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El Paso Says BP Does Not Plan to Resume Operation of LA Processing Plant

El Paso Corp.'s Tennessee Gas Pipeline said it has been notified that BP America Production does not plan to resume operation of its Grand Chenier gas processing plant in southwestern Louisiana that was severely damaged by the Gulf Coast hurricanes last summer.

BP, which has operated the processing facility in Grand Chenier, LA, since January 2003, indicated that it was not financially feasible to undertake the work that was needed to restore the facility to its pre-hurricane status.

"Until a more permanent solution for gas processing and liquids separation can be achieved, Tennessee is allowing producers/shippers to deliver gas and liquids to the Targa Seahawk Pipeline system for processing at the Lowry Gas Processing plant" in Lake Arthur, LA, the El Paso natural gas pipeline said in a notice posted on Jan. 27.

"Tennessee anticipates that it can flow up to approximately 135,000 Dth/d through this interconnect. [It] may be required to restrict scheduled and/or physical volumes based on the limited amount of capacity on Tennessee to the Seahawk interconnect," the pipeline noted.

BP's Grand Chenier plant, which sustained flooding and other damages last September, had an operating capacity of about 600 MMcf/d and delivered gas into the Tennessee and ANR pipeline systems.

In other developments, Tennessee said the Yscloskey processing plant, which is operated and partially owned by Dynegy Inc., was currently operational and able to provide approximately 600 MMcf/d of gas processing services. The plant is located on Tennessee's 500 Line. The facility was flooded during Hurricane Katrina, significantly reducing its pre-hurricane operating capacity of 1.85 Bcf/d.

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