The Federal Energy Regulatory Commission on Jan. 29 released for comment, which will be taken until Feb. 28, an environmental assessment (EA) for the Coastal Bend Header Project proposed by Gulf South Pipeline Co. LP.
Gulf South in June 2015 requested authorization to construct and operate certain natural gas pipeline facilities in various counties in Texas to expand the capacity of its pipeline system to 1.42 billion cubic feet per day to provide firm transportation service to the Freeport LNG Development LP terminal located on Quintana Island near Freeport, Texas.
The proposed Project includes the following facilities in Texas:
- install approximately 66-miles of new 36-inch-diameter pipeline lateral from Wharton County, Texas, to the existing Freeport Liquefied Natural Gas Stratton Ridge meter site in Brazoria County;
- construct one new gas-fired 83,597 horsepower (hp) Wilson Compressor Station in Wharton County;
- construct one new electric motor-driven 26,400-hp Brazos Compressor Station in Fort Bend County;
- construct one new electric motor-driven 10,700-hp North Houston Compressor Station in Harris County;
- install piping modifications at the existing Goodrich Compressor Station in Polk County to allow for bi-directional flow; and
- install additional gas-fired 15,748-hp compressor unit and modifications at the former Magasco Compressor Station in Sabine County to allow for bi-directional flow.
The new header pipeline would commence at a new interconnect with Tennessee Gas Pipeline Co. LLC northwest of Hungerford in Wharton County and would terminate in Brazoria County at the existing Freeport LNG Stratton Ridge meter site near Clute, for delivery to the Freeport LNG terminal.
All of the proposed facilities would be owned and operated by Gulf South. Gulf South plans to start construction (subject to commission approval) in the fourth quarter of 2016 at the compressor stations and the first quarter of 2017 for the pipeline, with a projected in-service date of April 2018. Gulf South estimates the cost of the Coastal Bend Header Project to be about $690 million.
Gulf South currently owns and operates approximately 7,240 miles of pipeline facilities extending from south and east Texas through Louisiana, Mississippi, southern Alabama, and western Florida. Gulf South has numerous interconnects with other interstate and intrastate pipelines and storage facilities, which allow it to serve various on-system and off-system markets.
Four companies – BP Energy Co., Chubu US Gas Trading LLC, Osaka Gas Trading & Export LLC and E.ON Global Commodities North America LLC (called the “Foundation Shippers”) – were the sponsors of a highly competitive bidding process through which proposals were solicited from multiple pipeline companies, both interstate and intrastate, for the development and construction of facilities to provide natural gas pipeline service to Freeport LNG and to establish negotiated transportation rates for firm natural gas service to Freeport LNG. Gulf South’s preliminary discussions with the Foundation Shippers began in April 2013. Ten initial contenders participated in these discussions. The Foundation Shippers initiated a competitive bidding process in September of 2013 in which the shippers outlined critical elements in their request.
At the conclusion of 16-month process on June 2, 2014, Gulf South was selected by the Foundation Shippers as the successful pipeline company. Subsequently, precedent agreements were executed with the Foundation Shippers for 1.42 billion cubic feet per day of firm transportation capacity on the Coastal Bend Header and 1.4 Bcf/d of transportation capacity on the Legacy System.
The four Foundation Shippers executed binding precedent agreements obligating them to enter into firm transportation agreements for 1.4 Bcf/d of capacity on the Legacy System and 1.42 Bcf/d of capacity on the Coastal Bend Header with a minimum term of twenty years. The precedent agreements for firm transportation on the Coastal Bend Header include the specific terms of the firm transportation services to be provided by Gulf South.