With its sights on a growing southeastern market, Columbia Gulf Transmission, a unit of the NiSource Gas Transmission & Storage system, announced it has reconfigured its key compressor station at Rayne, LA to flow south and East as well as north, at the same time Florida utilities are scrambling to replace plans for new coal generation plants with natural gas-fired power.

Columbia’s announcement that it can now divert as much as a Bcf/d from the trip north coincided with comments from FPL executives Monday that they are “actively engaged in discussions and negotiations” for new natural gas capacity to serve their Florida territory. Florida utilities’ plans for added coal-powered generation facilities have very rapidly lost ground with the increasing clean fuels campaign in the state.

During an earnings conference call, the FPL executives said that if it was not going to be possible to add significant solid fuel generation within Florida, “we are going to need to see some expansion of the natural gas infrastructure, not just transportation, but storage as well. One of our biggest concerns is the physical reliability,” they said, noting the supply disruptions caused by hurricanes in the Gulf of Mexico two years ago. “We have some work to do to ensure sufficient inventory and flex capacity to maintain physical reliability.”

That dovetails with Columbia Gulf’s new directions. While Columbia Gulf has traditionally taken much of its supply from on- and offshore in the Gulf, pipeline officials now are pointing to connections with the Perryville Hub, tapping natural gas supplies from the Barnett Shale, Carthage, the Bossier Sands, and eventually supplies sourced from the Midcontinent, the Fayette Shale and Gulf Coast LNG terminals.

“This is a new era for Columbia Gulf Transmission,” said Christopher A. Helms, president of NiSource Gas Transmission & Storage. “The newly configured Rayne station provides the critical link between expanding supplies accessing Columbia Gulf from the Perryville hub north of Rayne, and growing markets in both the Northeast and the Southeast.”

Located at the juncture of Columbia Gulf’s South Louisiana lateral lines and its Mainline system, the Rayne Compressor Station near Lafayette has historically moved up to 2.1 Bcf per day of natural gas from onshore and offshore producing areas northward to markets served by it and its sister company,Columbia Gas Transmission Corp.

With the new bidirectional flow configuration Columbia Gulf will now be able to flow up to 1 Bcf/d south and east from its mainline through its East Lateral pipeline system, which connects with multiple pipelines serving growing Southeast and other markets, including Florida Gas Transmission, Transcontinental Gas Pipe Line, Gulf South Pipeline, Southern Natural Gas, the Henry Hub and the Louisiana intrastate pipeline grid.

The reconfiguration also paves the way for future expansion of services on Columbia Gulf’s system, the first of which will be the new Evangeline and Terrebone interconnections with Transco scheduled to be in service beginning Nov. 1, 2007.

Potential shippers should contact one of the following Columbia Gulf Transmission representatives: John McNamara at (713) 267-4737, Pete Brastrom at (713) 267-4735 or Beth Medlin at (713) 267-4756.

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