NGI The Weekly Gas Market Report / NGI All News Access

Industry Briefs

Italy's Eni has begun producing natural gas from its Longhorn field in the U.S. Gulf of Mexico (GOM), which will initially produce at a rate of approximately 200 MMcf/d, the company said. Longhorn is in Mississippi Canyon Blocks 502 and 546, 60 miles off the Louisiana coast. Eni operates the field with a 75% working interest, while Nexen Inc. holds the remaining 25%. Gas is being produced from four subsea wells in a water depth of 2,500 feet. The wells are connected to the Eni-operated Corral platform, previously known as Crystal. The platform has been fitted with a newly built production and compression facility with a processing capacity of 250 MMcf/d and 6,000 b/d of oil. The Longhorn project achieved its first production in about three years from the initial exploration discovery made in July 2006 (see NGI, Feb. 5, 2007), and was completed in less than two years from the sanction, Eni said. In addition to the Longhorn field, the Corral platform is being outfitted to increase liquids production capacity up to 12,000 b/d to accommodate the future tie-in of the Appaloosa oil field, which is owned 100% by Eni and is under development with production anticipated to start in 2010.

DTE Gas Storage has launched a binding open season for natural gas storage services at the Washington 10 storage complex, which is north of Detroit. The complex consists of 90 Bcf of high-deliverability storage with bidirectional interconnects to Vector Pipeline and Michigan Consolidated Gas Co. Customers would have access to the Chicago, Michigan and Dawn market hubs, the DTE Energy subsidiary said. Firm storage would be available beginning April 1, 2011 and/or April 1, 2012, for a term of 10 years or more. Different terms will be considered. The open season ends at 3 p.m. EST on Dec. 14. For more information on DTE's open season, contact Mark Bering at (313) 235-6531 or beringm@dteenergy.com.

Bellevue, WA-based Puget Sound Energy (PSE) has completed a $46.4 million gas system upgrade to improve reliability and increase capacity in the South King County area in Washington state. The project began in 2004 and has involved various station and related upgrades in addition to laying new pipeline, said a spokesperson for the combination PSE utility. PSE said it completed installation of the final 6.8 miles of 16.3 miles of 16-inch diameter pipeline that spans from PSE's limit station in Kent, WA, to a tie-in point in Federal Way, WA. The six-year project also included the construction of two limit stations and a district regulator in Kent. PSE first built the new Sequoia district regulator and installed 5.25 miles of 16-inch diameter pipeline between the district regulator and PSE's gate station in Black Diamond, followed by other station and pipeline construction projects that were spread over another four years. Gate and limit stations regulate the pressure of the gas.

The Idaho Public Utilities Commission (PUC) cut Spokane, WA-based Avista Utilities' retail natural gas utility rates in the state by 22%, or more than the utility had requested, for the company's 70,000 gas customers. The decrease reduces Avista's annual revenue by $18.8 million, but it does not impact company earnings; nor does an increase in the surcharge, according to the PUC. Regulators said a combination of reduced gas demand and an abundance of supplies have continued to drive down wholesale prices. Avista residential customers using the average 66 th/month will get a monthly reduction of about $16.44, or 21.93%. Large commercial customers will get a cut of about 25.9%.

Thanks to a recent deal with Chevron, Spain's Iberdrola will be able to supply the U.S. market with up to approximately 35.3 Bcf of natural gas annually via Cheniere's Sabine Pass liquefied natural gas terminal in Louisiana, the company said. The deal, which took effect in October, allows Iberdrola to unload one methane tanker a month in the United States. The gas is moved through the Kinder Morgan Louisiana Pipeline. The 133-mile pipeline, which transports gas from Sabine Pass to multiple pipeline interconnects, was authorized to increase its maximum allowable operating pressure from 0.72 to 0.8 design (see NGI, Oct. 12). It has 3.2 Bcf/d of capacity, which has been fully subscribed for 20 years by Chevron and Total (see NGI, June 22).

The American Petroleum Institute (API) published a new guidance document outlining current best-industry practices for the proper drilling and cementing of wells that are being hydraulically fractured. The document, "Hydraulic Fracturing Operations -- Well Construction and Integrity Guideline," is designed to ensure that shallow ground water aquifers and the environment are protected throughout the drilling, completion and production phases of a well's life, according to API. "The guidance document helps supplement and support existing state regulations to ensure that development of our nation's abundant natural gas resources is safe and effective," said API Upstream Director Doug Morris. A free .pdf of the guidance document is available at www.api.org/Publications/epstandards/. A hard copy may be purchased for $40 from www.api.org/publications or by calling IHS at (800) 854-7179.

Iroquois Gas Transmission System, L.P. announced that the third and final phase of its 08/09 Expansion Project, a 10,300-hp compressor unit, was placed in service on Nov. 1 as scheduled. The project, which included a 1.6-mile segment of 36-inch diameter pipe and two additional compressors that were installed earlier, will carry an additional 200 MMcf/d from Iroquois' interconnection with the Algonquin Gas Transmission System in Brookfield, CT to National Grid's local distribution system at South Commack, Long Island. The Iroquois system transports more than 1.5 Bcf/d of natural gas, primarily from Western Canada, into the Northeast.

The Oregon Public Utility Commission (PUC) approved a small general rate increase, which took effect Nov. 1, for Spokane, WA-based Avista Utilities' natural gas operations, but substantial decreases in wholesale gas costs will mean the net effect for residential customers is an average decrease in monthly bills of 13%, or about $10. Last July Avista filed its request with the PUC, seeking to raise its rates by 11.6% to pay for major capital projects including pipeline reinforcement projects throughout Oregon. The average residential customer using 52 therms will see monthly bills drop by $10, or 13%, said a PUC spokesperson.

©Copyright 2009 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1266
Comments powered by Disqus