In an effort to bring burgeoning Rocky Mountain gas production to the Midcontinent region, Williams Gas Pipeline has filed an application for a new $365 million pipeline that would run from the Cheyenne Hub in northern Colorado to multiple pipeline interconnections in southwestern Kansas and the panhandle of Oklahoma.

The proposed Western Frontier Pipeline would include 400 miles of 30-inch diameter pipe and 30,000 horsepower of compression. It would transport up to 540,000 Dth/d of gas to markets in the Midcontinent.

“Western Frontier Pipeline is a cost-effective, environmentally responsible way to transport natural gas from prolific Rockies supply basins to markets in the Midcontinent,” said Kim Cocklin, senior vice president and general manager of Williams’ Central and Texas Gas systems. “We look forward to building this pipeline to help alleviate the current shortage of interstate pipeline capacity coming out of the region, which was recently cited by the U.S. Energy Information Administration.”

However, in its FERC application, Williams said one of the main reasons it is building this pipe is that Midcontinent gas supplies are rapidly going away, resulting in substantial throughput declines on Williams’ pipeline systems at a time when gas demand is on the rise. The estimated 97 Tcf of recoverable and potential reserves in the Midcontinent supply basins are already 54% depleted, and field pressures have dropped significantly. The Hugoton Basin, a major supply basin in western Kansas and Oklahoma, has shown production declines recently of 10%/year. Reservoir pressures in the basin have dropped to 100 psi from 400 psi. The story is similar in the Anadarko Basin, said Williams, where decline rates average 4.8%/year.

“The Hugoton Basin, which is a shelf like extension of the Anadarko Basin, is a major supply basin for…Williams Central pipeline system via its Kansas-Hugoton 26-inch and Straight-Blackwell 26-inch pipelines. These facilities transport supplies east from the Hugoton Basin to market areas in Kansas, Oklahoma, and Missouri,” the company said. “In recent years, both of these pipelines have had significant amounts of unutilized capacity during peak demand periods due to lack of available supply. Beyond the need to maintain existing market demand, future growth in Midcontinent markets served by Williams Central and other Midcontinent interstate pipelines will likely be constrained without viable connections to alternative supply basins, such as that proposed by Western Frontier.”

In contrast to the mature basins in the Midcontinent region, those in the central Rockies (Powder River, Big Horn, Wind River, and Green River basins) are estimated to be only 16% depleted and are exhibiting proliferating production. They also are estimated to hold 173 Tcf of potential and recoverable reserves.

While Midcontinent gas supplies are drying up, demand is growing rapidly, particularly from new power generation projects. Williams said demand from new power generation in the Midcontinent region could “more than double by 2004, placing increasing demand on already declining Midcontinent supplies.” Active winter generating capacity in the region currently is 11,439 MW. Williams Central serves about 4,420 MW of that capacity with 1,150 MDth/d of natural gas. But an additional 1,410 MW of generation capacity is under construction and will require an additional 305 MDth/d, the pipeline said.

“In addition to existing and anticipated gas requirements for power generation on Williams Central’s system, it has experienced increased load requirements from traditional LDCs further testing existing supplies from mid-continent areas,” the company added.

On June 15, Western Frontier started a binding open season for firm transportation service, which led to precedent agreements for 365,000 Dth/d of the 540,000 Dth/d available capacity. Shippers expressing interest included producers, marketers, LDCs, and utility end users. Precedent agreements were signed by Marathon Oil for 75,000 Dth/day, Williams for 200,000 Dth/day, Utilicorp United for 15,000 Dth/day and Entergy Power Generation for 75,000 Dth/day. The initial term for all these agreements is 10 years, except for Marathon, which has committed to a five-year term with an option to extend an additional two years. Other shippers have expressed serious interest for the remaining capacity on Western Frontier, Williams said, and active negotiations are moving forward.

The Western Frontier project will include 399 miles of 30-inch diameter mainline, a 9.7-mile 16-inch diameter lateral line to connect the 30-inch mainline with the Wattenberg gas processing plant east of Denver, CO., and two interconnecting laterals at the Cheyenne Hub, which include one to connect with WIC and another to connect with CIG. Western Frontier also will construct and operate two compressor stations: the Chalk Bluff station with one 10,000 hp compressor at the Cheyenne Hub, and the Denver station with two 10,000 hp turbines. Nine measurement facilities are proposed at connections with CIG, WIC, the Wattenberg plant, Williams Central’s Kansas-Hugoton pipeline, Northern Natural, NGPL, Panhandle, ANR and Williams Central’s Straight-Blackwell pipeline. The Western Frontier pipeline is anticipated to be in service by Nov. 1, 2003.

Customers interested in the project should contact Donny King at (270) 688-6968, Mark Elliott at (270) 688-6637 or Dale Sanders at (270) 688-6944. More information also is available on the Internet at https://westernfrontier.williams.com.

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