Duke Energy Gas Transmission told shippers on the former southern Westcoast mainline in British Columbia that it has deferred construction of its proposed expansion project in an effort to minimize costs and because some unexpected capacity became available.

In a notice sent out Monday, DEGT said the majority of the proposed 200 MMcf/d of capacity on the proposed Southern Mainline expansion project, which was approved by the National Energy Board in January, has become available through turned back capacity. As a result, the cost of the project will be reduced by C$220 million to C$50 million. Construction of the remaining facilities is being deferred.

“We were able to reduce the size of the proposed expansion, in most part through utilization of existing Southern Mainline capacity that has become available in our annual contract renewal process,” the company told shippers.

“Recent market indicators have shown that, in the near term, we can accommodate the firm service transportation needs of our expansion customers through a combination of transportation capacity of 135 MMcf/d that will become available effective Nov. 1 on the Southern Mainline through our annual capacity renewal process, less turned back capacity that will be recontracted, and [through] new transportation capacity [that] will be provided through the addition of compression at Compressor Station 8B – located near Hope, BC.”

With the reduced project scope, construction is scheduled to start at Compressor Station 8B in mid-April 2003 with completion targeted for Nov. 1. Additional secondary work will include construction of additional metering facilities at Huntingdon and the installation of new compressor wheels at Compressor Station 9.

DEGT said despite the reduction it is confident in market growth prospects in British Columbia and the U.S. Pacific Northwest. It also is confident in the growth of gas supply in northeastern British Columbia. However, the company plans to work with customers to determine the exact timing for the balance of the proposed expansion facilities.

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