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Scana Plans Pipeline to Compete with Palmetto

Scana Plans Pipeline to Compete with Palmetto

Scana's South Carolina Pipeline Corp. announced Wednesday it plans to build an interstate pipeline running from South Carolina to North Carolina, and in the process held no punches on promoting its pipeline over the proposed Carolina Light and Power (CP&L)/Sonat Palmetto Pipeline project. Scana did not release details of its proposal, but did say formal descriptions will be announced in the coming weeks.

"Our interstate pipeline project is a superior alternative to the proposed Palmetto Pipeline and will continue South Carolina Pipeline's long-established, responsible support for economic development in South Carolina while providing a second source of gas service into North Carolina," said Berry Gibbes, president of South Carolina Pipeline.

The announcement comes two days after the Palmetto Pipeline announced an open season for potential customers seeking service from the pipeline for at least 20-year terms (See Daily GPI, April 13). Gibbes said the South Carolina proposal will give shippers a more flexible and reasonably priced alternative before Palmetto's open season expires on May 31.

"We recommend that any gas shipper who may be considering subscribing to firm capacity on the proposed Palmetto Pipeline Project wait to compare our alternative interstate pipeline before being locked into a more costly service for up to 20 years," Gibbes said.

CP&L was not surprised by Scana's comments. "This is Scana's first experience with competition in this environment," said CP&L spokesman Mike Hughes. "The fact that there has been no competition in this market is being proved by the considerable interest we have gotten during the first days of Palmetto's open season. Additionally, CP&L will account for a large portion of Palmetto's capacity, maybe as much as half of its initial capacity. That is a reason to build a pipeline. There is still a considerable question as to what will make Scana's project economically viable."

South Carolina Pipeline currently operates a 1,900-mile intrastate pipeline transmission system that supplies gas to customers throughout much of South Carolina. It has direct connections with both the Transco and Sonat systems. Over the past three years, the company said it spent $50 million in system upgrades.

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