Looking to better serve the needs of consumers in the greater Chicago area, Kinder Morgan Inc. (KMI) announced Wednesday that it has entered into a long-term, firm transportation agreement with The Peoples Gas Light and Coke Co., an affiliate of Peoples Energy, that will support construction of a new $13 million natural gas pipeline. Pending regulatory approval, the pipeline — which was first announced in late February (see Daily GPI, Feb. 23) — is expected to be available for service on Nov. 1, 2007.

Peoples has contracted for all 360,000 Dth/d of capacity on the proposed 28-mile Kinder Morgan Illinois Pipeline, which will run from Beecher, IL to the Chicago city limits near Burnham, IL. The project combines construction of a new pipeline and a long-term capacity lease on Natural Gas Pipeline Company of America (NGPL), a wholly owned subsidiary of KMI.

Kinder Morgan’s Natural Gas Pipelines group President Scott Parker said the Chicago-area project is one of several pipeline and storage expansion initiatives under way, primarily on NGPL, which represent an ongoing capital investment of approximately $148 million.

“Considering the flexibility and scope of our assets, Kinder Morgan is uniquely positioned to help meet the increasing demand for clean-burning natural gas and to respond to changes in the country’s energy supply sources,” Parker said. “Specific to NGPL, we continue to demonstrate a willingness to invest the dollars necessary to expand our pipeline and storage infrastructure for the benefit of shippers and consumers alike.”

Some of NGPL’s more significant projects include:

KMI owns an interest in or operates approximately 43,000 miles of pipelines that transport primarily natural gas, crude oil, petroleum products and CO2; more than 150 terminals that store, transfer and handle products like gasoline and coal; and natural gas distribution service to over 1.1 million customers.

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