Williams yesterday asked FERC for the green light to reactivateand expand its liquefied natural gas (LNG) import services at itsCove Point terminal in Lusby, MD to meet the growing demand on theEast Coast.

In its application, Williams proposed reactivation its existingLNG facilities and import services by April 1, 2002, andconstruction of a fifth LNG storage tank to boost its capacity to7.8 Bcf. The 850,000-barrel LNG tank would have a targetedin-service date of Sept. 1, 2003. Williams has estimated thereactivation/expansion project would cost $103 million.

The project would make the Cove Point facility, which Williamspurchased from affiliates of Columbia Energy Group last June for$150 million, the largest import facility in the United States,with a send-out capacity of 1 Bcf/d (see Daily GPI, May 4, 2000).Cove Point is one of only four LNG import terminals in the nation.

“This project will allow significant volumes of competitivelypriced natural gas to be introduced from new supply sources to theEastern Seaboard,” said Gary Lauderdale, senior vice president andgeneral manager of Williams’ Transcontinental Gas Pipe Line.

“There is clearly strong market demand for the reactivation ofthis terminal, as evidenced by the long-term binding precedentagreements that have been executed for 100% of the capacity createdby the project,” he noted. Customers have entered into 20-yearbinding precedent agreements for the entire 750 MMcf/d of send-outcapacity that was offered in a recent open season, said Lauderdale.

Constructed in the mid-1970s at a cost of $400 million, the CovePoint facility has operated as an LNG peak-shaving facility,serving customers in the Mid-Atlantic and Southeast, since 1995. Itcurrently has LNG storage capacity of 5 Bcf and a liquefactioncapacity of 15 MMcf/d. The import terminal has a send-out capacityof 1 Bcf/d. The facility also includes an 87-mile, 36-inch diametergas pipeline that connects with pipelines owned by Columbia Gas,Consolidated Natural Gas and Washington Gas Light.

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