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Gulfstream Inks Deal with FP&L, Plans 35-Mile Lateral

Gulfstream Natural Gas System said that it will build a 35-mile, 30-inch diameter pipeline lateral from Martin County to Florida Power & Light's (FP&L) proposed 2,400 MW West County Energy Center in Palm Beach County under a new 23-year firm transportation agreement that FP&L signed. According to the deal, FP&L will have access to 345,000 Dth/d of firm of capacity on Gulfstream.

Brad Reese, Gulfstream's vice president of business functions, called it a "major milestone" for the pipeline company and for the state. "Not only does this agreement represent a timely and effective means of delivering needed natural gas supplies directly to FP&L's proposed new electric demand center, it also fully subscribes our pipeline's initial mainline capacity on a long-term basis."

Gulfstream now has 1.095 million Dth/d of firm capacity locked up under contracts with customers. The company expects to begin construction of the Phase III Extension in early 2008 with a targeted completion of summer 2008. However, FP&L's power project still requires approval from Florida Public Service Commission and the state Power Plant Siting Board.

The power project is designed to serve Palm Beach County, which has grown 30% in the last decade. FP&L's customer accounts have grown from fewer than 487,000 in 1990 to more than 675,000 in 2005. The company has been adding about 15,000 new customer accounts in Palm Beach County each year since 2000. Meanwhile, in neighboring Martin and St. Lucie counties, its customer base has increased by 21% since 2000.

Based on expectations of continued growth, FP&L plans to build two 1,200 MW natural gas-fired units on a 220-acre site. It expects a regulatory decision on the project by late summer. The first generating unit at the West Palm Beach County site is expected to be completed by 2009 and the second unit by June 2010. The cost of the project would be about $1.2 billion. FP&L serves four million Florida customers.

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