Pipe Expansions Planned for Rockies Region

With several pipeline companies well into addressing the pipeline capacity shortages that persist as natural gas production grows throughout the Rocky Mountain region, Kinder Morgan Interstate Gas Transmission LLC (KMIGT) announced two major projects Wednesday, and several other companies detailed expansions planned or in the works during the closing session at the 13th Annual Rocky Mountain Natural Gas Strategy Conference.

Headlining the news was KMIGT's plans to use existing rights-of-way to build the Advantage Pipeline, which would fill the same needs as the Colorado Interstate Gas pipe, moving from the Cheyenne Hub to the Mid-Continent. An open season is scheduled on the proposed pipe this fall.

Dave Scharf, business development director for KMIGT, said the 24-inch pipe, which would move gas primarily from the Powder River Basin, would have a capacity of 330 MMcf/d, delivering to interconnects on its way to the Kansas City markets.

"It would have a smaller size, with about 40% less content," Scharf said, but it would be expandable to 450 MMcf/d, with access to liquid Mid-Continent pipes, local distribution centers and end-use markets.

A smaller pipeline, NECO -- a 12-inch pipe, about 95 miles long -- would serve the northeastern Colorado market. Although small, Scharf emphasized that it would reduce some of the bottlenecks now evident in moving gas in that part of the state, and would also allow backhauls to Cheyenne. An open season on this line is also scheduled this fall, Scharf said.

KMIGT also is planning to expand its storage capacity in the Rockies, adding more horsepower at the Cheyenne Hub and Huntsman facility. The Huntsman would be expanded to deliver 75 MMcf/d, with delivery at Cheyenne of 45 MMcf/d.

"We want to customize shippers' needs," Scharf said of the expansion. Noting there were synergies between the three projects, he said KMIGT was on a growth plan that would use both acquisitions and expansion. "Rocky Mountain growth opportunities we see are in Wyoming, Colorado, Kansas and Nebraska," he said.

El Paso's Craig Coombs, who directs project development for the company's Western Pipeline Group, said El Paso also is expanding its pipelines east from the Rockies, with a Cheyenne to Mid-Continent connection, spending $380 million to add 540 MDth/d. The open season for this expansion ended July 20, said Coombs, and he said El Paso is now negotiating with shippers. A FERC filing is scheduled for December 2001, with an in-service date in late 2003 or early 2004.

Coombs also updated attendees on the CIG expansion along the Front Range of the Rockies, which he said is on track to be in service by mid-2004. Over the next four years, Coombs said supply from the Rockies would grow from 5 Bcf/d to 7.5 Bcf/d, and warned there would be "blood on the streets" if pipeline systems are not expanded.

Coombs said El Paso planned to file its request with the Federal Energy Regulatory Commission in January 2002 for its Ruby pipeline, which is scheduled to carry 250 MDth/d from the Rockies into Nevada and 500 MDth/d into California. The Ruby project, said Coombs, "is designed with power plants in mind." The pipeline will be 30-36-inches with 40,000 horsepower.

El Paso's Western Frontier pipeline project, which also closed its open season in July, is also is on schedule, with a FERC filing by the fourth quarter of this year and an in-service target date by November 2003.

"What's driving all of these expansions are the power plant projects," Coombs said. With more than 9,200 MW proposed in the region in the coming years, he said capacity would rise more than 2 Bcf/d by 2010. Noting that every planned expansion might not come to fruition because of competing proposals, Coombs said that there is "still tremendous growth" in the Rockies.

Shelley Wright, supervisor of capacity marketing for Questar Pipeline Co., detailed the many projects her company has under way in the Rockies, including its Main Line 104, the Clay Basin Projects, the Southern Trails pipe to California and its work on the Eakin compressors.

The Main Line 104, a joint venture with El Paso's CIG, will move new and existing gas supplies to the Wasatch Front and other connecting pipes. It is expected to be in service in November 2001, and is on schedule and moving forward, Wright said. She also noted that the Clay Basin, which is the largest storage facility in the western United States, was already ahead of schedule for 2001-2002 storage.

"We're seeing more interest in getting storage filled this year" than last, Wright said, noting that storage was depleted last winter. The Clay Basin facility will undergo testing tentatively in April 2002, which "may result in additional firm capacity." Wright said there had been "a lot of interest in additional storage capacity," and Questar will know more next year as to whether it will expand the facility.

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