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FERC Approves Project Connecting Transco, FGT Systems in Texas

FERC last Thursday issued a certificate to Dominion South Pipeline Co. LP., a new subsidiary of Dominion Resources, approving the construction of a small pipeline in Texas that would connect the mainline system of Transcontinental Gas Pipe Line with Florida Gas Transmission (FGT).

Dominion South said the project -- a five-foot, 12-inch diameter line with a capacity of 200,000 Dth/d -- would improve the efficiency of the Transco and FGT systems, and would offer customers more supply flexibility and diversity. The latter has become a top concern in the wake of the twin Gulf hurricanes, with customers facing curtailments due to damaged natural gas processing facilities.

The Dominion affiliate signaled the $2.26 million Transco-FGT connector line will be the first of several projects linking existing third-party pipelines that it will undertake.

Transco and FGT currently cross, but do not connect, in Matagorda County, TX. Dominion South's project calls for Transco to construct and operate about 200 feet of 12-inch pipe, extending from Transco's existing 14-inch line to the inlet of Dominion South's proposed five-foot line, while FGT will construct and operate approximately 100 feet of 12-inch pipeline from its existing 20-inch line to the terminus of Dominion South's proposed line.

Transco also will construct and operate a metering facility at the inlet to Dominion South's proposed system, and FGT will construct and operate an over-pressure valve at the terminus of Dominion South's proposed system. Dominion South said it will reimburse Transco $1.23 million to construct the 200 feet of interconnecting pipeline and metering facility, and pay Transco $1,500 a month, for 20 years, to operate the facilities. It also will reimburse FGT $297,697 for its part in the project.

Dominion South said it has entered into a long-term precedent agreement with affiliate Dominion Field Services Inc. for the entire capacity of the proposed pipeline project. Under the agreement, Dominion South would receive 200,000 Dth/d of gas from Transco to deliver to FGT on behalf of Dominion Field Services.

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