In its new two-part capacity allocation proposal filed at FERC lastweek (See Daily GPI, Feb. 11) El Pasoestimates it will be able to assign “pathed” or very firm rights to3,590 MMcf/d out of the 5,100 MMcf/d of contract demand and billingdeterminants applicable to its firm transportation agreements.

With “pathed” rights, firm shippers would create specificreceipt-and-delivery point combinations. These “pathed” rightswould give shippers a “high degree of assurance that thosetransactions…would not normally be curtailed due to the marketdecisions of other shippers,” said Bill Healy, vice president ofoperations control and pipeline planning. Under “non-pathed” orlesser firm rights, shippers would continue with the existingpractice of selecting a specific delivery point, but not a receiptpoint. These shippers still would be vulnerable to curtailments.

“What we’re trying to do is take El Paso’s system and give theshippers something that looks more like what they view as normalfirm on other pipelines, where you have a receipt point, aparticular path…..on which you retail capacity and a particulardelivery point,” Healy told NGI.

“There would be a limited quantity of pathed rights assigned tothe SoCal-Topock point…..The pathed rights total less thanSoCal’s take-away capacity, and you’d have a high degree ofassurance on getting that pathed gas in there. Then the currentcompetition for market share, which is really what this is allabout, would continue to go on using the non-pathed rights,” Healysaid.

Dividing the baby into two classes of service “strikes a middleground between the [pro-rata method] in use today and a rigorouslypathed approach,” El Paso told the Commission. It said the proposalwas “an acceptable way to revise its capacity-allocationprocedures, if a revision to those procedures is actuallynecessary, appropriate and desired by El Paso shippers.” Theproposal was in response to numerous complaints about lack ofaccess to the SoCal-Topock point and a FERC order to remedy thesituation by regularizing its system.

Currently the pipeline permits shippers cart blanche access toreceipt points, up to the maximum limit of their contracts. “ThisCommission apparently intends for El Paso to limit this flexibilityby designating specific receipt point rights which each shippermust use to deliver gas into the system on a primary basis,” ElPaso said in its proposal.

“If El Paso attempted to assign pathed rights based on thecombination of 144 receipt points and 296 delivery points, therewould be at least 42,624 paths that El Paso would have to createthrough its system and that shippers would have to specify in theirdaily nominations,” the pipeline said in defending its proposedtwo-part system. To avoid this, El Paso proposes to use sevenpooling areas as receipt points — Anadarko, Blanco, BondadStation, Bondad Mainline, Keystone, Plains and Waha. assign primaryreceipt points to its customers.

To address El Paso’s contracting problems at the Californiaborder, the pipeline proposes to treat the four interconnects atTopock — SoCal, PG&E, Mojave and Southwest Gas — asindividual delivery points for pathing purposes.

By segments, the breakdown of “pathed” rights would be: 450MMcf/d for shippers on the Plains-to-Eunice Transfer Lines; 625MMcf/d on the Bondad-to-Blanco Line; 68 MMcf/d out of the AnadarkoBasin; 1,990 MMcf/d out of the San Juan Basin; 1,550 MMcf/d out ofthe Permian Basin; about 60 MMcf/d on the East End; about 418MMcf/d at El Paso’s interconnect with SoCalGas at Topock, AZ; about883 MMcf/d at El Paso’s interconnect with Pacific Gas and Electric(PG&E) at Topock; about 331 MMcf/d at El Paso’s interconnectwith Mojave Pipeline at Topock; and a maximum of 35 MMcf/d at ElPaso’s interconnect with Southwest Gas at Topock.

In an appendix El Paso designates for each firm customer theamount of capacity that will be “pathed,” as well as the pathedrights for unsubscribed capacity. The total amount of pathed rightsassigned to all El Paso shippers would be based on the “physicalforward-haul transportation capability of the El Paso system undernormal, not optimal, operating conditions.” Any additional capacitycreated by backhaul or other displacement transportation would notbe considered part of the capacity used to serve “pathed” shippers.

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