Boardwalk Pipeline Partners LP subsidiaries Gulf Crossing Pipeline Co. LLC and Gulf South Pipeline Co. LP received a FERC nod to place in service the initial portion of the Gulf Crossing project from Grayson County, TX, to Ouachita Parish, LA. Gulf Crossing also got the go-ahead to place three metering facilities in service: Enterprise Texas Pipeline's station in Grayson County; Enogex Inc.'s station in Bryan County, OK; and Texas Gas Transmission's station in Ouachita Parish. The approval came two weeks after the Commission gave Gulf South the green light to place in service the 42-inch diameter Mississippi Loop of the Gulf Crossing project. The 17.8 miles of pipeline loop are located between Hinds County, MS, and Simpson County, MS. Gulf Crossing said it expects to place in service during the first quarter the entire 356.3-mile, 42-inch diameter pipeline and associated compression facilities.
In response to requests for new storage service, Southern Star Central Gas Pipeline Inc. launched an open season through 5 p.m. CST Feb. 20 to solicit binding bids for new firm service in the Midcontinent. Southern Star said it has determined that it can construct facilities to expand its existing storage capacity by a minimum of 5 million Dth, with an increase in daily deliverability of a minimum of 50,000 Dth/d. "Additional firm storage service will reduce natural gas price volatility for Southern Star's existing and future customers, and enhance gas supply management, flexibility and liquidity for shippers," said Southern Star CEO Jerry Morris. "The Midcontinent region has exhibited a growing appetite for new storage, and we believe this expansion is a great first step towards satisfying that appetite." Owensboro, KY-based Southern Star Central spans more than 6,000 miles in the Midwest and Midcontinent regions. Interested parties may access open season information at: http://csi.sscgp.com under the "Open Season Information" tab in the Public Area.
As a result of early settlement and reset arrangements for 37% of its 2009 commodity hedge volumes, XTO Energy Inc. said it has realized about $900 million of after-tax proceeds that it has used to reduce its outstanding debt. The company expects to end the first quarter with net debt of approximately $11 billion. The net effect of the early settlements is to accelerate cash receipts, while maintaining XTO's full hedge position against further declines in oil and natural gas prices during the year. By executing the transactions, the company said it has accomplished the lion's share of its previously announced $1.25 billion minimum debt reduction. In November XTO said it had 1,745 MMcf of gas hedged at $8.83/Mcf for 2009 and 730 MMcf of gas hedged at $8.67/Mcf for 2010 (see NGI, Nov. 24, 2008). At the same time, the company's board of directors approved a 2009 capital budget for development and exploration expenditures of $3.3 billion and an additional $500 million was budgeted for the construction of pipeline infrastructure and compression and processing facilities.
Norex Energy said assets it is acquiring in Alberta have the potential to contain more than 8 Bcf of natural gas. Norex recently announced that it would acquire a 49% interest in a natural gas processing and compression facility, natural gas pipeline, additional infrastructure and certain lands associated with the infrastructure. The company also has the option to obtain the remaining 51% interest from the owner over a two year period. The processing facility, constructed in 2004, is capable of processing sour gas by a regenerative solution, as well as sweet gas compression, gas metering and water storage. Norex is also acquiring a network of five six-inch diameter pipelines that connect to a major trunk line operated by EnCana and that extend out toward three gas wells ready for tie-in.
The Federal Energy Regulatory Commission ordered ConocoPhillips and Marathon Oil to begin submitting semi-annual operation reports and significant incidents reports for their liquefied natural gas (LNG) export terminal and storage facility in Kenai, AK. The Commission in 1967 approved the companies' request for authorization to export LNG from the Kenai facility, but FERC at the time did not subject the facility to the reporting and inspection requirements that now apply to all other operational LNG terminals. The Kenai facilities, which export LNG to Pacific Rim countries, "will be subject to a cryogenic design and technical review of the facility's design, operation and maintenance" by FERC; regular Commission staff technical reviews and site inspections on at least an annual basis or more frequently; and will be required to file semi-annual operational reports that identify changes in facility design and operating conditions, abnormal operating experiences, plant modifications and future plans. Reports are to be filed within 45 days after each period ending June 30 and Dec. 31.
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