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CenterPoint, Duke Test Market Interest in 250-Mile Perryville-to-Gulfstream Pipeline

With a pre-filing process already underway at FERC on CenterPoint's Energy's proposed 1 Bcf/d pipeline from Carthage, TX, to Perryville, LA, the company has teamed up with Duke Energy Gas Transmission to propose another new pipeline downstream of Perryville to the Gulfstream Natural Gas System, which is owned by Duke and Williams. Gulfstream serves the Florida peninsula and would provide premium market access to producers delivering gas to Perryville from fields in North and East Texas.

Duke and CenterPoint announced an open season on the proposed 250-mile system on Thursday. The companies first announced plans for the project last month (see NGI, Nov. 17). On Nov. 16, they announced the execution of a memorandum of understanding to cooperate in the evaluation, marketing and development of the pipeline.

The proposed pipeline route would cross and interconnect with all of the major interstates serving the eastern United States that are not currently served at the Perryville Hub in northeast Louisiana. The pipeline would provide summer electric utility markets in the Southeast, as well as the winter heating markets in the Northeast, with reliable onshore supply from the growing Barnett Shale, Fayetteville Shale and Bossier Sand basins via the highly liquid Perryville Hub. It also would also provide an important link for traditional Gulf Coast-area supply and developing regasified liquefied natural gas (LNG) volumes, the companies said.

The capacity of the potential project would be between 700 MMcf/d and 1 Bcf/d and the new pipeline could enter service as early as mid-2008. The non-binding open season runs through Jan. 20.

FERC initiated a pre-filing process earlier this month for CenterPoint's proposal to build a new 168-mile pipeline between Carthage Hub in East Texas and the Perryville Hub in northeastern Louisiana. The $375 million upstream pipeline project would have an initial design capacity of 1 Bcf/d and could be in service as early as the winter of 2006-2007. In late October, CenterPoint entered into an agreement to transport 600 MMcf/d of East and North Texas gas production for XTO Energy on the proposed system (see NGI, Oct. 31).

For details on the Perryville-to-Gulfstream project open season contact David Shammo at (713) 627-4419 (dashammo@duke-energy.com) or John Haynes at (713) 207-5130 (john.haynes@CenterPointEnergy.com).

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