Bechtel Corp., project manager for a big expansion program by Pacific Gas Transmission Co. and Pacific Gas & Electric Co., has ordered 400,000 tons of pipe valued at about $400 million from Napa Pipe Corp., Napa, Calif., and Ipsco Inc., Regina, Sask.
Antonio Lancione, Bechtel's project manager, said the order for PGT-PG&E is the largest single equipment order for the expansion project and the world's largest mainline pipe order since the U.S.S.R.'s Yamal gas export line project in the early 1980s.
In other developments involving U.S. gas pipelines:
- Northern Border Pipeline Co. agreed to acquire the recently completed 150 mile, 30 in. Iowa Line from Natural Gas Pipeline Co. of America (NGPL).
- Mojave Pipeline Operating Co. let construction contracts valued at a total $90 million for its 382 mile California pipeline to Gregory & Cook Inc., Houston, and Murphy Brothers Inc., East Moline, Ill.
- The Federal Energy Regulatory Commission granted preliminary approval of an expansion project planned by Transcontinental Gas Pipe Line Corp., Texas Gas Transmission Corp., CNG Transmission Corp., and ANR Pipeline Co.
- Southern Natural Gas Co., Birmingham, Ala., completed its purchase of the 50% interest in Sea Robin Pipeline Co. held by United Gas Pipe Line Co.
- Enron Gas Marketing Inc., Houston, signed a 23 year contract valued at about $1.3 billion to supply the New York Power Authority with more than 33 MMcfd of gas.
- Tejas Gas Corp., Houston, agreed to buy the interests of Occidental Petroleum Corp. and Texas Oil & Gas Corp. in Acadian Gas Group.
PGT-PG&E ORDER
The $1.2 billion expansion by PGT and PG&E involves laying a pipeline parallel to and interconnecting with PGT and PG&E lines from the Canadian border in British Columbia to California. It will hike the system's present 1 bcfd capacity by more than 900 MMcfd (OGJ, Sept. 3, p. 21).
Lancione said the two pipe orders call for deliveries in 1992 and 1993. Construction is expected to begin in early 1992 and be complete in fourth quarter 1993.
Napa, a unit of Oregon Steel Mills Inc., Portland, Ore., will manufacture 650 miles of 36 and 42 in. double submerged, arc weld line pipe.
All of the steel plate for its pipe will be produced at Napa's rolling plate plant in Fontana, Calif., said Oregon Steel Pres. Thomas B. Boklund. The pipe will be formed at its Napa pipe mill, with slab to be produced in Portland.
The contract with Ipsco is for about 180 miles of 42 in. spiral weld pipe, which will be laid in Idaho, Washington, and Oregon. Ipsco will manufacture its pipe in Regina.
Bechtel said Alberta Natural Gas Co. Ltd. and Foothills (South B.C.) will let contracts for almost 50 miles of mainline pipe, to be used for project segments in British Columbia, at a later date.
IOWA LINE
The Northern Border/NGPL deal, subject to FERC approval, calls for a purchase price based on NGPL's cost to lay the line minus any deductions, such as depreciation, allowed by FERC.
Initial capacity of the Iowa Line will be about 300 million MMcfd, planned to increase to 450 MMcfd in summer 1991 when a compressor station at Harper, Iowa, is complete. The capacity can be expanded to 850 MMcfd with more compression.
The line stretches from the current terminus of the Northern Border pipeline at Ventura, Hancock County, Iowa, to NGPL's compressor Station 109 in Keokuk County near Harper. Construction began in June and was finished Oct. 31.
Northern Border and NGPL will proceed immediately with construction of interconnect facilities at Ventura, which the firms expect to complete within a few weeks.
Gas transportation under the Natural Gas Policy Act will start upon completion.
The Northern Border system originates at the Canadian border near Monchy, Sask., where it joins a pipeline moving gas from Alberta.
Northern Border says will either amend its current optional certificate application, now pending before FERC, to extend its pipeline from Ventura to Tuscola or refile to seek approval to purchase the Iowa Line as part of the expansion/extension project.
