Saying it would not jeopardize service on the system, FERC last Monday upheld an earlier order permitting CenterPoint Energy-Mississippi River Transmission Corp. (MRT) to abandon 307 miles of 76-year-old pipeline facilities in northern Louisiana, Arkansas and southern Missouri.
Specifically, MRT sought to abandon more than 300 miles of three 22- to 24-inch diameter pipelines (Main Lines 1, 2 and 3) that run roughly parallel to each other from the pipeline's compressor station at Perryville, LA, to its primary market area in and around St. Louis, MO, and cross-over pipes located at 23 sites, as well as a host of other associated facilities.
The pipe facilities are used to transport gas from production fields in the Perryville area to markets in the St. Louis area, and from various receipt points along the pipeline system to storage fields in the Perryville area.
Rather than replace the facilities, MRT's affiliated interstate pipeline, CenterPoint Energy Gas Transmission Co., will turn back a sufficient amount of its reserved firm downstream capacity on MRT's system to ensure the continued reliability of MRT's firm southbound transportation services to inject natural gas into storage.
MRT also has made arrangements with CenterPoint to ensure the reliability of firm northbound transportation services to market areas. Namely, MRT and CenterPoint Energy entered into an agreement under which CenterPoint Energy will receive a discounted transportation rate for its entire maximum daily quantity of 348,837 Dth/d in exchange for delivering up to 85,000 Dth/d to the Olyphant, AR, interconnect.
The Missouri Public Service Commission and AmerenUE sought rehearing of the October 2004 order, expressing concern that MRT's agreement with CenterPoint Energy does not guarantee that CenterPoint Energy will always be able to deliver sufficient volumes at the Olyphant interconnect to make up for capacity lost as the result of the abandonment.
"The Commission affirms its conclusion in the Oct. 28 order that Mississippi River's proposed abandonment of facilities should not jeopardize its ability to meet its service obligations," FERC said in its rehearing order [CP04-334-001].
FERC, however, granted MRT's rehearing request in part. MRT contended that FERC had erred when it concluded that the pipeline's tariff provisions relating to system management gas do not authorize purchases of gas to make up for shippers' gas that the pipeline is unable to deliver from storage due to capacity constraints.
The Commission said it still disagreed that MRT's tariff allowed for such gas purchases. But "since Mississippi River states such purchases may be necessary to meet its firm service obligations, the Commission is directing Mississippi River to make a compliance filing to revise the language [in its tariff] to make clear that it accommodates the pipeline's contemplated actions," the order noted.
FERC, however, "is not requiring, as requested by Ameren and the Missouri Commission, that [the tariff] be revised to require that Mississippi River purchase gas to make up for shortfalls at Olyphant. There is no need for such a requirement."
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