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Southern California Gas (SoCalGas) has called on FERC to put anend to El Paso Natural Gas’ alleged practice of over-booking firmprimary capacity at the SoCalGas/Topock delivery point inCalifornia. The distributor contends its own firm entitlements atthe delivery point have been cut between 25%-57% on a daily basisbecause of El Paso’s actions, and that it’s costing it nearly$46,000 a day.
In Section 5 complaint filed last week, SoCalGas asked theCommission to officially rule the SoCalGas/Topock delivery point isfully subscribed and “unavailable” for sales on a firm primarybasis, and that it also was fully subscribed during the Jan. 1 openseason in which El Paso awarded more than 1.2 Bcf/d of firmcapacity on its system to affiliate, El Paso Merchant Energy, andWilliams Energy Marketing.
Additionally, SoCalGas requested that FERC order El Paso to”cease and desist” violating existing FERC regulation and precedentby continuing to sell firm primary capacity into the delivery pointwhen none is available. And, it wants FERC to order that the ElPaso capacity acquired during the open season last Jan. 1 orafterwards be re-scheduled into the SoCalGas/Topock delivery pointon a secondary firm basis.
Although the Commission has never ruled on whether theSoCalGas/Topock delivery point is fully subscribed on a firmprimary basis, the California distributor noted that FERC”expressly held” last April that El Paso could not sell firmprimary capacity into a point that is fully subscribed. But El Pasocontinues to flout that ruling, it said.
For example, SoCalGas cited one of El Paso Merchant Energy’scontracts with El Paso for firm primary Block III capacity (387,261Mcf/d) for delivery to SoCalGas/Topock, and Williams EnergyMarketing’s contract for 99,309 MMcf/d of El Paso capacity withprimary firm delivery rights into the SoCalGas/Topock deliverypoint. Also, it noted that El Paso Merchant has entered into aseries of pre-arranged capacity release transactions each for50,000 Dth/d of Block III capacity into the SoCalGas/Topock pointfor a four-month period (July, 1-Oct. 31, 2000).
This capacity, as well as other capacity awarded by El Pasoduring the Jan. 1 open season and afterwards, “was acquired withthe express notice that the capacity would be subject toprospective changes in El Paso’s capacity-allocation procedures,”SoCalGas said. “Consistent with that notice,” it urged FERC todirect El Paso to re-schedule the capacity on a secondary basisinto the SoCalGas/Topock delivery point.
El Paso’s scheduling practices at SoCalGas/Topock, as well asits contracts with affililiates, have been the target of othercomplaints brought by Amoco Production and the California PublicUtilities Commission. While they involved broader issues, SoCalGascontends the issue raised and remedy sought in its complaint aremore “narrow in scope,” and as a result could “aid in theresolution of [the] other pending related proceedings.”
The distributor is seeking fast-track processing of itscomplaint, saying that “only prompt Commission action can preventcontinuing harm to SoCalGas and similarly situated shippersresulting from El Paso’s proscribed behavior.”
SoCalGas estimated the design capacity at SoCalGas/Topock is539,464 Mcf/d, but El Paso by its own admission has contracted on aprimary basis for nearly three times that amount at the deliverypoint — 1,466 MMcf/d. This has led to extensive cuts in thedistributor’s daily firm entitlements at the delivery point,SoCalGas said, adding that it was costing it about $46,000 a day or$17 million annually.
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