Transwestern Pipeline Co. has proposed a three part expansion program to boost capacity of its San Juan basin gas pipeline lateral by as much as 275 MMcfd.
The company said added capacity is needed to serve market demand for San Juan basin gas in Transwestern's traditional California market and in markets on the eastern end of its pipeline system.
Expansion plans include adding compression at two sites in San Juan County of Northwest New Mexico and adjusting main line operating pressure at Thoreau, N.M. (46516 bytes) Transwestern also proposes to buy a 77.7% interest in Northwest Pipeline Corp's La Plata facilities, extending from Ignacio, Colo., to Bloomfield, N.M.
Combined effects of the expansion would increase Transwestern's pipeline capacity out of the San Juan basin to about 795 MMcfd at an estimated cost of $35.6 million.
The expansion program, if completed as proposed, would not change Transwestern's existing transportation rates in the region.
A unit of Enron Corp., Houston, Transwestern can move more than 1 bcfd of gas to customers at either end of its 4,500 mile system that originates in West Texas and western Oklahoma.
EXPANSION OVERVIEW
Transwestern in an application to the Federal Energy Regulatory Commission early in October asked for a permit to add a 7,000 hp compressor at its Bloomfield compressor station and build a 10,000 hp compressor station near Bisti, N.M.The two projects would expand Transwestern's San Juan capacity by about 170 MMcfd, all of which is committed to firm transportation agreements. Amoco Energy Trading holds 90 MMcfd and Meridian Oil Trading Inc. 80 MMcfd. Both are units of San Juan's largest gas producers.
FERC also must decide whether to allow Transwestern to add still more San Juan lateral capacity by varying main line operating pressure at Thoreau. Transwestern estimates that decreasing main line operating pressure to as little as 800 psi from about 950 psi at Thoreau would curb main line capacity to California by as much as 140 MMcfd. However, it also would boost Transwestern's yearly capacity out of the San Juan basin by 85 MMcfd and peak day capacity by as much as 105 MMcfd.
"The flexibility requested in operating our main line facilities recognizes today's market realities of intense interstate pipeline competition for the California market and unmet demand for greater pipeline access from the San Juan basin," Transwestern said "It also allows Transwestern to respond on a real time basis to future changes in the dynamics of the marketplace."
Transwestern proposes to pay $21 million for controlling interest in Northwest's La Plata facilities. As part of the purchase, Transwestern has subscribed to 75 MMcfd of La Plata facilities capacity, including 60 MMcfd that continues through the San Juan facilities to be expanded. Northwest is to assign to Transwestern firm contracts for the remaining 201 MMcfd of capacity.
The shares of interest and transportation capacity acquired by Transwestern are to be adjusted based on certain undisclosed elections by Northwest customers.
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