PURCHASE DETAILS
Under the agreement with NGPL, Northern Border will purchase the Iowa Line upon receipt of an acceptable FERC certificate for the project.
The agreement includes a provision that NGPL will support the proposed purchase before FERC and its inclusion in Northern Border's expansion/extension project up to Station 109.
NGPL officials say they are prepared provide transport beyond Station 109 on their system and will continue marketing efforts with ANR to help expedite transportation to eastern markets.
As part of this agreement, NGPL may sign firm contracts for transportation service on the Iowa Line prior to Northern Border's acquisition of the pipeline.
Northern Border is a general partnership that includes subsidiaries of four major energy companies-Enron, Panhandle Eastern Corp., TransCanada PipeLines, and Williams Cos. Inc. NGPL is a unit of MidCon Corp.
MOJAVE CONTRACTS
Mojave let a $63 million contract for the 220 mile western segment, which it will jointly own with Kern River Gas Transmission Co., to Murphy Bros. That portion will run from Daggett, Calif., to Kern County, near Bakersfield, Calif.
Gregory & Cook will lay the project's 162 mile eastern segment from Topock, Ariz., to Daggett, under a $27 million contract.
Mojave says its pipeline is fully subscribed to move 400 MMcfd to enhanced oil recovery and cogeneration operators in Central California.
Pipe fabrication, right-of-way acquisition, and permitting activities are on course for construction to start in April 1991. The line is planned to be on stream in February 1992.
Mojave earlier let contracts to Fluor Daniel Inc. for general construction management and to Nautilus Engineering to build the line's sole compressor station near Topock.
NORTHEAST EXPANSION
Transco, Texas Gas, CNG, and ANR filed a joint application with FERC to expand their pipeline systems to deliver more gas to customers mainly in the U.S. Northeast.
The project will provide 250 MMcfd of year round firm service on Texas Gas' system through CNG and then to market area customers on Transco's Leidy Line. CNG will move another 129 MMcfd for ANR, of which 31 MMcfd will be delivered to Transco. That will bring Transco's total capacity expansion to 281 MMcfd.
The remaining 98 MMcfd will be moved by CNG for ANR customers. The companies expect to complete the project in two phases by November 1992.
Once Phase 1 is complete, which they expect by Nov. 1, 1991, Transco will add 167 MMcfd. Phase 2 includes the balance of Transco and ANR's volumes. Transco officials say the expansion project was a key element in their decision to acquire Texas Gas in 1988. It is the first major new route for U.S. gas supplies to the Northeast in more than 20 years.
ENRON CONTRACT
During the first 10 years of its new contract, Enron will sell gas to New York Power at fixed prices under its Gas Bank program. During the remaining 13 years, prices will be adjusted monthly based on market conditions.
New York Power will use capacity rights it holds with several East Coast pipelines to begin moving gas under the Enron contract Jan. 1, 1991. The gas will fuel power plants it operates or has built.
The Enron gas may fuel a proposed 150,000 kw power plant New York Power plans to build for Long Island Lighting Co. in Holtsville, Suffolk County, N.Y. The plant is scheduled to be complete in early 1994.
SEA ROBIN, ACADIAN
A new Southern Natural unit acquired the 50% interest in Sea Robin formerly owned by a United subsidiary. Southern Natural, through those two units, now owns 100% of Sea Robin.
The Sea Robin joint venture, formed by units of Southern Natural and United in 1968, operates a 440 mile gas pipeline off Louisiana.
Tejas Gas will buy the interests in the Acadian line held by Oxy and Texas Oil & Gas for cash and other consideration but disclosed no other details.
Acadian is a 560 mile South Louisiana intrastate line which in 1989 had average throughput of 583 MMcfd and revenues of $290.7 million. Oxy unit MidCon Corp. and Texas Oil & Gas purchased what is now Acadian in 1983, and MidCon's interest was later transferred to Oxy.
Copyright 1990 Oil & Gas Journal. All Rights Reserved.
