Wyoming Interstate Co. LTD, (WIC) a pipeline subsidiary of El Paso Corp., has filed an application to build a major supply lateral and mainline compression facilities to satisfy the growing demand for take-away capacity in the Uintah Basin in Utah.
WIC proposed the "Kanda Lateral and Mainline Expansion Project" to address the demand for additional pipe capacity to transport natural gas volumes from production areas in the Uintah Basin to other markets and the demand for additional mainline capacity sought by a major Uintah Basin producer, Kerr-McGee Oil & Gas Corp., the pipeline told FERC [CP:07-14].
The Kanda Lateral portion of the project calls for the construction of approximately 123 miles of 24-inch diameter pipeline and associated facilities, starting at a new interconnect with Kerr-McGee in Uintah County, UT, and delivering up to 406,000 Dth/d into WIC's mainline. The second part of the project, the mainline expansion facilities, would include the installation of two compressor units totaling about 20,620 horsepower inside affiliate Colorado Interstate Gas Co.'s Wamsutter Compressor Station at Sweetwater, WY.
WIC estimates that both components of the project will cost an estimated $143 million to construct. The El Paso pipeline has asked the Federal Energy Regulatory Commission to act on its application by May of next year so that it can place the facilities in service by January 2008.
Kerr-McGee has signed precedent agreements for 400,000 Dth/d of capacity on the Kanda Lateral for 15 years, and for 137,000 Dth/d of mainline expansion capacity from Kanda to Wamsutter for the first two years of the agreement, increasing to 150,000 Dth/d on the second anniversary of the in-service date of the mainline expansion facilities. At Wamsutter, Kerr-McGee would have access to a number a pipelines that serve the Midwest and eastern markets.
WIC has proposed an incremental rate for service on the Kanda Lateral facilities, but it requested that it be allowed to roll in the costs of the mainline expansion facilities at its next Section 4 rate proceeding.
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