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Industry Briefs

Enbridge Energy Partners LP launched plans to expand its East Texas Gas Gathering System by increasing takeaway capacity from the Texas portion of the Haynesville Shale by 900 MMcf/d. The Haynesville Shale Project, to be constructed at an estimated cost of $141.8 million, includes 50 miles of 16- to 24-inch diameter pipe, all in the East Texas counties of Shelby, Nacogdoches and San Augustine, as well as an additional 38-mile, 24-inch diameter lateral from Shelby County to Carthage, TX. Enbridge also is considering adding a treating facility and additional compressor units to boost capacity out of the area. For information contact Steve Marsh at (713) 821-2084, or steve.marsh@enbridge.com, or Pat Martin at (713) 821-2159, or pat.martin@enbridge.com.

Looking to capitalize on the growing need for natural gas storage in the prolific Marcellus Shale region of Pennsylvania, Valley Forge, PA-based UGI Corp. said its UGI Central Penn Gas Inc. (UGI CPG) and UGI Storage Co. subsidiaries are conducting a binding open season for 14.7 Bcf of firm underground storage service from three existing storage fields. The fields are near the Marcellus Shale in Tioga, Potter and Cameron counties. UGI CPG's storage fields have interconnections to Dominion Transmission, Transcontinental Gas Pipe Line, National Fuel Gas Supply, Tennessee Gas Pipeline and UGI CPG's distribution system. UGI said service is being offered for the injection season starting April 1 with withdrawals the subsequent winter, Nov. 1, 2010 through March 31, 2011. The open season ends March 1. UGI Storage filed with the Federal Energy Regulatory Commission requesting authorization to acquire and operate the storage facilities, which are currently owned by UGI CPG. For a bid package contact Andrew Franco at (610) 796-3522 or by e-mail at afranco@ugi.com. More information is at www.ugistorage.com.

EV Energy Partners LP (EVEP) and partnerships managed by EnerVest Ltd. agreed to pay Range Resources Corp. $330 million to acquire some tight gas sands property and producing wells in the Ohio portion of the Appalachian Basin. The properties to be acquired include 3,306 active wells (3,018 operated), which are 75% proved developed producing (58.7 Bcfe). The transaction also includes about 1,600 miles of pipeline and gathering system infrastructure. More than 90% of the property, 70% weighted to gas, is held by production. Under terms of the transaction, EVEP would acquire a 46.15% interest in the properties for $151.8 million; partnerships managed by EnerVest will acquire the remaining stakes.

Calgary's Suncor Energy Inc. reached an agreement with Progress Energy Resources Corp. to sell noncore natural gas properties in British Columbia (BC) for C$390 million. The properties, known as Jedney, Beg and Blueberry, currently produce around 43.8 MMcfe/d, Suncor said. The assets are located about 125 kilometers northwest of Fort St. John, BC. As part of its strategic business alignment following its merger with Petro-Canada in 2009, Suncor plans to sell packages of noncore assets, including most of its gas assets, to keep its focus on oilsands (see NGI, Nov. 16, 2009). The BC sale is expected to close at the end of March.

Houston-based Buckeye Partners LP and Calgary-based NOVA Chemicals Corp. have agreed to explore the potential for a mixed natural gas liquids (NGL) pipeline from the Marcellus Shale in Pennsylvania to the refining and petrochemical complex in the Sarnia-Lambton area of Ontario, Canada. The partners' Union Pipeline Project, which is subject to final agreements and regulatory approvals, would ship mixed NGLs, principally for use as petrochemical feedstock, the companies said. The Union Pipeline would diversify refining and petrochemical feedstock supply for NOVA Chemicals and other potential users in the area and provide producers in the Marcellus Shale with takeaway capacity for their NGLs to the closest demand center, the companies said. Initial service would be from Pittsburgh to the NOVA Chemicals Corunna olefins cracker near Sarnia. Buckeye would develop, construct, own and operate the pipeline and would conduct an open season to solicit customer interest.

ExxonMobil Production Co. has successfully drilled and cased the first of two development natural gas wells for its Point Thomson project on Alaska's North Slope to a targeted gas reservoir more than 1.5 miles under the Beaufort Sea. Point Thomson is a remote natural gas and condensate field that holds an estimated 8 Tcf of gas -- about a quarter of the North Slope's gas resources -- and about 200 million bbl of condensate. The PTU-15 well was drilled to a measured depth of more than 16,000 feet, ExxonMobil said. A 60-mile ice road from Endicott, AK, to Point Thomson also was completed to transport materials and equipment to the site. The rig for PTU-15 is to be moved to the second development well, PTU-16, at Point Thomson to continue drilling. Work also continues on front-end engineering and design for the initial production system. The project is scheduled to begin production in 2014.

Complaints from area residents have prompted the Pennsylvania Public Utility Commission (PUC) to increase its enforcement presence in the five-county area of northeastern Pennsylvania connected to the Marcellus Shale, the agency said. The move was sparked by complaints involving carriers transporting commodities without a PUC certificate. Complainants also alleged that several carriers were violating the PUC's hours of service regulations. Increased inspections are taking place in Tioga, Bradford, Sullivan, Wyoming and Susquehanna counties to ensure that motor carriers are complying with regulations, the PUC said. Trucking companies are required to have a PUC property certificate and proof of insurance if they are involved with transporting commodities related to natural gas operations, such as water, sand and stone. Carriers operating without the certificate and insurance can be subject to penalties. Carriers violating safety regulations that pertain to the drivers and equipment can be cited and placed out of service.

The National Oceanic and Atmospheric Administration (NOAA) is creating a climate service office dedicated to bringing together NOAA's climate science and service delivery capabilities, Commerce Secretary Gary Locke said. Thomas Karl, director of NOAA's National Climatic Data Center in Asheville, NC, will serve as NOAA Climate Service's transitional director. Six regional directors will be announced soon and the creation of the new office should be completed by the end of the year. Planning is being shaped by input from NOAA employees and stakeholders across the country, with close consideration given to the recommendations of the NOAA Science Advisory Board, National Academies and National Academy of Public Administration. NOAA also unveiled www.climate.gov, a website that will serve as a single point of entry for NOAA's extensive climate information, data, products and services.

SCANA Corp. trimmed operating and maintenance expenses by $15 million in 4Q2009, but the cost-control measures were not enough to offset electric margin erosion, dilution and reduced income from asset sales in 2008. The Cayce, SC-based company last week reported 4Q009 earnings of $76 million (62 cents/share), an 11.6% decline compared with $86 million (73 cents) in 4Q2008. SCANA's North Carolina-based retail natural gas distribution subsidiary, PSNC Energy, 4Q2009 earnings of $20 million (17 cents/share), compared with $19 million (17 cents) in 4Q2008. SCANA Energy, the company's retail natural gas marketing business in Georgia, reported 4Q2009 earnings of $9 million (7 cents) compared to $12 million (10 cents) in 4Q2008. Carolina Gas Transmission Corp. reported earnings of $2 million (2 cents) compared with $2 million (1 cent) in 4Q2008. SCANA's preliminary earnings estimate for 2010 is $2.85-3.05/share. The company continues to target an average annual earnings growth rate of 4-6% over the next three to five years.

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