Williams and Dominion are partnering to develop the Keystone Connector pipeline, designed to carry up to 1 Bcf/d from the Rockies Express Pipeline (REX) terminus in Ohio to eastern and Mid-Atlantic markets. Under the proposal, the sponsors want to place the 240-mile pipeline into service by 2013. The proposed pipeline would extend from Clarington, OH, to Williams’ Transcontinental Gas Pipe Line (Transco) Station 195 in southeastern Pennsylvania. Williams and Dominion would work with potential shippers to determine the level of interest in the proposal. Williams, through its Rockies Connector project, and Dominion, through its original Keystone project, said they had worked independently over the past two years on various proposals to the Northeast markets with Rockies and growing Marcellus Shale gas supplies. After holding open seasons in 2007, Williams last year decided to combine its Rockies Connector and Northeast Connector projects into the Northeast Supply Project to move gas from Clarington to various delivery points in Transco’s Zone 6 (see NGI, May 12, 2008). Meanwhile, an open season for Dominion’s original Keystone pipeline was launched last year to transport up to 1 Bcf/d from southwestern Pennsylvania, the heart of the Marcellus Shale, to East Coast markets (see NGI, July 7, 2008). The pipeline was to carry gas to Chester County, PA, for delivery to eastern markets through pipes operated by Dominion, Spectra, Williams and NiSource. For information contact Transco’s Jim Moore at (713) 215-3081 or Dominion’s Jeff Keister at (804) 771-4459.
A breakthrough borehole imaging system may push the limits of “seismic-while-drilling” technology to enable producers to more easily find natural gas and oil reserves, the Department of Energy (DOE) reported. The system, developed by Technology International Inc., provides more accurate geo-steering, which could facilitate field development and improve well economics, according to DOE. “The seismic-while-drilling technique uses a downhole acoustic source and receivers at the surface to create real-time images,” which allow an operator to “see” what’s ahead of the drillbit, DOE said. The DOE said no drilling system now available has the “full capabilities” of the new system. Field testing was performed at the University of Texas Devine seismic test site southwest of San Antonio, and at the DOE’s Rocky Mountain Oilfield Testing Center near Casper, WY. Technology International, which provides engineering and regulatory compliance services, is headquartered in the United Kingdom with offices in Richmond, VA.
EXCO Resources Inc. closed its transactions with BG Group plc for the joint development and operation of EXCO’s Haynesville Shale and other related natural gas assets in East Texas/North Louisiana and the joint development and operation of EXCO’s midstream assets in the same area. The transaction gives UK-based BG a 50% interest in 120,000 net acres in East Texas and northwestern Louisiana, and a stake in EXCO’s midstream operations. Around 65,000 net acres are in East Texas; 55,000 net acres are in Louisiana. BG would add an estimated 2.6 Tcf to its resources and gain current net output estimated at 78 MMcf/d (see NGI, July 6). Cash proceeds to EXCO of $996.2 million are being applied to repay EXCO Operating Co. LP‘s $300 million senior unsecured term loan with the remainder applied to the outstanding balances under EXCO’s credit facilities. EXCO also has recently closed the sale to an affiliate of Encore Acquisition Co. of its Norge Marchand Unit in Grady County, OK, other selected Oklahoma, Kansas and Texas Panhandle assets, and its Gladewater Field and Overton Field assets in Gregg, Upshur and Smith counties, TX, for $356.1 million in cash, which was received at closing. The effective sale date was April 1, 2009 (see NGI, July 6).
Drilling has slowed in the Uinta Basin in Utah, but with takeaway capacity still needed, Wyoming Interstate Co. Ltd.’s (WIC) has applied to the Federal Energy Regulatory Commission to expand compression on the Kanda Lateral. El Paso’s WIC pipeline proposes to install a compressor station — the Diamond Mountain Compressor Station in Uintah County, UT, at a cost of around $48.6 million. The station would include two compressor units with a total nameplate of 20,604 hp, which would create up to 180,000 Dth/d of additional capacity on the Kanda Lateral [CP09-449]. The 124-mile, 24-inch diameter lateral currently transports 400,000 Dth/d from near the Natural Buttes Field in Uintah County to an interconnect with WIC’s mainline in Sweetwater County, WY. Bill Barrett Corp. signed a precedent agreement for a maximum delivery quantity (MDQ) of 65 MDth/d of the expansion project’s capacity for a term of 10 years, and Anadarko Energy Services Co. also committed for 10 years at a MDQ of 115 MDth/d. WIC requested approval by March 15 to begin construction in April. The facilities could be in service by Oct. 31, 2010. The pipeline also asked FERC for a predetermination to roll in the costs of the compression expansion in its next Section 4 rate proceeding.
The North Baja Pipeline LLC has an additional year to complete and place in service a lateral extending from a proposed interconnection at the U.S.-Mexico border near Yuma County, AZ, according to the Federal Energy Regulatory Commission. The lateral, which FERC approved in 2008, was scheduled for completion in September, but North Baja said it would not be able to make the deadline (see NGI, Sept. 8, 2008). FERC granted North Baja an extension until Sept. 2, 2010 to place the lateral in service [CP08-152]. The lateral would provide Arizona Public Service Co. (APS) with access to both regasified liquefied natural gas from Mexico and domestic gas for use at the Yucca Power Plant, as well as for the future power generation needs of APS. The $8.5 million project calls for the construction of 3.27 miles of 12-inch diameter pipeline extending from the international border at the Colorado River to the Yucca Power Plant. The U.S. lateral would lie entirely in Arizona. A 3.14-mile-long segment in Mexico would be constructed by Sempra‘s Gasoducto Bajanorte S. de R.L. de C.V. and would connect with the Gasoducto Bajanorte pipeline north of Algodones, Mexico, to the international border.
Transcontinental Gas Pipe Line Co. (Transco) faces penalties and up to $952,500 in fines following an investigation into a pipeline rupture and fire in September 2008 near Appomattox, VA, the Department of Transportation (DOT) said. On Sept. 14, 2008, inspectors with DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) responded to a Transco gas pipeline rupture and subsequent fire in Appomattox County that resulted in five injuries, the evacuation of 23 families and the destruction of two homes. Dozens of other homes were damaged. Following the incident, PHMSA issued Transco a corrective action order, which imposed restrictions and corrective actions on the failed pipeline segment, as well as on adjacent lines. The order required the company to eliminate risks to public and environmental assets through measures including pressure reductions, internal and external inspections and repairs. In addition to addressing the immediate failure location, the PHMSA order required Transco to focus on other segments of the pipeline to address potential problem areas that could lead to pipeline failures. PHMSA investigators, who recently completed their review of the incident, said they discovered “possible failures” by Transco to address regulatory requirements for monitoring and preventing external corrosion. Installing effective corrosion control methods has proved to be a vital maintenance function necessary to help ensure pipeline integrity, DOT said. Williams Gas Pipelines, which oversees Transco’s business, was given 30 days from the date of the penalty notice and proposed fine to respond.
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