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SCANA seeks FERC approval for new pipeline

By the OGJ Online Staff

HOUSTON, Dec. 26 -- SCANA Corp. filed with federal regulators today to build a stretch of interstate pipeline to transport liquefied natural gas from a LNG import terminal to a new power plant.

The new 18-mile pipeline will provide access to markets in South Carolina and southeastern Georgia, the company said.

SCG Pipeline, a unit of SCANA, will transport natural gas from an LNG terminal at Elba Island to the site of a proposed 875 Mw natural gas fired power plant in Jasper County, SC. The pipeline is expected to be in-service by November 2003.

Meanwhile, SCANA applied last month to Federal Energy Regulatory Commission for approval to change its pipeline business operations from providing bundled merchant services to being a regulated transportation pipeline. SCANA, Columbia, SC, also owns a natural gas and electricity utility.

The proposed change will alter the way that its pipeline business operates in South Carolina. With new unbundled service, customers will have to purchase their own gas supplies and have the supplies delivered to designated receipt points, SCANA said.

SCANA wants its pipeline company to be under FERC jurisdiction because its current bundled merchant and aggregator functions are no longer needed in today's market. Many customers want increased flexibility to arrange their own gas supplies and transportation.

SCANA also said that increased gas demand in South Carolina's coastal areas has increased demand for more firm transportation service.

The company's current rate structure is inadequate to support continued investment, SCANA said. The new rate structure will mean that customers can commit to firm transportation. With a fair rate of return approved by FERC, the company will be able to better finance its investments in new pipeline facilities.

Under its current rate tariff, rates of return were only 5.1% for the last 12 months which is insufficient to support investment in new facilities, the company said.

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