FERC's Hebert pledges quick action on pipelines

US Federal Energy Regulatory Commission Chairman Curtis Hebert has told Congress the agency will act as "quickly as possible" on applications to build new California pipeline capacity. But, he noted, the federal agency has no authority over intrastate pipeline construction and urged California officials to eliminate any constraints hindering pipeline development within the state.

Mar 2nd, 2001


By the OGJ Online Staff

HOUSTON, Mar. 2�US Federal Energy Regulatory Commission Chairman Curtis Hebert has told Congress the agency will act as "quickly as possible" on applications to build new California pipeline capacity.

But, he noted, the federal agency has no authority over intrastate pipeline construction and urged California officials to eliminate constraints hindering pipeline development within the state.

Testifying before the House Subcommittee on Energy and Air Quality in Washington, DC, Hebert offered his support for pipeline construction, noting new pipelines are is needed in order for gas buyers to reach the lowest selling producers.

Along with high electric power prices, high gas prices have become a controversial subject in California. Questions about pipeline availability are part of the politically combustible mix.

After it recently received bids totaling 14.4 bcfd for 1.22 bcfd of available capacity on its pipeline system serving California, El Paso Corp. said it would hold an open season to gauge interest in new capacity (OGJ Online, Mar. 1, 2001).

In the past 7 months, Hebert said, FERC has issued certificates for three projects with 119 MMcfd of capacity that could benefit the West. He said the commission is prepared to speed up approval of pipelines serving California and the West, including raising the dollar limit on automatic authorizations.

"This will allow pipelines to construct needed facilities automatically, as long as they comply with environmental regulation," Hebert explained. However, the FERC chairman pointed out new interstate capacity will only be effective if there is available local capacity to deliver gas downstream of the interstate.

"For example," he said, "it appears the intrastate gas transportation network in southern California is constrained and this may, to some extent, have affected gas prices in that area, which are among the highest in the nation." Hebert said pipelines companies should coordinate with local distribution companies, public utilities, and state officials.

In addition, Hebert told committee members he is "fully" committed to acting on requests for construction of pipeline infrastructure to deliver Alaskan gas to the Lower 48 states. While no application has been filed with respect to an Alaskan pipeline, he said, the FERC staff has reviewed the various proposals.

"I well understand that the ongoing development of Canadian and Alaskan natural gas supplies is critical to our nation's energy needs and security," he said.

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