ANR Pipeline has yet to decide whether to proceed with expansionof its Eugene Island system in the Gulf of Mexico in the wake of aFERC order upholding a previous decision that approved the projectbut put ANR at risk for its cost. “I think all I can say at thispoint is we’re continuing to review the order and consider ouroptions,” an ANR spokesman said Friday.

ANR invoked the Ashbacker doctrine and maintained its projectwas so similar to one proposed by Nautilus Pipeline, now completed,that the two were mutually exclusive. The FERC disagreed and gaveboth the go-ahead (ANR pending final environmental review), sayingthe market would sort things out. The FERC’s most recent ordernotes ANR has yet to show firm commitment to its project fromshippers, and the ANR spokesman said he didn’t know if the companyhad received any.

“The Commission acted in a manner consistent with thepro-competitive regulatory policies it has adopted over the lastdecade by relying on a market oriented approach to providecustomers with alternatives for pipeline transportation through anexpanded offshore natural gas transportation infrastructure.

That approach is based on the view that the general market fornatural gas and the requirements of shippers in the Gulf, as wellas the needs of customers onshore, should determine the appropriatescope and configuration of offshore pipeline development. Inconsidering both projects, the Commission sought to promote theorderly development of the Gulf Coast reserves without anyunnecessary delay.”

The proposal from ANR included 37 miles of mainline loop fromEugene Island Block 63 along ANR’s existing pipelines extendingnorthward to ANR’s existing onshore Patterson compressor station.

The mainline expansion would give ANR ability to provide up to461 MMcf/d of additional incremental firm and interruptibleservice. Both ANR and Nautilus targeted the same customer, MantaRay Offshore Gathering, which ANR said would need at least 500MMcf/d more capacity to fully utilize its own project and that ofNautilus.

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