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Rockies Express Pipeline (REX) has pushed back the in-service date of interim delivery points on REX-East to the second half of June. Previously REX said service would begin in the first half of June (see NGI, May 18). REX said it anticipates commencing service on REX East to Lebanon, OH, in mid to late June. The pipeline affirmed its projection for service to Clarington, OH, on Nov. 1. Initial service to Lebanon is expected to offer capacity of 1,600 MDth/d, which is expected to increase to 1,800 MDth/d. Ultimately, 1,800 MDth/d of capacity is to be available to Clarington as well, REX said. For more information visit, "Rockies Express -- East," "REX-East -- Informational Posting."

The Federal Energy Regulatory Commission issued a favorable environmental review of Rockies Express Pipeline's (REX) proposal for compressor additions to expand capacity between Meeker Hub and Cheyenne Hub on the REX/Entrega leg of the 1,679-mile west-to-east system. The proposed Meeker-to-Cheyenne expansion would accommodate EnCana Marketing USA Inc.'s contractual ramp-up in rights to increase its capacity on only the 327-mile REX/Entrega portion of the pipeline, which provides takeaway capacity out of supply basins in Colorado and Wyoming to the Cheyenne Hub in Weld County, CO. The project application, which was filed in February, seeks to increase the capacity from Meeker Hub in Rio Blanco County, CO, to Wamsutter Hub in Sweetwater County, WY, by approximately 200 MMcf/d to 1.3 Bcf/d, and the capacity from Wamsutter to Cheyenne Hub would ramp up, upon completion of the REX-East project facility later this year, to 2 Bcf/d from 1.8 Bcf/d, according to REX.

TXCO Resources Inc., which has been struggling to remain afloat for months, has filed for voluntary bankruptcy under Chapter 11. The filing, said the independent, was "precipitated by a series of events that led to a contraction" in liquidity. CEO James Sigmon said in March that the company had run out of money and had pledged most of its assets to creditors (see NGI, March 23). As part of the bankruptcy filing, TXCO said it filed several first-day motions with the U.S. Bankruptcy Court for the Western District of Texas to allow it to continue to conduct business without interruption. "During the reorganization process, suppliers should expect to be paid for post-petition purchases of goods and services in the ordinary course of business," TXCO said.

The Federal Energy Regulatory Commission has issued a draft environmental review of Downeast LNG Inc.'s proposal for a liquefied natural gas (LNG) import terminal in Robbinston, ME. "We conclude that construction and operation of the Downeast LNG project would result in some adverse environmental impacts. However, most of these impacts would be reduced to less-than-significant levels with the implementation of Downeast's proposed mitigation measures and the additional measures we recommend," FERC staff and cooperating agencies said [CP07-52, CP07-53]. Downeast LNG proposes to import on average about 500 MMcf/d of LNG with peak deliveries of 625 MMcf/d at terminal facilities on the south side of Mill Cove in the Town of Robbinston in Washington County, ME. A proposed sendout pipeline would transport gas from the LNG terminal to an interconnect with Maritimes & Northeast Pipeline LLC (M&NE) near the town of Baileyville, ME.

PAA Natural Gas Storage LLC (PNGS) is holding a nonbinding open season for 2 Bcf of firm gas storage service to be available in the second quarter of 2010 at its Pine Prairie salt-cavern storage facility in Evangeline Parish, LA. PNGS is constructing phase I development at Pine Prairie, which consists of three storage caverns with total permitted working capacity of 24 Bcf. Cavern wells one and two have been placed into service with current total working capacity of approximately 14 Bcf. Cavern well three is expected to come on line in the second quarter of 2010. Interested parties should contact Richard Tomaski at (713) 652-3669 or Brad Ledbetter at (713) 652-3671 or visit The open season will end at 2 p.m. CDT on June 18.

In a vote that mattered mostly for what it said, a majority of Royal Dutch Shell plc shareholders rejected the pay packages of senior executives at the annual shareholder meeting. The packages allowed bonuses to be awarded even though the company failed to meet some of its performance targets. More than 59% of the shareholders rejected the measure. However, the vote was only advisory and does not invalidate the earlier approval of the packages by Shell's remuneration committee, the company said. According to Shell, the remuneration committee was allowed to use its discretion to award the bonuses. The difference between Shell's performance and that of what it considers its closest peer company, Total SA, was "negligible," Shell said.

Enbridge Inc. has completed a successful nonbinding open season for its proposed interstate LaCrosse Pipeline, which would carry 1-1.8 Bcf/d of growing regional gas supplies from the company's Carthage Hub in East Texas to an interconnect with Southern Natural Gas in southeastern Louisiana. The nonbinding open season was launched in mid-April. As proposed, LaCrosse would include 300 miles of 42- and 36-inch diameter pipe, interconnecting with five or six interstate pipelines and up to 12 pipeline interconnections, depending on shipper interest. Enbridge also was exploring the possibility of extending the pipeline to Florida Gas Transmission's Station 10 near Wiggins, MS. As planned, the proposed project would be completed in late 2011 or early 2012.

To help fund the corporation's planned growth, TransCanada Corp. is selling its North Baja Pipeline LLC to affiliate partnership TC PipeLines LP for US$395 million. TransCanada acquired the North Baja Pipeline system in 2004; it would continue to operate the pipe once the ownership is transferred. The 80-mile natural gas pipeline extends from southwestern Arizona to a point on the California/Mexico border and connects with a system in Mexico. North Baja consists of 30- and 36-inch diameter pipeline with a capacity of 600 MMcf/d. The transaction would net TransCanada US$200 million in cash and give it an additional 6.37 million common units in the partnership. Once the transaction closes, which is expected by the end of June, TransCanada's ownership of the partnership would increase to 42.6%.

