El Paso, Duke Reveal Competing Long Island Pipe Projects

Two dueling pipeline projects from New England to Long Island, NY, unveiled open seasons last week. Tennessee Gas Pipeline Co., an El Paso unit, is planning one line, the Connecticut-Long Island Pipeline, while Duke Energy Gas Transmission (DEGT) and KeySpan Energy Delivery Long Island (KEDLI) are partnering on the competing project, called Islander East. Open seasons on both will conclude Feb. 28.

"I don't think that both projects can co-exist," said Pat Whitty, managing director with DEGT. "There appears to be only enough market to support one northern alternative pipeline into New York at this time."

The Tennessee project would provide up to 450,000 Dth/d of new transportation capacity from the company's interconnection with joint facilities of Maritimes & Northeast Pipeline and Portland Natural Gas Transmission System Co. in Dracut, MA, and terminate in Suffolk County on eastern Long Island.

The proposed 40-mile Islander East line is expected to carry 250,000 Dth/d from an interconnection with DEGT's Algonquin Gas Transmission system in Connecticut. Firm transportation services offered will be provided on a non-discriminatory, open access basis, DEGT said. The proposed pipeline project will be equally owned by DEGT and KEDLI under a limited liability company, Islander East Pipeline LLC.

Tennessee said its project will deliver to various local distribution companies and their facilities, including Yankee Gas Services, Connecticut Natural Gas, Southern Connecticut Gas and KeySpan Energy Delivery Long Island, as well as directly to proposed power generating plants along the way.

"This project maximizes the opportunities to deliver energy to critical regions by optimizing the existing pipeline and transportation assets located in these areas," said Stephen C. Beasley, president of Tennessee Gas Pipeline. "A cost effective and competitive pipeline linking New England and New York will increase flexibility, reliability and liquidity for natural gas consumers in these markets."

Islander East would extend from Connecticut across Long Island Sound to Wading River, NY, and other points on Long Island, where it would connect with KEDLI. The companies believe the time is right for Islander East because it would have access to almost every major supply basin in North America, including the recently developed Sable Island off the coast of Nova Scotia in Atlantic Canada. Its backers said it would be possible through Algonquin's proposed interconnection with Maritimes & Northeast.

"Islander East enhances KeySpan's position as a major energy supplier in the Northeast. The pipeline will dramatically increase and diversify our access to gas supplies, enhance the competitive price of gas for our customers in the Northeast, and help reduce the cost of electric-power production," said Robert B. Catell, CEO of KeySpan. "It will also mean greater energy reliability, flexibility and security for energy consumers on Long Island and in the New York City area."

"Demand for natural gas in Long Island and New York City is growing at a greater rate than anywhere else in the country and Islander East will deliver critical supplies of natural gas to those areas," said Robert Evans, president of DEGT, who will also be the project manager for Islander East. "This growth is expected to continue over the next several years as more homes convert to natural gas and as gas-fired electric generating plants are built on Long Island."

Pending the outcome of both open seasons, The companies said they both expect to have their pipelines operating sometime during 2003. Interested shippers on the proposed Tennessee line should contact Joe Wyzik with El Paso at 713-420-2369, while shippers seeking information about the Islander East project can contact Pat Whitty with DEGT at 617-560-1447.

Alex Steis

©Copyright 2001 Intelligence Press, Inc. All rights reserved. The preceding news report may not be republished or redistributed in whole or in part without prior written consent of Intelligence Press, Inc.