Interstate natural gas pipeline Questar’s desire to buy a16-inch-diameter under-utilized oil pipeline from New Mexico toCalifornia with the intention of converting it to a 120-130 MMcf/d,700-mile interstate natural gas pipeline is drawing mixed responsesfrom Southern California’s two natural gas utilities.

The nation’s largest gas distributor, Southern California Gas,is keeping a wary eye on the deal, having unsuccessfully opposedtwo new interstate pipelines into the state early in this decade. Neighboring municipal gas utility, the City of Long Beach GasDepartment, where the converted pipeline would terminate is veryinterested in tying in with a new supplier.

The pipeline that Questar Pipeline Co. intends to buy from ARCOPipe Line Co., Houston, originates in the Paradox Basin in NewMexico, crossing into California at the Arizona border and endingin Long Beach (population 440,000), the state’s fifth largest cityand a major international port paired with the City of Los AngelesHarbor.

The city-operated Long Beach Gas Department attempted to buy thepipeline known as the Four Corners Pipeline eight years ago, butnegotiations broke down, according to Chris Garner, generalmanager. He thinks Long Beach is a logical potential customer forQuestar and indicated they will be meeting with pipelinerepresentatives later this month.

“We’re very interested in that pipeline,” Garner said. Fromone-third to half of Long Beach’s supplies come from local sourceswithin the city, which sits atop one of the 20th Century’s largestoil fields. The rest of the supplies come from out of state, mostin and around the San Juan Basin. The department buys its ownsupplies and has a five-year transportation agreement with SoCalGasthat expires at the end of next year, Garner said.

Long Beach has a daily load of about 35 million cf, or 13 bcfannually. SoCal officials indicated they will monitor the Questarproject, which could be the third new interstate gas pipeline intoCalifornia in less than a decade, for its timing (expected to becompleted in the next 18-24 months) and the competitive rate itcharges.

Constructed in 1957 to ship crude oil, the purchase by Salt LakeCity-based Questar Pipeline includes ARCO Lines 90, 91 and 92 for$40 million. Questar will seek Federal Energy RegulatoryCommission approval to convert it. Questar calls the ARCOpipelines “readily convertible,” which will include reconditioningand the addition of compression.

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