A top-level FERC staffer last week asked El Paso Natural Gas toconsider switching its Line 2000 crude-oil conversion from areplacement project to an expansion of its existing system to easepipeline capacity constraints to the California border.

“I am writing to inquire about the feasibility of modifyingthe…project in a manner which could assist the difficultsituation now confronting the California gas market,” said DanielM. Adamson, director of FERC’s Office of Energy Projects.

In August, El Paso filed an application to acquire an existing30-inch diameter, 1,088-mile crude oil pipeline from Plains AllAmerican Pipeline L.P., and convert part of it to natural gastransportation. The line extends from McCamey, TX, to Bakersfield,CA. El Paso seeks to convert the 785-mile segment from McCamey toEhrenberg, AZ, to gas. El Paso proposed the Line 2000 project as aloop line to replace existing compression, and not as a systemexpansion.

“It appears that if El Paso kept the six…compressor stationson the line and implemented any necessary facility additions andmodifications to integrate the converted line with its existingSouth System, it may be possible for El Paso to increase itsdelivery capacity into California,” Adamson said.

He asked El Paso to consider this option, given “the currentdifficult energy situation there [in California] and the consequentneed to examine all possible options for substantive relief” of thesituation. “I am interested in your thoughts on this matter,including the feasibility of such an expansion, the magnitude offacilities and costs which might be involved, who would bear thosecosts, and possible procedural approaches.”

If this “is not a viable option, please indicate whether El Pasois considering other options for system expansion which wouldenhance gas transmission capacity into California,” Adamson wrote.

Susan Parker

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