CME Group has completed its New York trading floor integration of energy and metals futures and options, "a key milestone" following its 2008 acquisition of Nymex Holdings, parent of the New York Mercantile Exchange (Nymex). The integration was completed in two phases: first the reconfiguration of the energy trading floor in April, and combining the trading rings into one trading floor last week. The combined New York trading floor, which represents CME Group's continuing commitment to New York City as a global financial center, is now home to open outcry trading for Nymex and Comex futures and options, including crude oil, natural gas, heating oil, gasoline, gold, silver, copper, platinum and palladium. CME Group expects its integration of Nymex to be substantially complete in 4Q2009.

Sempra Energy's Los Angeles-based Southern California Gas Co. (SoCalGas) utility said it is holding more than $20 million for rebates and incentives to business customers for qualifying energy efficiency projects in 2009. It is the largest pool of incentive money in the utility's history. SoCalGas passed on this information to more than 300 of its business customers at its fourth annual Energy Efficiency Expo in Downey, CA. Included in the program were panel discussions, including one with customers who have taken advantage of the utility largesse in the past, qualifying for rebates, incentives, free on-site energy efficiency assessments and zero-interest financing programs. SoCalGas Customer Programs Director Mark Gaines said the higher funding levels this year will help the utility benefit both the environment and its customers in a weak economy, no less.

StatoilHydro ASA, which owns substantial reserves both on- and offshore in the United States, is getting a new name -- Statoil -- following approval by officials. The proposal to change the name of the national oil company, which is 67% owned by Norway, was suggested by the board of directors. Also approved was a proposal to widen the producer's objectives to include other energy besides oil and natural gas to reflect its investments in renewable energy. The amendments are expected to be implemented by the end of the year. Norway's Statoil ASA and Norsk Hydro ASA proposed a merger in late 2006 (see NGI, Dec. 25, 2006).

Federal gas and oil inspection and enforcement programs still lag the pace of energy development, according to a report released by the Western Organization of Resource Councils (WORC). The organization, which claims the money spent on inspections and the number of inspections conducted by the Bureau of Land Management (BLM) were too low in 1999, acknowledged some improvement in BLM inspection and enforcement programs since then -- but said the programs "have barely kept up with oil and gas permitting and drilling." According to the report, six BLM field offices in Colorado, Montana, New Mexico, North Dakota and Wyoming conducted just 15% of required environmental inspections of wells near areas of special environmental concern or with a history of noncompliance in 2007. WORC called on congress to fully fund the BLM's inspection and enforcement program and said BLM should strengthen its national inspection and enforcement strategy.

The Department of Transportation (DOT) has issued an advisory warning owners and operators of natural gas and hazardous liquid pipelines of the potential that high-grade line pipe used in recent projects may have been substandard. "During pipeline construction in the late fall of 2008, several recently installed natural gas transmission pipeline systems experienced field hydrostatic test failures or excessively expanded pipe joints of large-diameter, microalloyed high-grade line pipe. Tests of the pipe have shown it to have substandard yield strengths, tensile strengths and/or chemical compositions," the DOT's Pipeline and Hazardous Material Safety Administration (PHMSA) said in the advisory, which was published in the Federal Register. The PHMSA advised owners and operators of in-service pipelines to conduct thorough examinations to ensure that inconsistent mechanical and chemical properties are not inherent in microalloyed line pipe grades on all API 5L--PSL 2, X70 and X80 line pipe installed in recent construction projects.

Rep. Maurice Hinchey (D-NY) has called on the head of the Environmental Protection Agency (EPA) to review the agency's policy on the risk of hydraulic fracturing -- where chemicals are used to stimulate oil and natural gas production -- to the nation's drinking water. Hinchey, who advocates closing the loophole that exempts hydraulic fracturing from the Safe Drinking Water Act (SDWA), made the plea during a congressional hearing, where EPA Administrator Lisa Jackson testified. "While there is value in drilling for natural gas, it's imperative that we do so in a manner that doesn't have long-term environmental consequences on our drinking water," Hinchey said. The Energy Policy Act of 2005 exempted hydraulic fracturing from the SDWA, which seeks to protect the public water supply from contamination from toxic materials.

Encore Energy Partners LP (EEP) plans to increase its daily oil and natural gas production by 926 boe/d through two separate transactions in the Vinegarone Field in Val Verde County, TX, and the Williston Basin in Montana and North Dakota for nearly $54 million. The $28 million cash acquisition of the Vinegarone Field gas-producing properties was reached with an independent energy company, while the $25.8 million cash Williston Basin deal for oil and gas producing properties was reached with EEP's parent company, Encore Acquisition Co. The acquisitions were effective April 1 and are expected to close by June 1. Total proved reserves of the combined acquisition are 4.4 million boe -- 64% gas -- with 97% proved developed. The Vinegarone properties include shallow-declining mature assets that produce from the Strawn formation of the Permian Basin. The properties have estimated proved developed reserves of approximately 2.4 million barrels boe, 100% of which are proved developed producing and 100% of which are natural gas. The properties currently produce approximately 3 MMcf/d. The Williston Basin properties produce from 13 different fields in Montana and North Dakota and include more than 100 producing wells, according to EEP. The properties currently produce approximately 419 boe/d.

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