01-31062. Pacific Gas and Electric Company; Standard Pacific Gas Line Incorporated; GTrans LLC; PG&E Gas Transmission, Northwest Corporation; Notice of Applications

December 11, 2001.

Take notice that on November 30, 2001, Pacific Gas and Electric Company (PG&E), Standard Pacific Gas Line Incorporated (Stanpac), GTrans LLC (GTrans), and PG&E Gas Transmission, Northwest Corporation (GTN), (collectively referred to as Applicants), filed in Docket Nos. CP02-39-000, CP02-40-000, CP02-41-000, and CP02-42-000, pursuant to sections 7(b) and 7(c) of the Natural Gas Act (NGA) and parts 157 and 284 of the Federal Energy Regulatory Commission's (Commission) regulations, for a series of authorizations that, taken together, will permit them to extend PG&E's existing intrastate natural gas transmission system to a new market center located in the State of Oregon, near Malin, Oregon, thereby integrating PG&E's transmission and storage systems into the interstate pipeline grid and bringing them under FERC regulation, all as more fully set forth in the application, which is on file with the Commission and open to public inspection. This filing may also be viewed on the web at http://www.ferc.gov using the “RIMS” link, select “Docket #” and follow the instructions (call 202-208-2222 for assistance).

Applicants state that currently:

• PG&E is an integrated utility providing retail electric and natural gas service to millions of customers in California. As part of its utility operations, PG&E owns and operates an extensive intrastate natural gas transmission system in northern California which is regulated by the Public Utilities Commission of the State of California (CPUC) pursuant to the Hinshaw exemption to the Natural Gas Act. PG&E recently filed a voluntary petition for bankruptcy on April 6.
• Stanpac owns a Hinshaw pipeline (the Stanpac Assets) in California which is operated by PG&E pursuant to a March 28, 1996 Stanpac System Management and Operating Agreement (Stanpac System Agreement).
• GTN is an interstate pipeline extending from the U.S.-Canada border, through the states of Idaho, Washington and Oregon, to the California-Oregon border where it currently interconnects with PG&E's natural gas transmission system.
• GTrans is a newly created entity formed for the purpose of owning and operating an interstate natural gas pipeline system that will result from the integration of PG&E's gas transmission system with an interstate pipeline segment to be acquired from GTN.

The Applicants seek approval for PG&E's reorganization into an interstate pipeline as part of its plan to emerge from bankruptcy. As such, the Applicants indicate that their requests for Commission action and their acceptance of the requested authorizations are conditioned upon bankruptcy court approval. They further submit that formation of the new interstate pipeline system will, among other things: (i) create a new market center at Malin, Oregon, where GTN, Tuscarora Gas Transmission Company (Tuscarora) and GTrans will interconnect at a single point, (ii) standardize the terms and conditions for transportation of natural gas in northern California with the interstate pipeline grid, and (iii) facilitate future pipeline expansions within and outside the State of California.

Applicants propose a limited transition period during which GTrans will offer service under rates, terms and conditions that are virtually identical to PG&E's existing CPUC-approved rates, terms and conditions, including the rates, terms and conditions for open-access transportation and storage approved by the CPUC in the Gas Accord settlement. Applicants propose that the transition period end on the date that FERC accepts a section 4 filing to be made by GTrans no later than 14 months after GTrans accepts its requested certificate. In that section 4 filing, GTrans will propose to amend its open-access tariff to comply with all Commission regulations and policies applicable to open-access pipelines. Subject to certain priority rights for service to the reorganized PG&E and certain existing customers of PG&E under pre-existing, CPUC-authorized long-term contracts, GTrans proposes to hold an open season to award capacity to be taken under the rates, terms and conditions in the section 4 filing.

