Questar Southern Trails Pipeline Monday notified FERC that it has sold a 45.5-mile segment of its inactive 209-mile West Zone facilities to Southern California Gas for an undisclosed amount.
“We’re talking to [other] parties” to sell the remaining 164 miles of the West Zone pipeline facilities, which were never placed in service, said Dick Flygare, director of strategic planning for Questar Pipeline. “It’s fair to say [that we’re] in the process of trying to exit California.”
In March 2005 the Federal Energy Regulatory Commission approved Questar Southern Trails’ proposal to sell its West Zone segment, which at the time consisted of a 36-mile portion from North Needles, CA, to Essex, CA, and a 209-mile inactive segment that runs from North Needles to Long Beach, CA (see Daily GPI, March 18, 2005). Efforts to sell the 36-mile segment were terminated, with the facilities being placed into service.
The West Zone facilities, which run through the heart of industrial and commercial areas in Southern California, faced opposition from California regulators from the very start. As a result, Questar Southern Trails in January 2005 asked FERC to vacate its certificate to activate the 209-mile West Zone (see Daily GPI, Jan. 3, 2005).
Questar originally proposed Southern Trails as a competitive alternative to Southern California Gas, which has had a lock on the Southern California natural gas market for years. FERC in July 2000 issued a certificate to convert to natural gas and activate the Southern Trails pipeline, a crude oil pipeline that Questar purchased from Arco in late 1998 for $38 million.
The East Zone of Southern Trails, which consists of pipe and related facilities from the San Juan Basin in New Mexico to the California border, went into service in June 2002 (see Daily GPI, June 25, 2002). The East Zone spans approximately 452 miles and transports an estimated 80,000 Dth/d.
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