Noting that the publication of its Gas Quality Policy Statement (PL04-03) “was not a pretext for pipelines to completely revamp the gas quality and interchangeability standards in their tariffs,” FERC recently rejected an attempt by Northern Natural Gas to make major changes in its quality standards specifications and in the manner those standards are applied or waived.

Northern Natural provoked a firestorm of protest after its May 1 proposal to set new gas quality specifications for oxygen, carbon dioxide, heating value, gas temperature, cricondentherm hydrocarbon dew point (CHDP) Butanes and heavier hydrocarbons, total inerts, the Wobbe Index and hazardous substances. The pipeline also proposed including tariff provisions allowing it to waive the quality specs when it believed it was necessary to avoid negative impacts on its facilities.

Producers, shippers and customers protested the new standards and the uncertainty regarding their applicability, saying they would substantially curtail the supply of gas that could flow through the Northern Natural system. For instance, Virginia Power Energy Marketing Inc. said it would create a barrier between eastern and midwestern markets and the new gas supplies from the Rockies that would enter Northern’s system through market area receipt points.

Following a technical conference the Federal Energy Regulatory Commission issued an order [RP07-425] earlier this month, rejecting one-by-one Northern’s proposed specification changes, saying in most cases that the pipeline had failed to show how the existing standards had already or could in the future adversely affect its operations.

“The Commission’s Policy Statement does not mandate use of the Interchangeability White Paper Interim Guidelines [see Daily GPI, June 16, 2006]. Rather, the Commission strongly encourages pipelines and their customers to use [the guidelines] as a common scientific reference point for resolving gas quality and interchangeability issues,” FERC said. Refusing to change the heavier hydrocarbons standard as requested by Northern Natural, FERC said the pipeline “failed to identify any past, current or future problems with butanes and heavier hydrocarbons” on its system.

©Copyright 2007Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.