Specifically, the Applicants request that the Commission take the following actions:

• Issue a certificate of public convenience and necessity authorizing PG&E to acquire from GTN a segment of existing pipeline approximately three miles in length beginning at the existing interconnection between GTN and PG&E's transmission system, extending north across the California-Oregon border and ending at the interconnection between GTN and Tuscarora near Malin, Oregon (the Oregon Segment) and to integrate it with PG&E's existing gas transmission system (the result of this combination being the GTrans Assets);
• Issue a certificate of public convenience and necessity authorizing GTrans to acquire the GTrans Assets from PG&E;
• Issue a blanket certificate under part 284, subpart G of the Commission's regulations authorizing GTrans to operate the GTrans Assets and the Stanpac Assets as an integrated interstate pipeline system and to provide open-access interstate transportation and storage services to customers within and outside California, including service to the reorganized PG&E;
• Issue a certificate of public convenience and necessity under Part 157 of the Commission's regulations authorizing GTrans to assume and provide service under pre-existing, CPUC-authorized long-term PG&E transportation contracts with (i) Line 401 expansion shippers, (ii) expedited application docket (EAD) customers, (iii) enhanced oil recovery (EOR) customers; (iv) Crockett Cogeneration; and (v) the Sacramento Municipal Utility District (SMUD);
• Issue a blanket construction certificate to GTrans under 18 CFR part 157, subpart F;
• Issue a certificate of public convenience and necessity under part 157 of the Commission's regulations authorizing Stanpac to provide transportation service to Chevron and GTrans pursuant to the Stanpac System Agreement;
• Adopt and approve the rates, terms and conditions set forth in GTrans' proposed FERC Gas Tariff and the individual rate schedules attached in Exhibit P to the Application as initial rates, terms and conditions for GTrans service under section 7 of the NGA and grant such waivers as are necessary to permit GTrans to offer service under such rates, terms and conditions;
• Authorize GTN to abandon the Oregon Segment by sale to PG&E;
• Authorize PG&E to abandon the GTrans Assets by transfer to GTrans;
• Grant Stanpac a waiver of the filing and reporting obligations and the open-access requirements ordinarily imposed on natural gas companies;
• Grant Stanpac a waiver of the “shipper-must-have-title” rule to permit GTrans to use Stanpac capacity to transport gas owned by GTrans shippers on the Stanpac system under GTrans contracts and tariffs;
• Grant GTrans a limited waiver of the “shipper-must-have-title” rule to permit the reorganized PG&E, during the transition period, to use GTrans transportation capacity to transport customer-owned gas for the reorganized PG&E's noncore transportation customers;
• Rescind PG&E's existing limited-jurisdiction certificate under § 284.224 of the Commission's regulations;
• Rescind the declarations of exemption under the Hinshaw Amendment granted to Stanpac in Docket No. CP86-666-000 and to PG&E in Docket No. G-2489;
• Pregrant the abandonment of services under PG&E's existing Gas Accord transportation and storage contracts at the end of their contract terms and authorize GTrans to provide service under interim contracts for the remainder of the transition period, while reserving the capacity underlying such interim contracts for award in the open season; and
• Waive the requirement that Applicants accept their certificates within thirty days and grant such other waivers and other and further relief as may be proper and appropriate.

Any questions regarding this application may be directed to Donald K. Dankner, attorney for the Applicants, Winston & Strawn, 1400 L Street, NW., Washington, DC 20005, at [phone], fax [phone], or E-mail: [e-mail].

There are two ways to become involved in the Commission's review of this project. First, any person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before January 29, 2002 file with the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's rules of practice and procedure (18 CFR 385.214 or 385.211) and the Regulations under the NGA (18 CFR 157.10). A person obtaining party status will be placed on the service list maintained by the Secretary of the Commission and will receive copies of all documents filed by the applicant and by all other parties. A party must submit 14 copies of filings made with the Commission and must mail a copy to the applicant and to every other party in the proceeding. Only parties to the proceeding can ask for court review of Commission orders in the proceeding.

However, a person does not have to intervene in order to have comments considered. The second way to participate is by filing with the Secretary of the Commission, as soon as possible, an original and two copies of comments in support of or in opposition to this project. The Commission will consider these comments in determining the appropriate action to be taken, but the filing of a comment alone will not serve to make the filer a party to the proceeding. The Commission's rules require that persons filing comments in opposition to the project provide copies of their protests only to the party or parties directly involved in the protest.

Comments, protests and interventions may be filed electronically via the Internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's Web site under the “e-Filing” link.

If the Commission decides to set the application for a formal hearing before an Administrative Law Judge, the Commission will issue another notice describing that process. At the end of the Commission's review process, a final Commission order approving or denying a certificate will be issued.

Linwood A. Watson, Jr.,

Acting Secretary.