El Paso, Kern River Plan Emergency Pipeline Expansions
The California energy crisis attracted two emergency gas
pipeline projects last week, one from Kern River Gas Transmission
and another from El Paso Natural Gas. Together the projects would
add 365 MMcf/d of firm transportation to the California market by
In response to the "urgent" need for additional gas supplies to
serve California's electric generation markets this summer, Kern
River Gas Transmission held an open season last week for 135,000
Dth/d firm transportation service expected to be available by July
"It would mean the fast track through FERC and getting all the
environmental permits in three-and-a-half months," said spokeswoman
Bev Chipman. "It would be quicker than ever before. We've already
spoken with FERC. They are very interested, and we are very
interested to entertain this possibility."
FERC Chairman Curt Hebert told the House Energy and Air Quality
subcommittee last week that the Commission was committed to moving
rapidly on any projects designed to move gas to California.
Kern River, which already has one expansion on file and another
on the way, is proposing this project as an emergency solution to
California's power crisis. The $81 million project would be
finalized by April 2 based on whether the necessary permits and
licenses for construction have been obtained. Kern could cancel the
project if expansion capacity is not fully subscribed.
A portion of the emergency facilities could be incorporated into
Kern River's 2002 California Expansion Project, which is currently
on file at FERC, or its 2003 New Generation Expansion Project,
which recently underwent an open season. Kern River said the
project would include modifications to three existing compressor
stations, installation of three new compressor stations and
expansion of a meter station. Several temporary facility
installations would be removed once the other two permanent
expansions were in place and in service.
"In response to FERC and to the state of California we have
located available compression equipment that we could have on site
nearly immediately, and we've come up with a proposal to place
those compression units on the very same sites we will be using for
our permanent expansions," said Kirk Morgan, director of business
development for Williams Gas Pipeline West, which operates Kern
River. "FERC already has an application in front of them that deals
with the site locations. These are different units so there are
different air quality impacts, but we're hoping that those sites
can be permitted very expeditiously....."
Meanwhile following through on a FERC request to expand its
pipeline system to California, El Paso Natural Gas filed a plan
last Thursday to add 230 MMcf/d of firm capacity by Aug. 31 to help
alleviate the energy crisis.
In an amendment to an existing application for the conversion of
the Plains All American Pipeline, El Paso said it was seeking to
change its crude-oil pipeline conversion project to an expansion of
its existing system. El Paso made the change in response to a
suggestion in January by FERC's Office of Energy Projects, which
said such a modification to the project "could assist the difficult
situation" now facing the California gas market.
Initially, El Paso had proposed its so-called Line 2000 project
as a loop line to replace compression that it planned to remove
from its system, and not as a system expansion. But the pipeline
told FERC that there has been a "radical change in the dynamics of
the natural-gas market in California." The energy crisis continues
in the region and there is an immediate need for additional volumes
of gas to serve growing electric generation, the pipeline said.
El Paso asked the Commission to give it the authority to begin
cleaning and converting a large segment of the 1,088-mile crude oil
pipeline by March 31, and to approve the overall expansion project
by mid-April. It hopes to have the expanded capacity in operation
by late August.
However, it is seeking FERC approval of a project that has no
signed contracts with customers for the proposed capacity. El Paso
plans to use the extra capacity to create system flexibility to
meet peak gas demand initially. The pipeline mentioned that it
plans to take a significant amount of capacity out of service for
testing this spring because of the explosion that occurred on its
system last fall. As a result the extra capacity is needed "as
quickly as possible."