NGI The Weekly Gas Market Report / NGI All News Access

Industry Briefs

MarkWest Pioneer LLC is holding a nonbinding open season/reverse open season through 5 p.m. MDT July 20 to determine whether to expand the Arkoma Connector, a 50-mile interstate natural gas pipeline initially designed to deliver 625,000 Dth/d from the Woodford Shale to pipelines destined for eastern markets. MarkWest Pioneer said it received inquiries about adding firm transportation service to the Arkoma Connector. The reverse open season would determine whether existing shippers want to return "all or a portion of their current firm transportation entitlements," MarkWest said. Precedent agreements are in place with two anchor shippers: Newfield Exploration Mid-Continent Inc. for 500,000 Dth/d of firm transportation for nine years, and Chesapeake Energy Marketing Inc. for 76,000 Dth/d of firm transportation for 10 years. The 24-inch diameter Arkoma Connector, which is nearing completion, would extend from the outlet of a MarkWest affiliate's existing treating plant in northeast Oklahoma to near Bennington, OK, where it would interconnect with the Midcontinent Express Pipeline and Gulf Crossing Pipeline systems. The project includes 19,500 hp of added compression at two compressor stations and associated facilities in Oklahoma's Coal, Atoka and Bryan counties.

The U.S. Maritime Administration (MARAD) said Gulf Landing LLC has surrendered its license to build a liquefied natural gas (LNG) deepwater port off the coast of Louisiana. While the news wasn't published in the Federal Register until late June, MARAD said the surrender and cancellation of Gulf Landing's license was effective April 30. The decision to surrender the license came more than two years after developer Shell Oil Co. decided to drop its plans to build the deepwater port, which was to be located 38 miles south of Cameron, LA, in West Cameron Block 213 (see NGI, April 2, 2007). Shell's Greg Koehler, project director for Gulf Landing, said at the time the decision to halt the project was driven by U.S. market concerns, especially the plethora of LNG projects that were targeted for the Gulf Coast.

The national security team of the Royal Canadian Mounted Police (RCMP) are investigating another possible attack on an EnCana Corp. natural gas pipeline in northern British Columbia. EnCana reported a gas leak last Wednesday along a section of pipeline near Dawson Creek, BC. RCMP was investigating the leak, but officials said the probe was being hampered by the leak's severity. No one appeared to be injured because of the leak, an EnCana spokeswoman told NGI. However, she said the leak apparently was the result of an explosion. Since last October there reportedly have been four bombings of EnCana's pipelines (see NGI, Jan. 19).

The Federal Energy Regulatory Commission has given Columbia Gas Transmission LLC the green light to place into service part of the proposed expansion of its Ohio storage facilities. The NiSource Inc. pipeline subsidiary was cleared to begin service at nine new storage wells and seven well lines at the Crawford storage site about 45 miles south of Columbus, OH. FERC did not authorize service for two other wells and six well lines. "We will authorize these facilities once we receive documentation that restoration is proceeding satisfactorily," the letter order said [CP08-431]. So far Columbia has drilled 11 of 19 new wells that it plans for the Crawford site, said spokesman Kelly Merritt. The Crawford expansion will increase the working gas capacity of Columbia's Crawford storage facilities by 3 Bcf (see NGI, March 23). Columbia has begun work to expand its Weaver storage field about 50 miles northeast of Columbus, OH. The pipeline plans to rework 20 existing wells and do some pipeline construction, Merritt said. The expansion of the Weaver site would add 3.7 Bcf of storage capacity. Both the Crawford and Weaver storage expansions are targeted for service by November, he said. The combined deliverability from Weaver and Crawford fields will be increased by 100 MMcf/d.

The Federal Energy Regulatory Commission has issued a favorable environmental assessment to Transcontinental Gas Pipe Line for its proposed 308,500 Dth/d system expansion to serve natural gas markets in the Southeast. The Williams pipeline subsidiary proposes to construct three 42-inch diameter pipeline loops with a combined length of approximately 22.06 miles adjacent to its existing system in Alabama and South and North Carolina, as well as add a new 20,500-hp compressor station in Anderson County, SC, and modify eight existing compressor stations in Mississippi, Alabama, Georgia and South and North Carolina. New Service from the 85 North Expansion Project would be available in two phases, subject to FERC approval. Phase I would increase capacity by 90,000 Dth/d by the summer of 2010, while Phase II would increase capacity by 218,500 Dth/d by the summer of 2011, according to Tulsa, OK-based Williams. It estimates that the 85 North project will cost approximately $248 million. Combined with its Mobile Bay South II project, the 85 North expansion creates over half a Bcf of takeaway capacity from Station 85 in west-central Alabama to downstream markets, according to Williams. It noted that the project is positioned to provide Transco customers with access to more than 3 Bcf/d of new domestic and liquefied natural gas (LNG) supplies at Station 85 over the next few years.

The U.S. Environmental Protection Agency (EPA) has granted California a waiver to enforce a state greenhouse gas emissions standard for new motor vehicles, beginning with the current model year. Environmentalists and state officials immediately lauded the much-anticipated move by EPA Administrator Lisa Jackson. Saying the decision puts "law and science" on the same first-priority footing, Jackson said she considers this the "appropriate course under the law" in granting the waiver. "This waiver is consistent with the [federal] Clean Air Act as it's been used for the last 40 years and supports the prerogatives of 13 states and the District of Columbia." Bernadette Del Chiaro, a clean energy advocate for Environment California, predicted that the EPA waiver will result in California reducing its global warming pollution by 158 million metric tons by 2020, "eliminating the pollution from 30 million cars for a year and saving consumers $36 billion at the pump."

©Copyright 2009 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.