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FERC Approves Dominion's REX-Related Project

FERC last Wednesday approved an expansion of Dominion Transmission Inc.'s pipeline system that will provide takeaway capacity to eastern markets for the Rockies natural gas delivered by Rockies Express Pipeline (REX).

The project calls for Dominion to construct a 4,740-hp compressor station (Rock Springs Compressor Station) and two small pipelines in Westmoreland County in southwestern Pennsylvania. One of the pipelines would extend from Dominion's existing Oakford Compressor Station to the proposed Rock Springs Compressor Station, while the second line would extend from the Rock Springs station to a proposed meter station and interconnection (Delmont Interconnect) with Texas Eastern Transmission Co.

The Dominion Hub I expansion would provide up to 200,000 Dth/d of firm transportation capacity in summer months and 150,000 Dth/d during the winter, according to Dominion Transmission, a subsidiary of Richmond, VA-based Dominion Resources. The project, which has an estimated price tag of $34.4 million, is expected to go into service by Nov. 1, 2009.

Dominion said the proposed expansion is intended to facilitate the arrival of Rockies natural gas supplies transported over REX. The last leg of the REX project -- REX-East -- will be phased into service next year, with 1.6 Bcf/d of capacity scheduled to go into service by Jan. 1, 2009, and the full 1.8 Bcf/d due to become operational by June 30, 2009.

As part of the REX-East project, three delivery points into Dominion's pipeline system are proposed to be constructed in Ohio at Lebanon, then at Noble and finally at the project terminus in Clarington.

Dominion said it has executed a precedent agreement with BP Energy Co. for an initial term of 10 years for the full capacity to be created by the expansion.

The Federal Energy Regulatory Commission (FERC) granted Dominion's request to roll the costs of the project into its next Section 4 rate proceeding, absent a material change in circumstances.

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