Significantly increasing its presence in the Northeast, SempraEnergy’s marketing arm, Sempra Energy Trading, agreed Thursday tomanage the supply and delivery of gas to serve Southern ConnecticutGas Co.’s 158,000 customers. Terms of the one-year agreement werenot disclosed. Sempra will begin April 1.

“By helping Southern Connecticut improve its service, we will bemore able to help our own East Coast customers. The East Coasthas, is, and always will be one of our company’s main focus areas.”Sempra said. The company declined to say if similar deals were onthe way.

Sempra will manage and optimize transportation and storagecontracts with Algonquin Gas, Texas Eastern, Tennessee Gas,Iroquois, CNG, Transco, and National Fuel. It will manage about 37Bcf of supply, 4 Bcf of storage capacity and 162 MMcf/dtransportation capacity. The contract excludes SouthernConnecticut’s LNG and propane peaking facilities.

“Working with a major national entity in the energy tradingmarket, our contract with Sempra Energy Trading gives us the strongpotential to produce cost savings for our customers and increasedvalue for shareholders,” said Sal Ardigliano, a SouthernConnecticut spokesman.

Ardigliano views this move as a step to the next level. “We’vebeen doing this with our storage capacity for about four years.”Over that span, Southern Connecticut worked with companies such asTPC, and Dynegy. “We had success,” Ardigliano continued, “and nowit’s time to put all the assets into the pot.” He also saidSouthern Connecticut chose Sempra because it cleared all thehurdles during the selection process, including proven reliability,ability to work cooperatively, as well as extensive savingsresults. He said the one-year deal is an evaluation period, andthere is no guarantee Southern Connecticut will re-sign with Semprafor another contract. “We don’t make deals for eternity withanybody. Competition is too much of a good thing.”

The agreement still requires approval from the ConnecticutDepartment of Utility Control, but Southern Connecticut expects itto be done before the April 1 start date.

John Norris

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