CNG Flip-Flops on Capacity Needs, Other Pipe Projects Say
The Independence Pipeline and Millennium Pipeline projects
contend CNG Transmission Corp. is speaking with a forked tongue
when it comes to the need for new pipeline capacity to supply the
growth in gas demand that's expected for the Northeast market.
On one hand, CNG claims no market exists to support the
competing Northeast-bound Independence and Millennium projects, but
it did an about-face last week when it announced a joint venture
with Tennessee Gas Pipeline to transport 750,000 Dth/d of gas from
Chicago and the Niagara Import Point to markets in New York,
Pennsylvania and New England, the two projects pointed out
[CP97-315 et al].
But CNG, which views its proposal as a response to the
Independence and Millennium greenfield projects, said the joint
venture-the Atlantic Alliance Project-doesn't signal a departure
from its previous views on Northeast market growth. "In fact, this
project represents a reasonable way to accommodate market growth,
while encouraging the efficient use of the existing pipeline grid,"
it told FERC. CNG added the project would involve "construction of
a relatively small amount of new pipeline facilities."
Independence contends CNG has stooped to using "delaying
tactics," such as criticizing FERC's environmental analysis of the
1 Bcf/d Independence, in order to give its Atlantic Alliance
Project time to "catch up." Independence, which was first announced
in 1997, urged FERC "not to countenance" such conduct by CNG.
Millennium officials also accused CNG of similar tactics, and
added that its recently announced Atlantic Alliance Project shows
that CNG has flip-flopped on its previous claim that no new
capacity would be immediately needed for the Northeast. The
Atlantic Alliance "plans make it clear that CNG does not agree with
the testimony it.....presented to the Commission [at the Northeast
conference in June], and that the testimony was only filed as part
of a regulatory strategy designed to delay the Millennium project,"
said David C. Pentzien, chairman of the Millennium Pipeline
CNG, as well as Texas Eastern Transmission (Tetco), has asked
the Commission to suspend further action on Independence while FERC
staff considers alternatives to the project, including ones that
they have proposed. They insist staff's draft environmental impact
statement (DEIS) analysis of the Independence and the related
MarketLink projects was "deficient" and "useless" because it failed
to review all viable alternatives. Tetco has gone a "step further"
and has asked FERC to hold another conference to assess various
project alternatives. Tetco and CNG-which have a dominant grip on
the Northeast market-insist their proposed alternatives could
eliminate much of the need for the 624-mile Independence project
and possibly the MarketLink expansion. CNG also sees its
alternative as a substitute for Columbia Gas Transmission's New
York-bound Millennium project. Their alternatives incorporate the
use of existing and potential turned-back capacity on their
But Independence noted "for sufficient turnback capacity to be
available to meet the firm needs for Independence/MarketLink
markets, substantial existing market demand that is currently being
served by that capacity would have to disappear..... Independence
does not believe this is a realistic assumption." And "if Tetco's
and CNG's assumptions are incorrect with respect to the
availability of turnback capacity, even more facilities would be
required to be constructed and possibly even more delay" would
occur, argued Independence, whose sponsors include ANR Pipeline,
National Fuel Gas Supply and Transco. The Commission "should not
delay the Independence proceeding because two pipeline competitors
have presented incomplete, speculative and unfiled 'alternatives'
at the eleventh hour," Independence said.
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