[Federal Register Volume 60, Number 104 (Wednesday, May 31, 1995)]
[Notices]
[Pages 28400-28401]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-13228]
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DEPARTMENT OF ENERGY
[Docket No. CP95-500-000, et al.]
Southern Natural Gas Company, et al.; Natural Gas Certificate
Filings
May 23, 1995.
Take notice that the following filings have been made with the
Commission:
1. Southern Natural Gas Company
[Docket No. CP95-500-000]
Take notice that on May 15, 1995, Southern Natural Gas Company
(Southern), Post Office Box 2563, Birmingham, Alabama 35202-2563, filed
in Docket No. CP95-500-000 an application pursuant to Section 7(c) of
the Natural Gas Act for a certificate of public convenience and
necessity authorizing the construction, installation and operation of
certain compression facilities and related pipeline interconnection,
measurement, and appurtenant facilities, all as more fully set forth in
the application which is on file with the Commission and open to public
inspection.
Southern states that the proposed facilities will provide the
capacity needed to perform firm transportation service on its pipeline
system in its production area south of its Franklinton Compressor
Station. It is stated that Southern has an extensive supply system in
the offshore Louisiana area and receives approximately 900,000 Mcf per
day (Mcdf) or nearly 60 percent of its annual throughput from the
``east leg'' of its South Louisiana supply system that accesses the
Main Pass, Viosca Knoll and Mississippi Canyon areas. Southern contends
that its efforts to connect new gas supplies in this area and increase
throughput have been hampered recently as a result of capacity
constraints which exist at Southern's Toca Compressor Station. If it is
unable to increase its capacity to move gas from the offshore areas,
Southern states that the markets and customers served by Southern's
system will not have the opportunity to gain access to the significant
number of new sources of supply announced and under development in this
area.
Southern states that its recent gas supply attachment efforts have
been focused on supply prospects which are near Southern's existing
facilities. It is stated that a large number of such prospects are
located in the offshore Louisiana are upstream of Southern's Toca
Compressor Station. Southern states that its supply system in south
Louisiana has two separate main lines, the ``east Leg'' which extends
in to the Main Pass area and the ``west leg'' which extends from the
Franklinton Compressor Station to the Shadyside Compressor Station. It
is stated that the ``west leg'' has traditionally received gas from
interconnections with other interstate pipelines, and supply prospects
in the area are limited. Therefore, Southern states that its ``east
leg'' upstream of the Toca Compressor Station has experienced the most
activity in connecting new gas supplies. It is stated that gas supply
prospects in this area are believed to be substantial. Southern states
that Exhibit Z to its application contains a map and a list of known
prospects in the vicinity of Southern's existing facilities which could
be attached either through jurisdictional pipeline extensions or
through nonjurisdictional gathering lines to Southern's system. While
the potential of many of these prospects is still emerging, Southern
believes that the substantial financial expenditures by producers and
technological advances in the development of deepwater prospects ensure
that the expansion of Southern's facilities to provide access to
downstream markets from this supply area is necessary. It is stated
that the gas supply prospects listed in Exhibit Z are estimated to
contain over 2 Tcf of reserves which could be attached to Southern's
system. Southern also believes that the location of these prospects
make them the most economical gas supplies available to Southern's
system in the near term and foreseeable future. However, in order to
compete with other pipelines for these shippers and customers, Southern
states that it must expand its existing capacity at Toca to enable
these supplies to flow into downstream markets.
It is stated that prior to the recent industry restructuring under
Order No. 636, pipelines generally constructed gas supply facilities
and included the cost of the facilities in future rate filings on a
rolled-in basis. In a post-636 environment, Southern states that the
issue of who should bear the financial responsibility for this type of
project is more complicated. It is stated that this expansion project
is not a traditional [[Page 28401]] market area expansion. Southern
states that this expansion is an enhancement of its current facilities
to enable Southern to transport an additional 140 MMcfd through its
Toca Compressor Station, which is currently operated at or near full
capacity. Southern contends that it has determined that the gas supply
is available and has identified the facilities modifications required
to relieve its system bottleneck at Toca. According to Southern, the
major unresolved issue in the post-636 environment is which industry
segment should initially pay the cost of this type of system
enhancement. Southern states that the distribution segment of the
industry believes that producers should contribute to the cost of
expanding facilities in order to make their gas supplies available to
the market. It is stated that producers have taken the lead in
constructing facilities to attach gas supply to the existing pipeline
infrastructure but do not believe that they should bear the additional
cost of expanding jurisdictional pipeline capacity required to move new
supplies downstream. At the same time, Southern argues that it would be
unfair to expect interstate pipelines to make substantial investments
in new facilities without an opportunity to earn a reasonable return on
their investments.
To strike an appropriate balance, Southern states that its proposal
is an effort to allocate among the stakeholders the cost of this
expansion project that benefits the system as a whole. It is stated
that the cost sharing proposal represents a reasonable sharing--between
the producers for the first 10 years and the transportation customers
thereafter--of the costs required to expand Southern's production area
capacity. By adding additional compression at its Toca Compressor
Station, Southern states that it will increase its capacity to
transport gas supplies through Toca by 140 MMcfd. In addition, Southern
submits that it will require, as part of the transportation agreement,
a commitment from the producers to attach 150 Bcf of new reserves for
every 50 MMcfd of Transportation Demand, or approximately 400 BCF of
additional reserves to Southern's system. Based upon extensive
discussions with producers that have prospects in the areas near
Southern's supply system and with Southern's transportation customers,
Southern believes that an expansion of its Toca Compressor Station as
proposed would benefit the system as a whole and is in the public
interest.
