Kern River Puts Expansion on Hold
While Questar continues preliminary work on its California-bound
mainline, Kern River Pipeline has put its plans to run a new
large-diameter pipeline into Southern California on hold, awaiting
regulatory action from the dilatory California Public Utilities
"It is just a watch-and-wait situation" for us right now, said a
spokesperson for Kern River, a subsidiary of Williams. The project
has been "put on hold in order to wait and see what develops in
California" where state officials are in the midst of a two-year
effort to restructure the natural gas industry.
This spring Kern River officials said they had received
expressions of interest from large industrial customers equating to
about 1 Bcf/d of supplies in and around the industrial corridors
of Los Angeles County and at the port city of Long Beach. In the
meantime, Southern California Gas has pushed for state regulatory
and legislative changes that would make it harder for competing
pipelines to take away some of the gas utility's largest customers.
Those proposals will not be acted upon until later this year.
Nevertheless, a second proposal for a new interstate pipeline
into California by Salt Lake City-based Questar is moving ahead
with a slightly delayed schedule, according to its spokesperson.
Called the Southern Trails Pipeline, Questar has an application
with FERC to convert the 700-mile former ARCO oil pipeline from the
northwest corner of New Mexico into Long Beach to carry 120-130
MMcf/d of natural gas.
The spokesperson indicated that Questar expected to have its
first major contracts for the new pipeline ready to announce in the
next few months. The firm is in the midst of completing an
environmental impact report and other regulatory matters, but is
pointing toward beginning construction in the spring of next year.
It plans to add seven compression stations for natural gas
transmission and make other modifications in the 16-inch-diameter
"We're going through the same process with FERC in terms of
environmental assessment as we would have gone through to build a
whole new pipeline," the Questar spokesperson said.
Constructed in 1957 to carry crude oil, the former ARCO oil
system includes Lines 90, 91 and 92, which Questar purchased last
year for $40 million.
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