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Carolinas Demand Draws Proposals for Two New Pipes, One Expansion

Carolinas Demand Draws Proposals for Two New Pipes, One Expansion

The Carolinas are calling out for gas and so far three parties have answered.

First came the Palmetto Pipeline project, a joint venture of Carolina Power &amp Light (CP&ampL) and Sonat. Next came Scana's South Carolina Pipeline Corp. with a Carolinas proposal. And last but not least is Williams-Transco with a proposed expansion called Sundance.

Williams last week announced an open season through June 1 for annual firm service to be created by Transco's Sundance. The expansion would serve growing Southeast power generation, residential and commercial markets and be in service by April 2002. Sundance would expand the Transco system from Station 65 in Louisiana to Station 165 in Virginia.

Williams said Sonat's Sundance expansion is positioned to serve CP&ampL's recently announced gas-fired power plants, as well as facilities providing gas to eastern North Carolina. Williams recently said it wants to work with the Albermarle Regional Energy Authority (AREA) to serve several counties in eastern North Carolina that have not previously had gas service (see NGI April 12, 1999). Williams has proposed to jointly develop with AREA transmission and distribution facilities to serve North Carolina counties Camden, Currituck, Chowan, Pasquotank, and Perquimans. Williams plans to apply for a portion of $200 million in bond funds North Carolina is making available to foster gas infrastructure development.

"We believe that the Sundance Project will provide a more cost-effective and reliable means of serving the growing power generation markets in Alabama, Georgia, the Carolinas and southern Virginia than any proposed greenfield pipeline project," said Cuba Wadlington Jr., general manager Williams Gas Pipeline-Transco. "Also, we expect this project will create opportunities to expand local infrastructure, including the Cardinal Pipeline in North Carolina and local distribution systems along the Transco system, in order to optimize the utilization of these facilities. This will ultimately benefit both electric and natural gas consumers resulting in lower costs and encouraging economic development with minimal impact to the environment."

Shippers may elect to subscribe to capacity from Station 65 in Transco's Zone 3 or certain receipt points in Zone 4. Transco said it intends to seek rolled-in rate treatment for project costs.

Meanwhile, Scana subsidiary South Carolina Pipeline Corp. announced plans last week to build an extension off of its existing 1,900-mile intrastate line into North Carolina. The existing line currently supplies gas to customers throughout much of South Carolina and has direct connections with both the Transco and Sonat systems.

The Palmetto Pipeline, with an open season running through May 31, is the one that started it all. The project has the backing of CP&ampL, which plans to subscribe for a substantial portion of the 200 to 300 MMcf/d of proposed capacity. Sonat plans to expand its system to accommodate Palmetto's growth in the form of additional looping and compression.

Sonat spokesman Bruce Connery said the challenge from Scana and Sundance was not unexpected. "It comes as no surprise. It's what we fully expected to see. Obviously, these companies view the Palmetto pipeline as a competitive threat, but we still believe our project is competitive and the market will be able to evaluate its options."

The word last week from South Carolina Pipeline President Berry Gibbes was "Our interstate pipeline project is a superior alternative to the proposed Palmetto Pipeline.. We recommend that any gas shipper who may be considering subscribing to firm capacity on the proposed Palmetto Pipeline Project wait to compare our alternative interstate pipeline before being locked into a more costly service for up to 20 years."

Williams spokeswoman Amy Kiser touted Sundance's Virginia connection as providing additional support for its project. Tying in with CP&ampL's power plants is not critical to the project's success, she said. "We're the most economic alternative."

Joe Fisher, Houston

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