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REX-Entrega Cleared for Service Between Wamsutter, Cheyenne Hub

FERC Friday approved Rockies Express Pipeline LLC's (REX) request to begin service on the second segment of the Entrega Pipeline project between Wamsutter, WY, and the Cheyenne Hub in Colorado.

The authorization came only weeks after the Federal Energy Regulatory Commission admonished Rockies Express for its "poor compliance record" during the construction of the second segment of the Entrega project, and signaled at the time that it might issue a "stop work order" for the line (see Daily GPI, Jan. 25). The Entrega pipeline project, referred to as Rockies Express-Entrega, will be the western end of the proposed 1,663-mile Rockies Express pipeline when completed.

For the period of Jan. 10-15, the joint FERC/Bureau of Land Management cited the Rockies Express pipeline several times for carrying out unapproved activities outside the limits of the certificated construction work areas. Despite teleconferences with the company and on-site meetings with REX management, the agency said its attempts to put a halt to the noncompliances by Rockies Express had been unsuccessful. It ordered Rockies Express, which is a joint project of Kinder Morgan Inc., Sempra Pipelines & Storage and ConocoPhillips, to outline what actions it intended to take to stop the noncompliances.

Despite the series of citations in January, J. Mark Robinson, director of FERC's Office of Energy Projects, said he authorized service on the second segment of Rockies Express-Entrega based on a number of factors: "a) REX's response to my letter and implementation of [certain] enhancements; b) my staff's field inspection of Segment 2 construction activities; c) recent reports [from] our joint FERC/Bureau of Land Management environmental compliance monitors, which confirm that REX has adequately stabilized the right-of-way with sufficient erosion control devices; and d) REX's commitment to conduct winter monitoring and remediation activities, as needed, in the interim in accordance with REX's winter construction plan."

However, "I remind you that the National Pollution Discharge Elimination System permit issued for this project by the Wyoming Department of Environmental Quality requires that during seasonal shutdowns, qualified personnel inspect inactive construction sites at least once every month. I expect REX's environmental inspector to rigorously implement this permit requirement and to file monthly status reports with FERC," and to "implement final cleanup, stabilization and seeding activities on all remaining lands disturbed by construction of the Segment 2 facilities," Robinson said in his letter to Kinder Morgan.

He also directed Rockies Express to "identify in a separate reply to this letter what penalties REX had in its contract with the contractors for failure to implement the mitigation measures in the Commission's certificate."

The second segment includes 192 miles of 42-inch diameter pipeline that would extend the Rockies Express-Entrega system from Wamsutter through Carbon, Albany and Laramie Counties, WY, and Larimer County, CO, to the Cheyenne Hub, where it would interconnect with multiple downstream pipelines, including the proposed Rockies Express Pipeline [CP04-413].

The first segment -- a 136-mile, 36-inch diameter pipeline that extends from Meeker Hub in Rio Blanco County, CO, to Wamsutter in Sweetwater County, WY -- has been completed and went into service a year ago. That portion of the line added 750 MMcf/d of firm capacity to the region, significantly boosting gas deliveries out of the Piceance Basin.

In addition to the Entrega part of the project, the Rockies Express line will consist of a 713-mile REX-West segment extending from the Cheyenne Hub to Audrain County, MO, and a REX-East portion that would run from Audrain County to Clarington, OH. Kinder Morgan will operate the entire Rockies Express system, which would carry as much as 2 Bcf/d to Midwest and Northeast markets.

When completed, the $4 billion pipeline would be the largest constructed in the United States in 20 years. Assuming all regulatory approvals and additional shipper commitments are received, most of the Rockies Express project is expected to be in service in mid-2009, according to Kinder Morgan.

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