Pipeline Competition in Rocky Mountain Region Heats Up
Pipeline competition in the Rockies is heating up with a new
pipeline project launched last week by Williams and changes to a
planned extension announced by rival Trailblazer Pipeline.
Williams is holding a non-binding open season through Sept. 21
to solicit expressions of interest for firm transportation on the
proposed Western Frontier Pipeline from the Cheyenne Hub in
northeastern Colorado to Hugoton Station on Williams' Central
pipeline system in southwest Kansas. Western Frontier would be a
major new line, extending 320 miles with 13,000 hp of compression
and 540,000 Dth/d of gas transportation capacity.
"Additional natural gas supply options are vital in today's
increasingly competitive energy marketplace. We believe the Western
Frontier Pipeline would be a cost-effective way to bring
highly-competitive supplies from the Rockies into the
Midcontinent," said Kim Cocklin, vice president of customer service
& rates for Williams' Central and Texas Gas systems. Williams'
plans put the pipeline in service Nov. 1, 2003. The project's cost
has not been finalized.
The project would compete with another expansion proposed by
Trailblazer. Both are designed to bring increasing gas production
primarily from the Powder River Basin to markets in the
Midcontinent and Midwest regions. The Powder River is a relatively
new gas play in Wyoming and Montana where shallow coal-bed methane
deposits can be produced quickly and inexpensively. The basin has
been estimated to hold between 10 and 30 Tcf of gas reserves.
Production is expected to ramp up to more than 1 Bcf/d over the
next few years.
"In essence, both get gas down into the pipelines in the Midcontinent area,"
said Trailblazer's Ron Brown. Trailblazer just completed an open season for
an expansion/extension that was first announced in June (NGI, June
19). The project includes an expansion of its existing 436-mile pipeline
system, which runs from Colorado through Southeastern Wyoming to Beatrice,
NB. Trailblazer plans to install two new compressor stations, add additional
horsepower at compressor station 602 and perhaps construct some 36-inch loop.
In addition, the open season also was needed to test interest in a 149-mile,
24-inch diameter extension from Cheyenne, CO, to Glenrock, WY.
The extension project has been shelved, said spokesman Ron Brown. It would
have interconnected with Thunder Creek Pipeline, Kinder Morgan Interstate
Gas Transmission and Fort Union Pipeline at Glenrock, but plans by Colorado
Interstate and Wyoming Interstate, two Coastal Corp., subsidiaries, to expand
their existing Medicine Bow lateral forced the cancellation, said Brown (see
"Before we were offering to do either an expansion/extension or
just an expansion, but we're just going to come out with an
expansion project now of 300 MMcf/d," he said. "We're shooting for
"CIG is expanding their Medicine Bow lateral and they could have
that in quicker than we could do an extension of Trailblazer," he
explained. "They had an open season and were one year ahead of us
so we decided to just build an expansion."
CIG announced last week it plans to loop the existing Medicine
Bow lateral with 155 miles of 36-inch diameter pipe and plans to
add 14,340 hp of compression at a cost of about $168 million. The
additional facilities will boost capacity by 675 MMcf/d to 1.05
Bcf/d. The lateral extrends from the southern end of the Powder
River Basin near Douglas, WY, to Wyoming Interstate's mainline
southwest of Cheyenne, WY.
However, Brown said the market response to the Trailblazer
expansion project was "huge. We've been through several rounds and
people have exercised their management outs so what we're doing is
going out with a new open season that is binding. That is supposed
to come out this afternoon and run through Aug. 18."
Kinder Morgan Energy Partners, L.P. owns a two-thirds interest
in Trailblazer, with the other one-third interest owned by Enron
Trailblazer Pipeline Company, a subsidiary of Enron Corp.
Trailblazer is operated by Natural Gas Pipeline Company of America
(NGPL), a subsidiary of Kinder Morgan, Inc. To obtain more
information on the open season, shippers should contact Ron Brown
at (713) 369-9290.
A summary of Williams' Western Frontier project, including an expression of
interest form, is available at http://wgpcentral.twc.com/.
Additional information about the project also is available from Donny King,
manager of business development for Williams' Central system, at (270) 688-6968.