National Fuel Gas Distribution Corp. and the Pennsylvania Public Utility Commission (PUC) have reached a settlement agreement in the Aug. 21, 2004 gas explosion in Sandy Township, PA, that destroyed a home and left two residents dead. The settlement agreement ends an informal investigation into the gas explosion, which resulted from a leak in a gas line, the PUC said. Under terms of the settlement, National Fuel agreed to pay a $50,000 fine, fund an additional $30,000 of safety-related activities for its system and committed to undertake system improvements costing more than $1.8 million. National Fuel agreed to modify its operating procedures and accelerate an ongoing plastic pipe leakage survey of its Pennsylvania system. The company has also retrained and tested its plastic fusion work crew members. The PUC has given interested parties 20 days to comment on the settlement agreement and will issue a final determination on the settlement at an upcoming public meeting. National Fuel serves about 210,000 natural gas customers in 14 Pennsylvania counties.

A Korean-Japanese consortium of three companies has secured a contract with the Mexican government’s electricity commission to build and operate a 1 Bcf/d liquefied natural gas (LNG) receiving terminal along the western mainline coast at Manzanillo. Mitsui & Co. Ltd. (37.5%), Samsung Engineering & Construction (37.5%) and Korea Gas Corp. (25%) secured the 20-year contract for the $900 million project. Mitsui said the consortium will form a jointly owned company to build and operate the terminal, from which gas is slated to power a number of existing and proposed electric generation plants in the greater Guadalajara area. Mexico’s Comision Federal de Electricidad (CFE) will purchase the regasified LNG. Under a 20-year deal with CFE, the consortium’s company will manage the LNG receipt and regasification with commercial operations beginning in 2011. In February CFE extended the time for obtaining bids from companies wanting to build the Manzanillo LNG terminal.

The South Peace Pipeline Project, a proposed 57-mile extension of Westcoast Energy Inc.’s existing raw gas gathering system near Fort St. John, BC, will be the subject of an oral hearing on Aug. 26, Canada’s National Energy Board (NEB) said. The 20-inch diameter pipeline would carry unprocessed sour natural gas from the South Peace area, south of Fort St. John and the Peace River, to Westcoast’s existing McMahon processing plant, in Taylor, BC, where the pipeline would tie-in to an existing pipeline, the Peace River Crossing Pipeline, constructed in 2007. The Peace River Crossing Pipeline is an approximately seven-mile long, 12.75-inch diameter pipeline that extends under the Peace River and currently ties-in to the Westcoast Milligan Peejay Pipeline. The project also includes plans for an approximately 1.3-mile, 20-inch diameter pipeline, beginning at the Peace River Crossing Pipeline on the north side of the Peace River and ending at the McMahon Plant, and a parallel 20-inch diameter pipeline to provide capability for liquids handling. Westcoast, carrying on business as Spectra Energy Transmission, has estimated the value of the proposal to be C$95 million. Pending regulatory approval, construction is anticipated to begin next winter with completion by July 2009. The NEB said the location of the hearing will be determined based on public interest expressed and suitability for a public hearing. The NEB approved the roll-in of Westcoast Transmission Co. (Alberta) Ltd. into Spectra Energy Transmission West’s Pipeline Divisions T-North Service in November.

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