Transco Official Blasts FERC's PD Decision
In a terse letter to FERC last week, Cuba Wadlington Jr.,
Transcontinental Gas Pipe Line's senior vice president and general
manager, became the first pipeline representative to formally
criticize the Commission's recent departure from its long-standing
policy of issuing preliminary determinations on pipeline expansion
applications. Wadlington said Transco officials are disappointed
about the decision, which affects their MarketLink project, the
proposed Independence Pipeline - in which Transco is a partner -
the upstream ANR-sponsored SupplyLink project and the competing
Millennium Pipeline project.
In a 3-2 vote at its March 10 meeting, FERC broke with the
decade-old procedure in its review of the four controversial
pipeline projects intended to carry Canadian gas from the U.S.
Midwest to the northeastern gas market. It deferred action on the
fate of the projects until all of the environmental reviews are
completed because of the wide range of issues and concerns they
raised - specifically, the unparalleled level of landowner
opposition, questions about market "need" and "significant and
difficult" environmental concerns.
The "confluence" of the issues calls for "decision-making that
affords us the ability [to consider] the whole record at one time,"
Chairman James Hoecker said at the time. FERC needs to be able to
"balance all the interests and concerns" - public interest,
economic, landowner and environmental - in one fell swoop.
But Wadlington told the Commission its decision "substantially
increases the business risks on the pipeline sponsors as they
continue to make significant financial and contractual commitments
necessary to maintain the Nov. 1, 2000 in-service dates without the
benefit of regulatory guidance on the fundamental business
proposals." Wadlington said in light of these increased business
risks "it is imperative" that the Commission hand down a decision
by September as promised.
He added the projects were planned based on well-established
regulatory practices and should not now be delayed while the
Commission considers changing those practices.
In the meantime, however, the Commission's action appears to
have had little impact on the demand for MarketLink's capacity or
the ability of Transco's parent Williams to continue marketing the
proposed project. Williams announced yesterday it signed up another
major customer. Sunset Energy Fleet LLC signed a 15-year agreement
for 95,600 Dth/d of firm capacity on the pipeline to supply a 520
MW power generation plant in New York City.
MarketLink is a $528 million expansion of Transco's pipeline
system from the Leidy Hub in western Pennsylvania to New York City.
The project would add 700,000 Dth/d of capacity.
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