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Rockies Express Open Seasons Draw 1.3 Bcf/d in Binding Commitments

Kinder Morgan Energy Partners LP (KMP) and Sempra Pipelines & Storage said Tuesday they received 1.3 Bcf/d in binding, conforming commitments for two separate open seasons for the proposed Rockies Express Pipeline project (see Daily GPI, Nov. 10). The partners said they will make a final decision on the proposed west-to-east pipeline in February.

Under the terms of the open seasons, shippers will have until Jan. 31 to receive approval from their respective boards of directors. In the meantime, the two companies' project team will continue to work with shippers that submitted nonconforming bids and communicate with other parties that had expressed interest but did not submit a bid.

"As a result of the strong showing in the open seasons, we are confident that we will reach our target of 1.5 Bcf/d by February 2006 and move forward with the project," said Scott Parker, president of KMP's Natural Gas Pipelines group. "The commitments we received from shippers clearly indicate they recognize the value of adding new infrastructure to link growing production areas in the Rockies to consuming regions in the Midwest and Northeast and are willing to step up and make it happen."

The binding open seasons were held concurrently from Nov. 9 to Dec. 19 to gauge shipper support for capacity on the Rockies Express pipe and to obtain commitments for an extension of the KMP-operated Entrega Pipeline, as well as a potential expansion of Entrega's currently certificated facilities (see Daily GPI, Oct. 19). The Entrega pipe is being built by a subsidiary of EnCana Corp.

El Paso Corp.'s competing Continental Connector pipeline project, which would connect the company's Rocky Mountain region pipes with its three eastern U.S. lines, received preliminary expressions of interest for about 3 Bcf/d of capacity from its recent open season (see Daily GPI, Dec. 1). The 1-2 Bcf/d Continental Connector would not only tap Rockies production, but also output in the Midcontinent and Texas, eventually terminating in northern Mississippi.

For information on the Rockies Express open seasons, contact KMP's Jeff Rawls at (303) 914-4903 or Sempra's Ryan O'Neal at (619) 696-4585.

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