Gulf Coast lines seeking more deepwater gas

Gulf of Mexico Gas Pipeline Projects [220793 bytes]

U.S. Gulf Coast area natural gas pipeline operators continue to press projects to make available more outlet capacity for deepwater Gulf of Mexico gas producers.

Koch Gateway Pipeline Co. disclosed plans to expand its Gulf Coast system with an interconnection near Grand Isle, La., and possibly double capacity in a second phase.

Meanwhile, units of El Paso Energy Corp. and Tejas Offshore Pipeline LLC unveiled a proposal for a new 400 MMcfd interconnection at Venice, La.

Koch project

Koch's Grand Isle expansion would complement the recently proposed Sea Star Pipeline LLC project (OGJ, Sept. 21, 1998, p. 46).

Sea Star would provide 600 MMcfd of capacity from the South Pass Area and West Delta South Addition on the Outer Continental Shelf to proposed onshore gas processing facilities at Grand Isle (see map). Sea Star is backed by Columbia Gulf Transmission Co., which, in a related move, also plans to expand its onshore East Lateral system in southeastern Louisiana. Columbia this month launched open seasons simultaneously for both the onshore and offshore projects.

Koch's project calls for laying about 5 miles of 20-in. lateral line to connect existing capacity on its 36-in. Gulf Coast main line to the processing facilities near Grand Isle. This first phase would add 300 MMcfd of capacity with a minimum amount of capital outlay under Koch's blanket certificate limits. Phase I is expected to be in service when the new processing facilities are on line. Until then, Koch plans to offer competitive transportation from Venice or other options.

Under a second phase, Koch would increase capacity by a further 300 MMcfd by adding loop line and compression. This expansion to 600 MMcfd would be driven by market demand, Koch said.

Koch will offer shippers discounted rates to power plant, industrial, and pipeline interconnect (inter- and intrastate) markets from Grand Isle. Rates will be determined market by market and require a minimum 3-year term.

Venice project

The Venice interconnect planned by El Paso unit Tennessee Gas Pipeline Co. and Tejas unit Mississippi Canyon Gas Pipeline LLC will link deepwater producing regions tied to the Mississippi Canyon pipeline with the markets served by Tennessee Gas.

The project is expected to be in service by Apr. 1, 1999. Tennessee Gas plans to accept nominations at this new point for April 1999 gas flow.

Tennessee's binding open season for the new interconnect began Sept. 17 and was to end Sept. 25, with the successful bidders to be announced Sept. 28.