Columbia slates gas pipeline to Northeast U.S.

• Columbia's Northeast U.S. Pipeline Project [104838 bytes]

The 36-in. Millennium pipeline would be completed in time to deliver gas for the 1999 winter heating season. It would compete with several other new projects proposed to move gas to the Northeast.

Columbia will operate and own 40% of the line. The remaining ownership will be divided among units of CMS Energy Corp., Dearborn, Mich.; MCN Energy Group, Detroit; and Westcoast Energy Inc., Vancouver, B.C.

Columbia will accept requests for service on the pipeline during a 45-day open season beginning in late April. This summer it will seek Federal Energy Regulatory Commission approval of the project.

Columbia officials said the pipeline's 50¢ tariff would offer shippers rates lower than other transmission alternatives, the pipeline would have a simplified nomination process, and it would offer access to a full range of flexible transportation and storage services.

They said Millennium Pipeline's connections with the Great Lakes and TransCanada pipeline systems would provide the most cost-effective and direct route available for moving western Canadian supplies to the Northeast.

They also said the pipeline would provide a competitive outlet for gas in the Chicago market to move east through the systems of CMS Energy Corp., Westcoast-owned Union Gas Ltd., and MCN Energy.

Columbia said Millennium would have access to significant storage in Michigan and southern Ontario, enabling it to offer tailored service options to electricity generator, industrial, and local distribution company customers.

The pipeline would originate at a new TransCanada delivery point at Lake Erie and follow existing Columbia Gas Transmission pipeline rights-of-way to a terminus in Westchester County, N.Y.

Columbia said 85% of the route is along its rights-of-way, with 10 interconnects with other Columbia lines. The line could be expanded to 950 MMcfd with addition of compressor stations.

Marketing deal

Separately, Columbia's energy marketing company, Columbia Energy Services, will buy and market Kerr-McGee Corp.'s 250 MMcfd of offshore gas production.

The deal will take effect May 1 and continue for 3 years.

J. Gil Walker, Kerr-McGee's general manager of oil and gas trading, said, "This long term agreement will permit Kerr-McGee to concentrate on its core business of exploring and producing natural gas and oil."

CES will manage all of Kerr-McGee's U.S. gas marketing activities, including scheduling, nominating, and balancing pipeline transportation and providing financial risk management services.