Calypso U.S. Pipeline LLC, a subsidiary of SUEZ Energy North America Inc., has asked FERC to reconsider a January order that denied Calypso's request to begin construction of the U.S leg of an offshore Florida pipeline before an affiliate has received regulatory approval to build an associated liquefied natural gas (LNG) terminal in the Bahamas and a connecting Bahamian pipeline. Calypso is seeking rehearing so that it can interconnect with affiliate Calypso LNG LLC's proposed deepwater LNG port.

The original project called for a SUEZ Energy affiliate to construct a new LNG terminal in Freeport, Grand Bahama and a connecting Bahamian pipeline, which would tie in with the FERC-approved Calypso U.S. line at the exclusive economic zone (EEZ) international boundary (see Daily GPI, July 30, 2001). The original project sponsor was Enron Global LNG. SUEZ Energy (then Tractabel) bought the project in 2002.

But the Bahamian regulatory officials have dragged their feet on their half of the project, frustrating the construction plans for the Calypso U.S. Pipeline. In the meantime, Houston-based SUEZ Energy has moved ahead with the development of a deepwater port 10 miles off the southeastern coast of Florida, which would serve as an offshore delivery point for LNG transported by tankers.

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Last May, Calypso said it might add a new receipt point to its proposed connecting line about 10 miles off the coast of Florida to accept deliveries from the proposed deepwater port. It asked for FERC authorization to begin construction of its 42-mile offshore pipeline upon the earlier of its affiliate receiving Bahamian approval or the authority to build the deepwater port. FERC, in a March 2004 order approving the Calypso line, expressly said Calypso could not begin construction of the U.S. leg until Bahamian regulators had approved the LNG terminal and connecting pipeline.

FERC in a Jan. 25 order denied Calypso's request, observing that "Calypso has not yet filed an application for authorization to construct pipeline facilities to interconnect with this deepwater LNG port."

In a request for rehearing filed Friday, Calypso U.S. Pipeline noted the Commission's statement that "Calypso has not filed a necessary request for authorization to construct the laterals and interconnecting facilities -- which is the factual premise upon which its conclusion is based -- is in error. There are no Calypso facilities associated with the two potential deepwater port receipt points for Calypso to construct and so no request for authorization by Calypso is needed."

Calypso pipeline "would simply use an inline wye in lieu of a pipe spool segment at each of the deepwater port receipt points. The laterals from the proposed deepwater port to the receipt points on the Calypso U.S. Pipeline are part of the deepwater port application filed by Calypso's affiliate Calypso LNG LLC," the company said.

In the January order, the Commission granted Calypso's request to defer the in-service date of the pipeline to June 30, 2010, as well as to increase the diameter of the 42-mile pipeline located in U.S. waters to 30 inches from 24 inches. The change would not affect the certificate capacity of the proposed pipeline (832,000 MMBtu/d), Calypso said.

If the Bahamian LNG project is ever approved and built, the Calypso pipeline would transport gas to a connection with Florida Gas Transmission (FGT) in central Broward County from a connecting Bahamian pipeline at the EEZ international boundary. The line would make landfall at Port Everglades, then travel onshore to a proposed interconnection with FGT adjacent to Florida Power & Light's Fort Lauderdale power plant.

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