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Guardian Pipeline Gets Nod from Wisconsin Utilities to Build 106-Mile Expansion

In an effort to provide natural gas customers with the necessary infrastructure to "support growth, choice and competition," Guardian Pipeline LLC said Tuesday it has signed precedent agreements with two major Wisconsin utility companies for expansion of transportation capacity in eastern Wisconsin.

The proposed project will expand and extend the existing Guardian Pipeline approximately 106 miles from its current terminus near Ixonia in northeastern Jefferson County to the Green Bay area. The expansion, which is expected to cost between $200-250 million, would bring an additional 537,200 Dth/d of capacity to Wisconsin.

The original Guardian Pipeline is a 141-mile interstate natural gas pipeline that went into service in December 2002 (see Daily GPI, Dec. 10, 2002). The pipeline transports natural gas from the Joliet, IL hub to a point west of Milwaukee.

Wisconsin Public Service Corp., a subsidiary of WPS Resources Corp., headquartered in Green Bay, and Milwaukee-based We Energies, the utility segment of Wisconsin Energy Corp., entered into transportation precedent agreements to support the expansion. The companies will be the major shippers on the new pipeline project.

"We are pleased with the decision of these two major utilities to support an expansion and extension of Guardian to bring much needed natural gas transmission capacity and competition to the eastern part of Wisconsin," said Rich Gielecki, president of Guardian.

The selection of Guardian to supply new transportation capacity was the result of a 15-month competitive process. Guardian responded to a bidding process begun in 2004 by the Wisconsin utilities. The pipeline said it plans to submit an application to the Federal Energy Regulatory Commission as part of a process that will include communication with property owners along the planned route, town hall meetings and an environmental review process. Following FERC approval, the construction process could begin in early 2008, Guardian said.

"Expanding natural gas transmission capacity is vital to the state's economic development and long-term competitiveness," said Gielecki. "Since Guardian went in service a little more than three years ago, 98% of our capacity is subscribed. Since existing pipelines are nearly at capacity, there is virtually no capacity to accommodate increased demand without expansion."

In addition to increasing transmission capacity, Guardian Pipeline said the expansion will also provide improved system reliability from a second gas transmission company.

"The existing Guardian Pipeline already has delivered on its promise of supplying greater choice and competition for customers in southeast Wisconsin," said Gielecki. "Guardian continues to be customer-driven and has a clear focus on Wisconsin's future. This second phase will build upon that foundation and provide improved reliability to meet the state's energy needs."

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