Kinder Morgan Inc. announced a series of projects Monday that will increase transportation and storage capacity and service flexibility on Natural Gas Pipe Line Company of America (NGPL), which delivers gas to Chicago and Midwest markets from producing fields in West Texas, the Midcontinent and the Gulf Coast regions.

The projects, which include the purchase of the Black Marlin Pipeline from Northern Natural, an expansion of existing NGPL assets in northeast Texas and southern Oklahoma, and an expansion of the Sayre storage field in Oklahoma, represent an investment of $52 million, Kinder Morgan said.

“This expansion reflects our commitment to investing in infrastructure that will provide additional opportunities for shippers looking to move supplies of Rocky Mountain natural gas out of the Midcontinent to other markets or storage facilities connected to the NGPL system,” said CEO Richard D. Kinder. “We have long-term contracts in place to support these projects, which will provide an important source of stable, fee-based income for many years to come.”

The projects include a $2 million integration of the Black Marlin Pipeline system into the NGPL system. FERC approved NGPL’s $1.5 million purchase of Black Marlin from Northern Natural in August (see Daily GPI, Aug. 25). The 38-mile, 30-inch pipeline stretches from Bryan County, OK, to Lamar County, TX, and runs parallel to a portion of the 191-mile A/G Line, which connects NGPL’s Amarillo Mainline with its Gulf Coast Mainline.

The 38,000 Dth/d of incremental capacity added to the A/G system as a result of the integration of the pipeline was fully subscribed in an open season under long-term contracts. Service is expected to begin later this month, pending completion of the tie-ins. The Commission also approved NGPL’s request to lease back 60,000 Dth/d of capacity to Northern Natural so it could continue to provide transportation service to a 1,000 MW power plant in Paris, TX, owned by Lamar Power Partners LP.

Based on the results of another open season held recently, NGPL will be adding another 51,000 Dth/d of Cross Haul capacity on its A/G system and 20,000 Dth/d of incremental capacity on its Oklahoma Extension, also known as Segment One. Segment One originates in Wise County, TX, and extends 90 miles north to NGPL’s Compressor Station 801 in Carter County, OK.

The A/G system picks up at that point and continues 200 miles east, terminating at the NGPL mainline in Cass County, TX. To accommodate the additional volumes, NGPL will install new horsepower at Compressor Stations 801 and 155 and modify existing equipment at Compressor Stations 154 and 802. All of the capacity has been sold under long-term contracts. NGPL plans to file for FERC approval later this year and expects service to begin during the second quarter of 2006.

As part of a separate open season, NGPL received shipper commitments for a 10 Bcf of additional working gas capacity in the Sayre storage field in Beckham County, OK. The additional capacity will be created by drilling additional wells, installing more compression and dehydration equipment and expanding the gathering system. All of the 10 Bcf of incremental capacity is fully subscribed under long-term contracts. NGPL said it plans to file for FERC approval of that project later this month and expects the additional volumes to be available during the first quarter of 2006.

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