NEWS BULLETIN

September 02, 2011 --- Vol. 17, No. 75September 2011

Marathon files agreement with CEA on bidirectional CIGGS flow

Marathon Oil Co. has asked the Regulatory Commission of Alaska for approval of an agreement with Chugach Electric Association for the bidirectional flow of natural gas through the Cook Inlet Gas Gathering System, known as CIGGS, under the Cook Inlet. And in a parallel RCA filing Marathon has asked for approval of pipeline facility modifications on the Kenai Peninsula to enable the bidirectional flow to operate.

Currently CIGGS only carries gas west to east under the Cook Inlet from oil and gas fields on the west side of the inlet. However, faced with ever tightening gas deliverability during cold winter weather, Southcentral Alaska power and gas utilities have been anxious to enable bidirectional flow through CIGGS, to increase the flexibility of arrangements for flowing gas from wells to the places where the gas is needed.

Under the agreements filed with RCA, Chugach Electric will fund the CIGGS bidirectional flow project, including the required changes to the pipeline infrastructure, with the state providing a grant for the capital costs of the project. Chugach Electric is concerned about winter supplies of gas to its gas-fired Beluga power station on the west side of the inlet, and wants to be able to obtain gas directly delivered from the east side of the inlet, if necessary. The Beluga power station connects to CIGGS via the Marathon operated Beluga pipeline in August businesses involved in the Cook Inlet gas industry filed with RCA a tariff settlement for the Beluga line, which already accommodates bidirectional gas flow.

See full story in Sept. 11 issue, available online to subscribers at 11 a.m., Friday, Sept. 9, at www.PetroleumNews.com


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