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Chevron, Total take gas pipeline capacity
Allen Baker
Chevron USA and a subsidiary of Total have agreed to take all the capacity of a pipeline system being built to serve Cheniere’s Sabine Pass LNG terminal in Louisiana. The two companies signed a contract with Kinder Morgan Energy Partners L.P. to move up to 3.2 billion cubic feet of gas daily from the terminal into the natural gas grid for 20 years starting in 2009. The deal was announced Nov. 7.
Two pipelines are involved in the $490 million project. A short one-mile spur will take up to 1.2 bcf daily from the terminal to a nearby line operated by a Kinder Morgan subsidiary, Natural Gas Pipeline Company of America. Work began in March In addition, Kinder Morgan will build a 137-mile line that will take 2 bcf daily into the heart of the Louisiana spider web of gas pipelines, giving the companies access to move their gas into 11 pipelines that serve the Eastern U.S.
Chevron and Total Gas & Power North America Inc. will each have half of the capacity on each line. The capacity was awarded in a recent open season for the system.
Cheniere Inc. began work on Sabine Pass in March. The eye of Hurricane Rita passed just a few miles east of the site, but the company said there was little damage and that it didn’t expect the storms to cause a significant delay in the completion of the terminal. Sabine Pass is expected to open in 2008 with 2.6 bcf daily of initial sendout capacity.
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