SoCal Seeks OK to Hang 'Closed' Sign at Topock
Southern California Gas (SoCalGas) has called on FERC to put an
end to El Paso Natural Gas' alleged practice of over-booking firm
primary capacity at the SoCalGas/Topock delivery point in
California. The distributor contends its own firm entitlements at
the delivery point have been cut between 25%-57% on a daily basis
because of El Paso's actions, and that it's costing it nearly
$46,000 a day.
In Section 5 complaint filed recently, SoCalGas asked the
Commission to officially rule the SoCalGas/Topock delivery point is
fully subscribed and "unavailable" for sales on a firm primary
basis, and that it also was fully subscribed during the Jan. 1 open
season when El Paso awarded more than 1.2 Bcf/d of capacity on its
system to affiliate, El Paso Merchant Energy, and Williams Energy
Additionally, SoCalGas requested that FERC order El Paso to
"cease and desist" violating existing FERC regulation and precedent
by continuing to sell firm primary capacity into the delivery point
when none is available. And, it wants FERC to order El Paso to
re-schedule the capacity it awarded during the open season last
Jan. 1 or afterwards on a secondary basis into SoCalGas/Topock
Although the Commission has never ruled on whether the
SoCalGas/Topock delivery point is fully subscribed on a firm
primary basis, the California distributor noted that FERC
"expressly held" last April that El Paso could not sell firm
primary capacity into a point that is fully subscribed. But El Paso
continues to flout that ruling, it said.
For example, SoCalGas cited one of El Paso Merchant Energy's
contracts with El Paso for firm primary Block III capacity (387,261
Mcf/d) for delivery to SoCalGas/Topock, and Williams Energy
Marketing's contract for 99,309 MMcf/d of El Paso capacity with
primary firm delivery rights into the SoCalGas/Topock delivery
point. Also, it noted El Paso Merchant has entered into a series of
pre-arranged capacity release transactions each for 50,000 Dth/d of
Block III capacity into the SoCalGas/Topock point for a four-month
period (July, 1-Oct. 31, 2000).
This capacity, as well as other capacity awarded by El Paso
during the Jan. 1 open season and afterwards, "was acquired with
the express notice that the capacity would be subject to
prospective changes in El Paso's capacity-allocation procedures,"
SoCalGas said. "Consistent with that notice," it urged FERC to
direct El Paso to re-schedule the capacity on a secondary basis
El Paso's scheduling practices at SoCalGas/Topock, as well as
its contracts with affiliates, have been the target of other
complaints brought by Amoco Production and the California Public
Utilities Commission. While they involved broader issues, SoCalGas
contends the issue raised and remedy sought in its complaint are
more "narrow in scope," and as a result could "aid in the
resolution of [the] other pending related proceedings."
In related action, Southern California Edison has asked FERC to
grant Indicated Shippers' request for "expedited resolution" of
the complaint filed by Amoco Production and Burlington Resources
Oil & Gas more than a year ago. It was the first case to bring
the issue of capacity over-booking at SoCalGas/Topock to the
"It is axiomatic that justice delayed is justice denied. In this
case, justice has been delayed - and denied - long enough," Edison
told FERC [RP00-139]. The California utility urged the Commission
to either order El Paso to adopt "just and reasonable"
capacity-allocation procedures, or "immediately" establish hearing
procedures for parties to litigate the justness and reasonableness
of El Paso's current practices.
SoCalGas also is seeking fast-track processing of its complaint,
saying that "only prompt Commission action can prevent continuing
harm to SoCalGas and similarly situated shippers resulting from El
Paso's proscribed behavior."
SoCalGas estimated the design capacity at SoCalGas/Topock is
539,464 Mcf/d, but it says El Paso by its own admission has
contracted on a primary basis for nearly three times that amount at
the delivery point - 1,466 MMcf/d. This has led to extensive cuts
in the distributor's daily firm entitlements at the delivery point,
SoCalGas said, adding that it was costing it about $46,000 a day or
$17 million annually.