Mississippi Canyon Gas Pipeline won blessing in a draft orderfrom the FERC for firm capacity expansion from 600 MMcf/d to 800MMcf/d. Mississippi Canyon – formerly Shell Gas Pipeline -operates a 45-mile dual-phase line from the West Delta Block 143″A” platform on the Outer Continental Shelf offshore Louisiana toterminus near the Venice Gas Plant in Plaquemines Parish onshore inLouisiana. The capacity increase is to come from establishingmaximum receipt and delivery point pressures and installation ofadditional metering facilities on the pipeline’s existing system atthe Venice plant delivery point.
Mississippi Canyon also was granted a predetermination forrolled-in rates as the Commission found system-wide benefits to bederived from the expansion. In approving the expansion the FederalEnergy Regulatory Commission denied protests of Conoco and Exxonand exempted the expansion from its contract policy.
“Mississippi Canyon’s proposal does not include long-termcontracts for a significant percentage of firm capacity of theproposed facilities. However, the Commission has recognized that itis in the public interest to encourage the timely and orderlydevelopment of an interstate pipeline infrastructure to support isplanned development and production activities in the Gulf ofMexico.”
Exxon had questioned the need for the expansion facilities andthe rate impact of the expansion. Conoco questioned rate impact andrequested Mississippi Canyon be required to file a Section 4 ratecase or that the Commission initiate a Section 5 investigation intorates. All of these were denied by the FERC. BP Exploration &Oil filed to intervene and protest the application but subsequentlywithdrew its protest.
Mississippi Canyon said the expansion is needed to servedeep-water gas fields producing or under development in theMississippi Canyon area in the deep-water regions of the Gulf. Thesystem has direct interconnections via the tailgate of the Veniceplant with Koch Gateway, Southern Natural Gas, Texas EasternTransmission, and Columbia Gulf Transmission. Five deep-waterfields – Mars, Mensa, Ursa, Europa, and King – are or will besupplying Mississippi Canyon. Mars, Mensa, and Ursa are committedfor the life of the least to Mississippi Canyon by existing reservecommitment agreements. Mississippi Canyon told the FERC it expectsall of the production from the Europa and King fields will becommitted by reserve commitment agreements.
Mars currently produces about 140 MMcf/d in addition to oilproduction. Mensa has a sustained flow of 260 to 280 MMcf/d. Ursais scheduled to begin production by mid-year with rates ramping upover a three- to four-year period to a peak of 350 to 450 MMcf/d.Europa and King production will be processed on the Mars tensionleg platform. Europa is expected to begin producing next year witha peak rate of 60 MMcf/d. King is scheduled to come on line in 2001with a peak rate of 6 MMcf/d
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