2000

Transco’s Sundance expansion project received two major boostslast week as Carolina Power and Light (CP&L) and Southern Co.each said they have purchased major capacity deals on the yet-to-beconstructed line. The contracts will go into effect when Sundancebecomes operational in the Spring of 2002, barring rejection fromFERC.

Last week was an “Excedrin headache” kind of week for KinderMorgan Inc. It began with the company trying to get a Coloradocourt to toss out a Justice Department complaint alleging thataffiliate Natural Gas Pipeline Co. of America (NGPL) failed toobtain the necessary air quality permits for a compressor stationit built in Colorado more than 20 years ago. The complaint, whichJustice brought on behalf of the Environmental Protection Agency,seeks the maximum statutory penalties from the company, which couldsoar into the millions.

The government made a killing in last week’s Central Gulf of Mexico Lease Sale 175. The large winnings were attributed to oil prices that are three times what they were a year ago and gas prices that are double those in 1999. It’s also the last Central sale to benefit from automatic royalty relief.

FERC has suspended Destin Pipeline Co. L.L.C.’sblanket-certificate authority for six months for grossly exceedingthe $19.5 million cost cap earmarked for construction of anoffshore lateral, and for dragging its feet in reporting the costoverrun to the Commission.

The Federal Energy Regulatory Commission last week awarded PetalGas Storage L.L.C. a certificate to increase the total gas storagecapacity of its two caverns in Mississippi by 5.4 Bcf and workinggas capacity by 4.8 Bcf.

Almost a year after it entered Chapter 11 bankruptcy,Houston-based TransTexas Gas Corp.’s reorganization plan tookeffect as the company arranged $52.5 million in exit financing.TransTexas amended its existing DIP Credit Agreement and RevolvingAccounts Receivable Credit Facility, cancelled existing securitiesand issued new securities. This is the final step in emergence fromChapter 11, which began April 19, 1999.

Pacific Gas & Electric issued a high inventory Stage 1 OFOfor today with 3% tolerance for positive imbalances.

Scana Corp. did a little more than dust off its proposedCarolina’s interstate gas pipeline project last week. The company,along with Raleigh, NC, developer DFI Group Inc. and North CarolinaGovernor James Hunt, announced a $1.4 billion project that wouldcombine a new interstate gas pipeline with three new 200 MW powerplants, three ethanol production facilities and a new fiber opticcable in eastern North Carolina.

Reliant Energy’s increased focus on the non-regulated side ofthe energy business has apparently made the former pipeline anddistribution assets of NorAm Energy no longer attractive to thecompany. Reliant said last week it hired an investment banking firmto evaluate strategic alternatives for two of its gas distributioncompanies and its gas pipeline operations.