Memorandum

BP announced last week that it signed a memorandum of understanding with Brass LNG in Nigeria to purchase two million metric tons a year of liquefied natural gas (LNG). The deal, which is expected to be concluded later this year, will cover a 20-year period starting in 2010. The LNG will be delivered by Brass and used by BP to supply markets in the Atlantic basin, particularly the United States and United Kingdom. Under the flexible contract, LNG also may be delivered to other existing LNG markets and a number of proposed new terminals that BP and its partners are seeking to develop in New Jersey, Texas, elsewhere in the U.S. and in Italy. The new LNG supply will compliment BP’s equity LNG from Trinidad, Australia, Indonesia and Abu Dhabi, which will make up the majority of its portfolio, together with LNG from Egypt and third-party purchase agreements with Oman and Qatar.

Aux Sable will sell all of the natural gas liquids from Chicago gas processing facility to BP under a binding memorandum of agreement between the major producer and Enbridge Inc., which owns 42.7% of Aux Sable. The Aux Sable plant is located at the delivery end of the Alliance Pipeline, which transports natural gas and liquids 1,900 miles from western Canada to the Midwest.

Kinder Morgan Energy Partners LP and Sempra Pipelines & Storage on Wednesday announced they have entered into a memorandum of understanding (MOU) to develop a 1,500-mile interstate natural gas pipeline that would link producing areas in the prolific Rocky Mountain region to market areas in the upper Midwest and eastern United States.

In another strong endorsement, subsidiaries of EnCana Corp. and Entrega Gas Pipeline Inc. have entered into a Memorandum of Understanding (MOU) to support Kinder Morgan Energy Partners LP (KMP) and Sempra Pipelines & Storage’s 1,500 mile Rockies Express natural gas pipeline project. The pipeline, first proposed in August (see Daily GPI, Aug. 18), would be the largest domestic gas pipe proposal in more than 20 years, delivering growing gas supplies from the Rocky Mountains to upper Midwest and eastern U.S. markets.

The heads of FERC and the Commodity Futures Trading Commission (CFTC) are due to sign a memorandum of understanding Wednesday in which they will pledge to coordinate requests to companies when seeking information about regulated natural gas and electric transactions, a FERC spokesman said.

FERC and the U.S. Army Corps of Engineers have signed a memorandum of agreement promoting a more streamlined regulatory process through early coordination of efforts to identify the purpose, needs and alternatives for regulated natural gas projects.

New offshore energy projects developed in Nova Scotia will now operate under a more efficient approval process, following a memorandum of understanding (MOU) between the province’s energy minister and the Canadian government Friday.

New offshore energy projects developed in Nova Scotia will now operate under a more efficient approval process, following a memorandum of understanding (MOU) between the province’s energy minister and the Canadian government Friday.

The Department of the Interior’s Minerals Management Service and the state of Louisiana signed a memorandum of understanding Friday to jointly implement a royalty-in-kind (RIK) pilot program for federal oil and gas leases located in the 8(g) zone offshore Louisiana. The pilot program also may potentially include state oil and gas leases if the state so decides.