Midcoast Interstate Transmission’s (MIT) four-year effort toblock construction of Southern Natural’s North Alabama Pipeline iscoming to a close as the line is poised to start flowing gas. The120-mile, 70 MMcf/d mainline extension is seen as a threat by MIT,which has enjoyed a monopoly over transportation in that region foryears.
The pipeline, which will run from Tuscaloosa, AL, to Huntsville,AL, “is ready to go,” said Mel Scott, a spokesman for El PasoEnergy. Southern Natural became an El Paso subsidiary when Sonatmerged with El Paso last October. “It has its FERC approval forservice, but as of yet there have been no nominations. That is upto the customers, but it could happen as soon as later this week.”Still, it’s not clear when the customers for which the extensionwas built, such as Decatur Utilities, will be able to make thechange to Southern Natural.
Gary Borden, a spokesman for Decatur Utilities, said the Alabamautility has not switched from MIT yet. He said Decatur is waitingfor some system improvements on the North Alabama line to befinished and could not give a good time estimate as to when servicemight be switched. He did say, however, that Decatur expectsnoticeable savings to be generated from the competition between thetwo pipelines in the future.
When the North Alabama project starts flowing, MIT’s 47-yearmonopoly as the area’s sole source of gas will end. The monopolywas not given up easily. A host of stay attempts and objectionsconcerning the project were launched both at FERC and in thecourts. MIT refused to comment on the start-up of the SouthernNatural extension.
MIT had filed to build a joint venture project between itselfand Southern Natural and had also filed its own alternative to theNorth Alabama project. Both filings were defeated at FERC. Thecommission gave its final approval for the pipeline’s constructionin October of 1998.
Landowner objections were even more fierce. The path of thepipeline drew the ire of the GASP Coalition, headed by the notedenvironmentalist Anne Marie Mueser. The protestors won a victory lastMarch when FERC temporarily required an end to construction (see DailyGPI, March 12). Although the pipeline isnow ready to go, issues such as eminent domain and condemnation ofproperty still are pending in various appeals courts. Southern Naturalexpects to have them settled by this spring.
Because of the protests, the primary utilities in the area —Decatur and Huntsville Utilities — were forced into five-yearcontracts with MIT in 1998, despite also signing 20-year contractswith Southern Natural for capacity on the new pipeline. Huntsvillesigned on for 33,254 Dth/d and Decatur inked a 22,000 Dth/dcontract. Both contracts will expire in 2003. The two utilitiesrepresent between 25% and 33.3% of MIT’s system load, a companyspokesman said.
MIT, a subsidiary of Houston-based Midcoast Energy Resources,owns and operates a 295-mile interstate pipeline which runs fromSelmer, TN, to Huntsville, AL.
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