02-5438. Egan Hub Partners, L.P.; Notice of Petition To Amend

March 1, 2002.

Take notice that on February 20, 2002, Egan Hub Partners, L.P. (Egan Hub), 5400 Westheimer Court, Houston, Texas 77056-5310, filed in Docket No. CP01-66-001 a petition to amend the order issued June 14, 2001, in Docket No. CP01-66-000, pursuant to section 7 (c) of the Natural Gas Act to construct and operate a third cavern at its existing storage facility in Acadia Parish, Louisiana, to provide the same level of storage capacity certificated in the June 14 order, all as more fully set forth in the petition 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).

It is stated that by order issued June 14, 2001, Egan Hub was authorized to increase the combined maximum operating capacity of Cavern Nos. I and II in the Egan Storage Facility from 15.5 Bcf to 21.0 Bcf, thereby expanding the maximum operating capacities of each cavern individually from 7.75 Bcf to 10.5 Bcf; install an additional 19,130 HP of compression to increase the aggregate maximum average injection rate from 600 MMcfd to 800 MMcfd; and continue charging market-based rates for its storage and hub services.

Egan Hub maintains that due to changes in the nationwide storage market, net storage withdrawals have steadily declined, while storage inventories have either remained steady or have increased. Egan Hub states that this has resulted in increased inventories of parked gas in storage facilities. Consequently, use of conventional solution mining or the Solution Mining Under Gas technique to expand the cavern space of Cavern Nos. I and II in the Egan Storage Facility can no longer occur at a pace necessary for Egan Hub's market requirements. Therefore, Egan Hub states that it has had to examine alternative means in order to continue the expansion authorized by the June 14 order, while accommodating the increased storage inventories in the Egan Storage Facility. Accordingly, Egan Hub requests authorization to amend the June 14, 2001 order to provide for the construction and operation of a third storage cavern at the Egan Storage Facility (Cavern No. III).

Egan Hub states that the proposed Cavern No. III will be developed for the increment of capacity approved in the June 14 order but not yet constructed in the existing Cavern Nos. I and II. Egan Hub states that the total combined capacity of the three caverns will not exceed the certificated 21 Bcf, nor will the maximum capacity of any single cavern exceed 10.5 Bcf consistent with the June 14 order. Egan Hub maintains that since it does not propose to increase the certificated storage capacity nor the injection or withdrawal capability of the Egan Storage Facility, the proposal does not alter the Commission's determination that Egan Hub lacks significant market power and may charge market-based rates for storage and hub services.

Egan Hub requests waiver as to Exhibit K (cost of facilities), Exhibit L (financing), Exhibit N (revenues, expenses and income), and Exhibit O (depreciation and depletion) as required by Section 157.14 of the Commission's Regulations. In addition, Egan Hub requests waiver of Section 284.7(e) of the Commission's Regulations, which requires that natural gas companies providing Part 284 storage services charge reservation fees that recover all fixed costs based on the SFV rate design methodology, and the accounting and reporting requirements of Part 201 and Section 260.2 (Form No. 2A) which are also based on the presumption that cost-based rates are being charged and collected.

Questions regarding the details of this proposed project should be directed to Steven E. Tillman, Director of Regulatory Affairs, Egan Hub Partners, L.P., P.O. Box 1642, Houston, Texas 77251-1642 at [phone].

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 March 22, 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.

Persons who wish to comment only on the environmental review of this project should submit an original and two copies of their comments to the Secretary of the Commission. Environmental commenters will be placed on the Commission's environmental mailing list, will receive copies of the environmental documents, and will be notified of meetings associated with the Commission's environmental review process. Environmental commenters will not be required to serve copies of filed documents on all other parties. However, the non-party commenters will not receive copies of all documents filed by other parties or issued by the Commission (except for the mailing of environmental documents issued by the Commission) and will not have the right to seek court review of the Commission's final order.

The Commission may issue a preliminary determination on non-environmental issues prior to the completion of its review of the environmental aspects of the project. This preliminary determination typically considers such issues as the need for the project and its economic effect on existing customers of the applicant, on other pipelines in the area, and on landowners and communities. For example, the Commission considers the extent to which the applicant may need to exercise eminent domain to obtain rights-of-way for the proposed project and balances that against the non-environmental benefits to be provided by the project. Therefore, if a person has comments on community and landowner impacts from this proposal, it is important either to file comments or to intervene as early in the process as possible.

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 petition to amend 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.

Magalie R. Salas,

Secretary.