Palmetto Pipeline Declares Open Season
The Palmetto Pipeline, a proposed joint venture between Carolina
Power & Light (CP&L) and Sonat, announced an open season
Monday seeking interest from potential firm gas transportation
service customers for terms of at least 20 years. The open season
began April 1 and will continue through May 31.
CP&L plans to subscribe for a substantial portion of Palmetto's
200 MMcf/d to 300 MMcf/d capacity to fuel new electric generation
being developed in the Carolinas, with the remainder to be used to
increase regional gas availability. CP&L said it plans to build
4,000 MW of gas-fueled generation in the Carolinas by 2007. It also is
in the process of buying LDC North Carolina Natural Gas (NCNG) for
$354 million (see Daily GPI Nov. 12,
1998). Palmetto also would serve some of the gas needs of NCNG.
The proposed pipeline, which would run from Sonat's system in
Aiken, SC, to an interconnect with NCNG in Roberson, NC, has Phase
II and Phase III expansions planned for April 2003 and April 2004,
respectively, with the ultimate goal of increasing capacity up to
the amount subscribed.
Sonat said it would expand its pipeline system to accommodate
Palmetto's growth in the form of additional pipeline looping and
compression. The extent of the Sonat's expansion will be determined
by its ongoing open season, which is being held between the same
dates as the Palmetto open season.
"If Palmetto signs up 300 MMcf/d worth of capacity, then Sonat
will have to expand by that much because Aiken, SC, is Sonat's
terminus and Palmetto's origination," said Mark Limbaugh, director
of Sonat's market development. "But it is very early on in this
process. There are so many issues to clear up and we don't plan to
file anything with FERC until this coming December."
Palmetto is holding this test of potential interest despite the
disapproval of two main competitors, Williams Transco and Scana See Daily GPI, March 4). Neither company could
be reached before press time, but each had said it planned to file
objections with FERC.
Both the Sonat expansion and the Palmetto project still need
FERC and state approval. Construction is also subject to the
execution of a definitive agreement between Sonat and CP&L.
©Copyright 1999 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.