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Stingray Pipe Gets FERC Waiver to Move Shut-In Gulf Production

FERC has approved a temporary tariff waiver clearing the way for Stingray Pipeline Co. to deliver natural gas production that has been shut in off the coast of Louisiana since Hurricane Rita struck last month.

The Enbridge-owned Stingray, in seeking the waiver, noted it has taken steps to modify the historical operation of its system to allow shippers to divert and deliver their gas supplies from Stingray to an offshore interconnection with GulfTerra Energy Partners' High Island Offshore System (HIOS), according to the FERC order [EM06-2]. The modified operation of the Stingray system, which gathers gas from several Gulf platforms and delivers it onshore, was expected to take effect as early as Oct. 15, it noted.

From HIOS, Stingray shippers can deliver their gas into ANR Pipeline, which is accepting some nominations. The HIOS system also has the ability to deliver gas to Enbridge's U-T Offshore System, but those facilities currently are being repaired and are not expected to be back in service until November.

By using the HIOS interconnection, a pipeline official said Stingray would be able to flow about 150-200 MMcf/d of production that is currently shut in. The pipeline told FERC that it intends to operate its pipeline system in this manner until the earlier of the date on which its Louisiana separation/dehydration plant is fully operational or the end of the 2005-2006 winter heating season. Prior to Rita, the deliveries on the 325-mile Stingray system were about 1.12 Bcf/d.

Gulf gas production on the Stingray system was shut in in the wake of Rita due to damage to the pipeline's plant in Johnson Bayou, LA, which provides gas liquids separation, dehydration and compression at the terminus of the Stingray system, the order noted.

"Stingray asserts that once it commences deliveries from Stingray into the HIOS system, only a small portion of Stingray's normal flows will be restored. That is because not all of Stingray's normal flows can reach Stingray's interconnection with HIOS. In addition, a large portion of production that is shut in on the Stingray system is currently unable to come back online because of damage to production platforms and other production-related facilities," the order said.

Responding to an emergency request filed Oct. 14, the Federal Energy Regulatory Commission granted Stingray a waiver of its tariff so that shippers not flowing gas during the period wouldn't be required to bear the costs of lost and unaccounted for (LAUF) gas quantities created during that time.

"Stingray has proposed a reasonable method of permitting production of significant gas supplies that would otherwise remain shut in due to damage to the Stingray plant as a result of Hurricane Rita," FERC said in granting the waiver.

"The requested waiver...will allow Stingray to allocate its LAUF costs to those shippers who benefit from the revised operation of Stingray's system and avoid an inequitable allocation of those costs to shippers who are unable to flow gas during this period," the order noted.

"The Commission intends to do everything it can to help alleviate the problems caused by Hurricane Katrina and the subsequent Hurricane Rita...At the same time, it does not wish to act precipitously. Therefore, if any entities believe themselves to be adversely affected by our action here we urge them to make prompt filings with us, so that we can address their concerns," FERC said.

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