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Iroquois Moves Forward with Expansion, Lateral Projects

After receiving expressions of interests this summer from potential shippers for more than 800,000 Dth/d of new firm transportation capacity on its mainline, Iroquois Gas Transmission said it will move forward with a much smaller expansion that will add about 100,000 Dth/d of new space downstream of its interconnect with Algonquin Gas Transmission.

The company has initiated the pre-filing process at the Federal Energy Regulatory Commission (FERC) and intends to file an application for the project in March. It's expected to be in service by November 2007.

"The question on any expansion is not necessarily who wants to be able to transport but who is willing to pay for it," said Jeff Bruner, vice president and general counsel at Iroquois. "[Consolidated Edison] in this case was actually willing to step up to the plate and sign a contract with us. The other thing is where they are going to get the gas. The capacity piece is obviously only one piece of the puzzle."

Consolidated Edison has signed up for the entire 100,000 Dth/d of proposed transportation capacity, which it will use to bring gas to New York City from the Millennium Pipeline upstream of Algonquin. The natural gas will originate in Canada. From the Canadian border, Millennium will transport it to Algonquin, which will then deliver it to Iroquois at Brookfield, CT. Iroquois will then transport the gas to ConEd at an interconnection station in Hunts Point, the Bronx, New York.

Millennium's Phase I project will extend 182 miles from Corning, NY, to Ramapo, NY. The project will stop short of the Hudson River, but will include an interconnection with Algonquin, which can deliver the gas to Iroquois.

The original design of Millennium included a river crossing that was approved by FERC. But the state of New York used its powers under the Coastal Zone Management Act to defeat the project. Millennium later amended its application with plans for a phased approach that would avoid crossing the river at least initially by using an alternative method to deliver gas to other pipelines that could route it to high demand areas in New York City.

Consolidated Edison and KeySpan signed up as anchor shippers on Phase I of the reconfigured Millennium project. ConEd opted to purchase 150,000 Dth/d of capacity initially with an option to increase that to 180,000 Dth/d after the first year.

"We're just picking up the gas at Brookfield, which is on the south part of our system," said Bruner. "This is a whole different ball game that receiving it up at Waddington, where we are bringing it all the way down our system. It avoids a lot of [constraints on Iroquois]. Our system for the most part is fully contracted. The system is running pretty much full out."

In order to handle this new increase in volumes, and to provide for additional volumes of 30,000 Dth/d starting in November 2007, Iroquois proposes to add cooling facilities at its Dover, NY, compressor station and to construct a new transfer compressor station with cooling facilities at Brookfield.

The pipeline also said it plans to file an application at FERC for a new pipeline lateral to Long Island that would serve the Long Island Power Authority (LIPA). The gas on that project would go to the 350 MW Caithness Long Island Energy Center combined-cycle power plant.

A final route for that project is still be evaluated. One proposed route for the 24-inch diameter lateral would extend 21.5 miles from the mainline in Smithtown to the Caithness facility in the Town of Brookhaven. The new pipeline will provide 50,000 Dth/d to the Caithness plant and an additional 200,000 Dth/d to other Long Island facilities. Assuming timely receipt of regulatory approvals, Iroquois' proposed lateral also is expected to be in service by the fall of 2007.

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