Interstate

A group of 27 LDCs Monday proposed eliminating thestraight-fixed variable (SFV) rate design for all interstatepipelines in favor of a rate design for base or “recourse” servicethat recovers 35% of a pipeline’s fixed costs in the usage rate.

Serving a projected 30 Tcf natural gas market in 2010 willrequire “substantial” expansion of the existing interstate pipelineand storage infrastructure, but the level of construction isn’texpected to be out of line with what the two areas have experiencedin recent years, according to a study released last week by INGAAFoundation Inc. This means that pipe and compressor manufacturersand construction contractors shouldn’t face any problems in meetingthe demand, it said.

Christine Hansen, Interstate Oil and Gas Compact Commission(IOGCC) executive director since 1993, was named to the newCommittee on Natural Gas for the National Petroleum Council (NPC).The committee, formed at the request of U.S. Secretary of EnergyBill Richardson, has been charged with a reassessment of its 1992study “Potential of Natural Gas in the United States,” and willreport back to Richardson by mid-1999.The study will focus on thecapability of the industry to meet growing gas demands and alsowill compare the 1992-98 actual supply-demand with projections madein the 1992 study.

The Coastal Corp.’s Wyoming Interstate Co. (WIC) filed anapplication with the FERC for construction of the Medicine BowLateral, a new 134-mile, 24-inch diameter gas pipeline designed toprovide transportation access to the developing Powder River Basinin Wyoming and Montana. Medicine Bow will receive Powder Rivercoal-bed methane gas from pipelines near Glenrock, WY, andtransport it to WIC’s mainline, west of Cheyenne, WY.

Coastal’s Colorado Interstate Gas (CIG) has teamed up withSouthwest Gas subsidiary Paiute Pipeline on a new gas pipelineproject designed to deliver new coal-bed methane production in Utahto growing markets in Nevada and Southern California.

Coastal’s Colorado Interstate Gas (CIG), and Southwest Gassubsidiary Paiute Pipeline are holding an open season for capacityon a new pipeline to be built from northeast Utah to northernNevada. Jointly sponsored by CIG and Paiute, the Ruby Pipeline willextend more than 400 miles from CIG’s western terminus in UintahCounty, UT, to an interconnection with Paiute Pipeline near Elko,NV. The pipeline also will interconnect with the Kern RiverPipeline near its Dog Valley meter station south of Salt Lake Cityand will pass through the developing coalbed methane fields nearPrice, UT.

The alliance of Public Service Co. of Colorado (PSCo) andColorado Interstate Gas (CIG) have launched the operation of their53-mile, $25 million Front Range Pipeline stretching from theWyoming border south to Platteville, CO, and effectively haltingdevelopment of a competing 109-mile Front Runner Pipeline, proposedby Denver-based KN Energy.

A proposed settlement that calls for the restructuring of thetransportation and sales arrangements of Pacific InterstateTransmission (PITCO) is close at hand and could be filed at FERC assoon as today, says an official involved in the negotiations.

NorAm Interstate Pipelines bought the intrastate Illini Pipelinefrom Houston-based Nuevo Energy Co. Illini Pipeline operates insouth central Illinois, serving customers in the East St. Louismetropolitan area. The line is about 70 miles long and has capacityup to 45,000 MMBtu/d. NorAm will continue to operate Illini as anintrastate system and expects to take over operation of the Illinisystem this summer.