To take advantage of the burgeoning natural gas volumes flowing from Colorado, El Paso Pipeline Partners LP plans to expand its Wyoming Interstate Co. (WIC) Piceance Basin lateral pipe, and additional capacity may be available by late next year.
WIC’s existing 24-inch, 142-mile Piceance Basin lateral delivers natural gas to the WIC Mainline and to Colorado Interstate Gas at Wamsutter and then to points at Kanda and Opal in Cheyenne, WY, via WIC’s Mainline.
“This expansion project comes at a critical time for Rockies producers to move additional natural gas supplies to consuming regions by 2008 and beyond,” said El Paso Pipeline Partners CEO Jim Yardley. “The Piceance expansion further illustrates the important need for additional long-haul export capacity, such as the Ruby Pipeline Project separately announced by El Paso Corp., to serve constrained Rocky Mountain natural gas supplies.”
El Paso and joint partner Bear Energy LP earlier this month filed a right-of-way application with the Bureau of Land Management for Ruby, a 680-mile, 42-inch diameter pipeline that would begin at the Opal Hub in Wyoming and terminate at the Malin, OR, interconnect near California’s northern border (see Daily GPI, Dec. 4).
The $62 million Piceance project would provide 230,000 Dth/d of new capacity with the installation of an additional 25,300 horsepower of compression at the WIC Greasewood Compressor Station in western Colorado and at a new Midpoint Compressor Station in northwestern Colorado. If El Paso obtains the required regulatory approval, it said that initially, 50,000 Dth/d of new capacity would be in service by 4Q2008, with the remainder of new capacity available a year later.
An open season for additional capacity from the Piceance Basin closed on Nov. 20, and El Paso said it was fully subscribed.
The existing Piceance Basin lateral already was fully contracted, with a capacity of 350,000 Dth/d. Shippers in the binding open season that closed last month subscribed to an additional 230,000 Dth/d, which would bring the lateral’s total capacity to 580,000 Dth/d once the expansion is complete. The successful bidders in the open season elected to deliver their natural gas at Opal and also committed to WIC mainline capacity.
The Piceance Lateral Expansion Project would be funded using El Paso’s revolving credit facilities. The company estimated the project would increase cash available for distribution by $4 million in 2010 and $12 million in 2011.
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