It is stated that producers would benefit from obtaining firm
transportation service in Southern's production area at a competitive
rate. With firm service to the interconnections Southern has with other
interstate pipelines in this area, Southern contends that the producers
will have assured access to a substantial portion of the natural gas
markets in the eastern United States. It is stated that they can elect
to sell any of the new gas supplies they connect to the Southern system
to markets served by the Southern system, and in such case, those gas
supplies would likely be transported under the purchaser's firm and/or
interruptible transportation service agreements.
Southern states that the requirement that producers commit to
attach new reserves to the Southern system provides a substantial
benefit to Southern's firm and interruptible transportation customers.
It is stated that they will have the opportunity to compete for these
new sources of supply without incurring, under Southern's proposed rate
treatment, any increase in their transportation costs as a result of
the construction of the facilities for an initial 10-year period.
Whether these new supplies are transported in the production area under
one of the new 10 year service agreements or to a market on the
Southern system, Southern submits that the proposed expansion of the
Toca Compressor Station will eliminate a capacity constraint and enable
an additional 140 MMcfd to flow into the Southern system via the ``east
leg''. It is stated that this increase in the ``east leg'', however,
will not cause an increase in capacity on Southern's main line.
Southern requests that the Commission act on its request in two
steps. First, Southern requests that the Commission issue an initial
determination that the construction and operation of the proposed
facilities to provide capacity necessary for the performance of firm
production area transportation services on the terms and conditions
described in the application are required by the present or future
public convenience and necessity. Southern states that it is willing to
accept an at-risk condition in the initial determination because its
application does not include the requisite showing of market demand.
Second, after it has submitted executed Firm Transportation Service
Agreements for 100 percent of the additional capacity containing the
terms and conditions described herein and after completion of the
environmental review of the proposed facilities, Southern requests that
the Commission issue an order adopting the initial decision as its
final action in this proceeding and removing the at-risk condition.
Comment date: June 13, 1995, in accordance with Standard Paragraph
F at the end of this notice.
2. ANR Storage Company
[Docket No. CP95-504-000]
Take notice that on May 18, 1995, ANR Storage Company (ANR), 500
Renaissance Center, Detroit, Michigan 48243, filed in Docket No. CP95-
504-000, pursuant to Section 7(b) of the Natural Gas Act (NGA), as
amended, and Secs. 157.7 and 157.18 of the Commission's Regulations
thereunder, an application requesting permission and approval for
abandonment of storage service performed for United Cities Gas Company
(United Cities), all as more fully set forth in the application on file
with the Commission.
ANR states that it is requesting authorization for retroactive
abandonment of storage service that it provides for United Cities under
Rate Schedule X-6 and contained in Original Volume No. 2 of its FERC
Gas Tariff. This service was authorized in Docket No. CP79-453-000. ANR
requests the abandonment of Rate Schedule X-6 effective April 1, 1995,
the date of the termination agreement between ANR and United Cities.
ANR further states that at United Cities' request, commencing April 1,
1995, this service would be provided under ANR's FERC Gas Tariff,
Original Volume No. 1.
ANR states that no facilities are proposed to be abandoned.
Comment date: June 13, 1995, in accordance with Standard Paragraph
F at the end of this notice.
Standard Paragraphs
F. Any person desiring to be heard or to make any protest with
reference to said application should on or before the comment date,
file with the Federal Energy Regulatory Commission, Washington, D.C.
20426, a motion to intervene or a protest 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 Natural Gas Act
(18 CFR 157.10). All protests filed with the Commission will be
considered by it in determining the appropriate action to be taken but
will not serve to make the protestants parties to the proceeding. Any
person wishing to become a party to a proceeding or to participate as a
party in any hearing therein must file a motion to intervene in
accordance with the Commission's Rules.
Take further notice that, pursuant to the authority contained in
and subject to the jurisdiction conferred upon the Federal Energy
Regulatory Commission by Sections 7 and 15 of the Natural Gas Act and
the Commission's Rules of Practice and Procedure, a hearing will be
held without further notice before the Commission or its designee on
this application if no motion to intervene is filed within the time
required herein, if the Commission on its own review of the matter
finds that a grant of the certificate and/or permission and approval
for the proposed abandonment are required by the public convenience and
necessity. If a motion for leave to intervene is timely filed, or if
the Commission on its own motion believes that a formal hearing is
required, further notice of such hearing will be duly given.
Under the procedure herein provided for, unless otherwise advised,
it will be unnecessary for applicant to appear or be represented at the
hearing.
G. Any person or the Commission's staff may, within 45 days after
issuance of the instant notice by the Commission, file pursuant to Rule
214 of the Commission's Procedural Rules (18 CFR 385.214) a motion to
intervene or notice of intervention and pursuant to Sec. 157.205 of the
Regulations under the Natural Gas Act (18 CFR 157.205) a protest to the
request. If no protest is filed within the time allowed therefor, the
proposed activity shall be deemed to be authorized effective the day
after the time allowed for filing a protest. If a protest is filed and
not withdrawn within 30 days after the time allowed for filing a
protest, the instant request shall be treated as an application for
authorization pursuant to Section 7 of the Natural Gas Act.
Lois D. Cashell,
Secretary.
[FR Doc. 95-13228 Filed 5-30-95; 8:45 am]
BILLING CODE 6717-01-P
