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FERC OKs Pre-Filing Bids for Sparrows Point LNG, TransColorado Projects

FERC last Monday approved an AES Corp. affiliate's request to begin the pre-filing process for a proposed $400 million liquefied natural gas (LNG) import terminal to be located at the old Bethlehem Steel Sparrows Point industrial site on Baltimore Harbor. It also gave a nod to TransColorado Gas Transmission's request to initiate the pre-filing process under the National Environmental Policy Act for its proposed Blanco-to-Meeker expansion, which would support gas flows to the planned $3 billion Rockies Express Pipeline project.

"We believe that beginning the Commission's review prior to our receipt of your application will greatly improve the chances of identifying specific project issues and addressing them in a timely manner," wrote J. Mark Robinson, director of FERC's Office of Energy Projects, in a letter to AES Sparrows Point LNG LCC in Lockport, NY.

"In your letter you requested Commission approval of the Sparrows Point Project by September of 2007. We believe that with your full participation in our pre-filing review process, it will be possible to complete an environmental impact statement in the [time frame] necessary to meet your stated request." An increasing number of LNG and pipeline project sponsors are participating in the pre-filing process, which allows them to address landowner and environmental concerns prior to filing their project applications with the Federal Energy Regulatory Commission.

The proposed Sparrows Point project calls for the construction of a 1.5 Bcf/d terminal in Baltimore County, MD. It also would include storage tanks and an 85-mile pipeline that essentially would parallel the Columbia Gas system into Eagle, PA, and would provide interconnects with Columbia, Texas Eastern Transmission and Transcontinental Gas Pipe Line. The sendout capacity could be expandable later to 2.25 Bcf, according to the company.

AES Sparrows Point said it is seeking to have at least one connection to Baltimore Gas and Electric's system and maybe as many as two or three, depending on what the utility wants. It hopes to start construction by early 2008, with the project to be completed in 2010.

In its pre-filing request, TransColorado signaled that it plans to file a certificate application in May of this year. "Although this filing date does not meet our guidance to not file an application until at least 180 days after beginning the pre-filing process, I am granting your request based on our understanding that the Blanco-to-Meeker project is a necessary and supporting component to Rockies Express Pipeline LLC's project, currently under pre-filing review" at FERC, Robinson said (see NGI, Nov. 28, 2005).

"My staff will conduct the required...review of your project as part of the environmental impact statement we are preparing for the Rockies Express Pipeline project. You should be aware that the already established schedule for the Rockies Express Pipeline project may be affected by the timeliness and adequacy of TransColorado's filings."

The proposed $300 million Blanco-to-Meeker project would support flows into the Rockies Express project, a 1,350-mile, 2 Bcf/d gas pipeline system that would bring Rocky Mountain gas to Ohio and ultimately to markets in the Midwest and Northeast. The proposed expansion would link TransColorado to several major interstate and intrastate pipelines, gathering systems and local distribution company systems, including the Entrega Pipeline, which will become the upstream leg of Rockies Express.

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