The on-again, off-again Southern Crossing project of BC Gascould go forward assuming the company agrees to terms specified inan approval from the British Columbia Utilities Commission (BCUC).
“The commission has given us the choice of completing theproject for the winter season of 2000/2001 or of 2001/2002 and wewill spend a few days to determine which is most appropriate tomeet the commission’s other condition that the company accept allrisk for cost overruns beyond 10%,” BC Gas CEO John Reid said in apress release. “However, I expect we will have crews in the fieldthis summer getting going on the land work that precedes pipelineconstruction.”
The project would cost about $350 million (1997 dollars) andwould parallel the existing BC Gas mainline in southern BritishColumbia between Yahk and Oliver. The project would serve growth inLower Mainland peak and seasonal demand and would link thenorth-south Westcoast Energy pipeline connecting to BritishColumbia and the U.S. Pacific Northwest.
In December, BC Gas re-filed for project approval after SouthernCrossing was denied BCUC approval in April 1998. “The commission inits decision felt that the projected growth in demand fromresidential and commercial customers alone on the BC Gas system wasnot sufficient to justify the large capital expenditure at thistime,” BC Gas said in an April statement.
The BCUC ordered BC Gas to explore synergies between theseasonal and peaking needs of its customers and the firm capacityrequirements represented by new power generation plants in theregion. BC Gas then signed up two shippers. The company agreed onterms with BC Hydro for 50% of firm capacity on the proposedpipeline and peak-shaving to be provided to BC Gas by BC Hydro.
Also taking capacity on the project is PG&E Energy TradingCanada Corp. The agreement calls for PG&E Energy Trading to take50% of the project’s capacity from Huntingdon, BC, for 10 years.Southern Crossing also would provide capacity to utility customersin the British Columbia interior.
A BC Gas spokesman said the company has received provincialenvironmental approval for Southern Crossing and federalenvironmental approval is pending.
Joe Fisher, Houston
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