FERC Wednesday issued a favorable environmental review of Panhandle Eastern Pipeline Co. LP's proposal to replace existing pipeline with larger diameter pipe to restore long-haul deliveries from Tuscola, IL, eastward to Michigan.

"Approval of the proposed project, with appropriate mitigating measures, would not constitute a major federal action significantly affecting the quality of the human environment," agency staff said in the environmental assessment of the proposed Tuscola East Replacement Project [CP06-428].

Panhandle Eastern proposes to replace approximately 31 miles of pipeline consisting of three segments in Illinois and Indiana. Specifically, it plans to replace 6.7 miles of the existing 20-inch diameter Tuscola 100-Line in Douglas County, IL, with 36-inch diameter pipeline, designating the new pipeline as the 500-Line; replace 1.9 miles of the existing 36-inch diameter Tuscola 200-Line with 20-inch diameter pipeline; replace 6.6 miles of the existing 20-inch diameter Montezuma 100-Line in Parke County, IN, with a 36-inch diameter line, designating the new pipe as the 500-Line; and replace 17.9 miles of the existing 24-inch diameter Zionsville 200-Line in Indiana with 30-inch diameter pipe, designating the new line as the 500-Line.

As a result of the age of Panhandle Eastern's existing line and stricter Department of Transportation regulations, Panhandle was forced to reduce the operating pressure on one line to 20% in 2004, which significantly affected deliveries in the Midwest. The pipeline, which is owned by Houston-based Southern Union, is now seeking to upgrade transportation capacity in the region.

Panhandle Eastern has asked the Federal Energy Regulatory Commission to issue a certificate for the project by April so that it can begin construction in June. The estimated cost of the project is $55.8 million.

Panhandle Eastern operates a 6,500-mile pipeline that delivers 2.8 Bcf/d of natural gas to Midwest and East Coast markets.

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