2-4% this summer in Colorado, according to a filing on Wednesday to state regulators by Xcel Energy Inc.'s Denver-based combination utility, Public Service Company of Colorado. The rise comes despite the fact that gas commodity prices decreased for 3Q2016 compared to the same period last year. The higher monthly bills are caused by increases in other costs that were captured in a general rate case that went into effect early this year. Gas commodity costs for the third quarter are 33 cents/therm for residential customers, compared to 34.2 cents/therm for the same period last year; for small businesses the rate is 32.7 cents/therm in 3Q2016, compared to 33.89 cents/therm for with 3Q2015. Average bills are estimated to be $22.02/month for residential customers and $82.25 monthly for small businesses, compared to $21.18 and $80.60 for residential and small business customers, respectively, last year in the same quarter.

Staff of the Federal Energy Regulatory Commission (FERC) has prepared a favorable Environmental Assessment (EA) of Tennessee Gas Pipe Line Co LLC.'s (TGP) proposed Triad Expansion Project [CP15-520]. FERC staff concluded that the project, with appropriate mitigating measures, would not adversely affect the environment, according to the EA. The EA comes nearly a year after TGP filed for a certificate with FERC to expand its system in Pennsylvania by 180,000 Dth/d to serve a new natural gas-fired power plant in the northeast part of the state (see Daily GPIJune 19, 2015). The $87.4 million project would consist of constructing seven miles of 36-inch diameter pipeline looping and include the installation of new a pig launcher and crossover and connecting facilities, as well as modifications to an existing compressor station.  TGP said the construction and modifications would occur on its 300 Line, which runs from Mercer County, PA, eastward through the state and into others before ending in Massachusetts. The expansion would deliver natural gas to an existing interconnection with utility UGI Corp., which would then deliver the gas from Susquehanna County directly to the new power plant in Lackawanna County, PA, TGP said. FERC will take comments on the EA through July 15. 

The Federal Energy Regulatory Commission (FERC) has approved amendments to authorization it previously granted Impulsora Pipeline LLC (previously Columbia Pipeline LLC) for border crossing natural gas pipeline facilities between the United States and Mexico for a project that would carry gas from the Eagle Ford Shale to markets in Mexico [CP16-70]. Impulsora no longer plans to build one of the previously-authorized parallel pipelines in Texas at the international border between the United States and Mexico, FERC said. The border crossing would be in Webb County, TX, and near Colombia in the Mexican state of Nuevo Leon. The project would be constructed by Impulsora, a unit of San Antonio-based Howard Energy Partners LLC, which provides midstream services mainly in the Eagle Ford. Last year, FERC approved plans for parallel 36-inch and 12-inch diameter pipelines (see Shale DailyMay 15, 2015). The company has determined that it will only need the 36-inch diameter pipeline, FERC said.

After a three-month impasse, the West Virginia Legislature passed a $4.2 billion 2016-2017 budget. The state has long relied on coal and natural gas severance taxes to balance its budget, but the commodities downturn has strained its finances. It has already cut state spending on the falling revenues (see Shale DailyOct. 6, 2015). Lawmakers couldn't agree on tax increases or spending cuts earlier this year, when they gathered for their regular session, forcing Democratic Gov. Earl Ray Tomblin to call a special session that lasted for 17 days. Ultimately, the legislature agreed on a tax hike on cigarettes to generate $98 million, which was combined with $120 million in spending cuts and one-time funds, along with money from the state's rainy day fund to close a $270 million budget shortfall.

A federal court has sentenced a Monroe County, OH, man to four days in jail, two years of probation, community service and ordered him to pay a $70,000 fine for dumping oilfield waste into a ditch repeatedly. Donald Hercher, owner of legacy producer Hercher Oil Co. was discovered dumping roughly 50 gallons/week of drilling waste into a ditch in Monroe County. The case is reminiscent of another in Northeast Ohio. A federal court sentenced Ben W. Lupo to 28 months in federal prison in 2014 and ordered him to pay a $25,000 fine for his role in directing employees to dump tens of thousands of gallons of oilfield waste down a drain that led into a major river (see Shale DailyAug. 6, 2014). Those incidents occurred in Youngstown at the headquarters of former businesses owned by Lupo, including D&L Energy Inc. and Hardrock Excavating LLC.

The U.S. Bureau of Land Management (BLM) Utah Vernal field office said it is seeking public comment on the environmental assessment (EA) done regarding its plans to offer 28 parcels totaling about 12,225 acres for oil and natural gas leasing set for November this year. Maps and additional information are included in the EA, which is posted on the BLM website (https://eplanning.blm.gov/). The public comment period will run through July 15, and BLM said it is particularly looking for the identification of issues germane to proposed sale or new technical or scientific information relevant to the case. "Comments that contain only opinions or preferences will not receive a formal response, but may be considered in the BLM decision-making process," a BLM Utah spokesperson said.

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