PGT-PG&E PROJECT EXPECTS GO-AHEAD SOON

Sponsors of a big U.S. West Coast gas pipeline construction project expect final regulatory approval by the end of this month or early in July.

Pacific Gas Transmission Co.-Pacific Gas & Electric Co.'s $1.5 billion, 844 mile, 42 and 36 in. expansion of the PGT-PG&E system from Canada to California could begin construction as early as September.

That work will include one of the world's largest, longest bored river crossings.

CERTIFICATION, FINANCING

Paula G. Rosput, PGT senior vice-president in charge of regulatory affairs, told a press briefing in Houston the anticipated timing of the final certification is based on the end of the comment period for the project's environmental impact statement filed in May with the Federal Energy Regulatory Commission. "Notification could come as early as June 26, " she said.

In January, the expansion project received preliminary FERC approvals on nonenvironmental matters.

In California, Rosput said, the Public Utilities Commission (CPUC) certified the project in December 1990 (OGJ, Jan. 7, p. 25) but issued minor changes this month. "Court appeals are likely," she said.

Interim financing for the project is to be in place by July 18. The cost will be divided $809 million on the PGT portion and $693 million on the PG&E portion.

Negotiations for permanent, long term financing are under way, mainly among three groups of undisclosed lenders, and should be com-plete by early fall.

The financed portion of the cost could go as high as $1.2 billion.

By June, PGT-PG&E had committed $70 million, and spending on the project will reach $500,000/day by July.

PGT-PG&E will own 70% of the expansion. Southern California Edison Co. and San Diego Gas & Electric Co. have been offered options to become equity partners for the remaining 30%.

THE DETAILS

Capacity will be expanded by 148 MMcfd to the Pacific Northwest and 755 MMcfd to California (OGJ, May 20, p. 19). As of last month, shippers were divided among marketers and brokers, end users, and producers.

Full construction is set to start in January 1992, said John A. Bianucci, PGT-PG&E assistant project manager for engineering and construction. Completion and start-u are scheduled for November 1993.

The expansion will include:

724 miles of 42 in. pipeline from the British Columbia-idaho border through Idaho, Washington, Oregon, and California to the Bay Area's proposed Bethany station.
120 miles of 36 in. pipeline from the Bay Area to Panoche station in Fresno County, where gas will enter the existing transmission systems of PG&E and Southern California Gas Co. for transport to end use customers.

Last February, Bechtel Corp. was named overall project manager with major subcontracting to Gulf Interstate Engineering and Fish Engineering.

As much as 30% of detailed engineering on the project is complete. All engineering work will be complete by third quarter 1992, Bianucci said.

Gulf Interstate is engineering all the pipeline work on the PGT and PG&E systems. Gulf Interstate also is responsible for engineering design of compressor and metering station work on the PGT system.

Fish Engineering is providing work on PG&E compressor stations, including the new one at Bethany, Calif., near San Francisco.

Orders for all compressor equipment went out in April. About $400 million in pipe orders for 400,000 tons of mainline pipe had been placed earlier (OGJ, Jan. 7, p. 25).

To date, said Barnucci, about 85% of all orders for materials, including major pipeline fittings and valves, have been placed. The first pipe for the project is to roll out of the mills Aug. 15.

Construction packages will be mailed by July 9, with contracts being awarded by December, he said. The project will use nine spreads of about 100 miles each-five spreads in 1992 and four in 1993.

Although construction will officially start in January 1992, major work is expected in September in San Francisco's Bay Area delta.

There, major bored crossings of three waterways will take place, including what Barnucci said will be the longest, largest in the world: a 42 in., 4,500 ft boring under the Sacramento River.

Bids for those crossings will be awarded by the end of this month.