Wednesday, November 25, 2009

Natural-gas storage facility to be built in Louisiana

HOUMA, La. - BCR Holdings, owned by a New-York based investment firm, is working to build a new $230 million natural-gas storage facility in Lafourche Parish.
BCR is developing a natural salt cavern just south of Larose to store the gas.
The facility, called Bully Camp Gas Storage, would provide a “first stop” for storage in what is already a hub for pipeline activity, said Tom Cook, executive vice president of development for the project.
“The producers of deepwater gas that comes in (only) have access to storage farther north,” Cook said.
Currently, the company is hosting an open season, or comment period, through Dec. 18 to gauge interest in natural-gas storage from local pipeline companies, Cook said.
BCR Holdings intends to file paperwork for the project with the Federal Energy Regulatory Commission by December, and state and local permitting would follow.
The facility would consist of a plant on 11.5 acres next to the Williams Discovery Gas & Pipeline processing plant in Larose, which filters and processes natural gas before sending it out into nearby pipelines. The potential storage site itself sits about 5.5 miles south of there on 1,700 acres of marshland property.
The two salt dome caverns will store about 15 billion cubic feet of gas, enough to power 220,000 homes for a year.
Construction is planned to start in about a year, and the facility would be operational by the end of 2013.

Tuesday, November 24, 2009

Williams completes Transco expansion in Northeast

TULSA, Okla. - Williams Cos. said on Nov. 19 that it has placed into service an expansion of its Transco natural gas pipeline, increasing firm transportation capacity into the Northeast United States by 102,000 dekatherms per day.
The expansion increases the total system capacity on the 10,500-mile Transco system to approximately 8.6 billion cubic feet per day, the company said in a statement.
The Sentinel expansion project was completed in two phases, the second of which was just placed into service. The first phase, which increased capacity by 40,000 dekatherms per day, was placed into service in December 2008.
Phase II construction included the addition or replacement of 14 miles of pipe and eight meter station modifications at various locations in Pennsylvania and New Jersey.

Monday, November 23, 2009

Williams seeks FERC approval for expanded Southeast Gas Service

TULSA, Okla. - Williams said on Nov. 18 that it has filed an application with the Federal Energy Regulatory Commission to expand its Transco natural gas pipeline to serve markets in the southeastern United States.
The company said that new service from the Mobile Bay South II Expansion project would be available in the spring of 2011, subject to FERC approval.
The project is designed to create an additional 380,000 dekatherms of southbound, year-round firm transportation capacity on the Mobile Bay Lateral from Transco’s mainline at Station 85 near Butler, Ala., to its interconnect with Gulfstream Natural Gas System in Coden, Ala.

Friday, November 20, 2009

Former Willbros consultant admits bribery plot

HOUSTON - A former Willbros International consultant pleaded guilty on Nov. 12 to two federal charges in the payment of more than $6 million in bribes to Nigerian officials in exchange for pipeline contracts.
Paul G. Novak, 43, pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act and one count of violating the act, which prohibits bribing officials for business overseas.
Novak was charged along with James Kenneth Tillery, a former executive of Willbros International, who is a fugitive. Two other Willbros employees, Jim Bob Brown and Jason Steph, have pleaded guilty for their roles in the scheme but have not yet been sentenced.

Thursday, November 19, 2009

Bush appointee resigns as U.S. coordinator for Alaska gas pipeline project

ANCHORAGE - Republican Drue Pearce, the federal official responsible for coordinating planning for the proposed Alaska natural gas pipeline, has resigned her position at the request of the Obama administration.
Pearce, a former Alaska state Senate president who has held the position since it was created by then President George W. Bush in 2006, said she will step down effective Jan. 3.
The Office of the Federal Coordinator for Alaska Natural Gas Transportation is reviewing competing plans offered by both TransCanada Corp. and a joint venture formed by BP and ConocoPhillips to build a pipeline to ship natural gas from Alaska's North Slope to domestic U.S. markets.
Pearce was the first person to hold the job, which is designed to keep federal agencies working together to get the pipeline built without undue delay. Some 22 federal agencies in the United States - plus others in Canada Thomas Barrett- must sign off on an environmental impact statement before the project can move forward.
Alaska Sen. Lisa Murkowski, who is the top Republican on the Senate Energy and Natural Resources Committee, said she was pleased that Pearce's deputy, retired U.S. Coast Guard Vice Adm. Thomas Barrett, will serve as the interim coordinator until the White House appoints someone new.

Wednesday, November 18, 2009

Kinder Morgan Energy Partners, Copano to build Eagle Ford gas pipeline

HOUSTON - Kinder Morgan Energy Partners and Copano Energy plan to form a joint venture to build a 22-mile natural-gas pipeline in the south Texas Eagle Ford Shale, the companies said on Nov. 13.
The project is expected to cost about $30 million, Kinder Morgan spokesman Joe Hollier said.
The 24-inch pipeline will have an initial capacity of 350 million cubic feet of gas a day, and will extend from LaSalle County to Duval County, Texas.
Kinder Morgan and Copano expect to complete the project in mid- 2010.
Kinder Morgan and Copano will provide gas gathering, transportation and processing services to Eagle Ford Shale producers through the 50-50 joint venture.

Tuesday, November 17, 2009

BP faces suit claiming Ocensa pipeline damaged Colombian farmland

LONDON - Ninety-five Colombian farmers are suing BP in the high court in London for allegedly causing serious damage to their land, crops and animals.
In the first case of its kind, the farmers are claiming that BP Exploration Co. Ltd., which joined forces with Colombia's national oil company and four foreign multinational corporations in a consortium to construct the 450-mile Ocensa pipeline, caused landslides and damage to soil and groundwater, causing crops to fail, livestock to perish, contaminating water supplies and making fish ponds unsustainable.
The farmers are claiming damages against BP for breach of contract and negligence.
If the court accepts the evidence, it could open the way for similar claims by other communities in developing countries who say they have been adversely affected by oil pipelines.

Monday, November 16, 2009

Final leg of Rockies Express natural gas pipeline placed in service

NEW YORK - Construction of the final 195 miles of the eastern portion of the Rockies Express natural gas pipeline was complete and service began on Nov. 12 into eastern Ohio, pipeline partner Kinder Morgan Energy Partners LP said.
Kinder Morgan owns 50 percent of the 1,679-mile line that stretches from northwestern Colorado to eastern Ohio. The entire REX pipeline, capable of delivering 1.8 billion cubic feet per day of gas, is now operational, the company said in a news release.
The final leg stretches from the Lebanon Hub in Warren County, Ohio, to Clarington, in Monroe County, Ohio.
Long-term, binding commitments had been secured for virtually all of the pipeline's capacity, the company said.
REX, one of the largest natural gas pipelines constructed in North America, is operated by Kinder Morgan. Sempra unit Sempra Pipelines and Storage and ConocoPhillips each own a 25 percent stake in REX.

Friday, November 13, 2009

6°C rise in temperature predicted by 2030: irreparable harm to planet

According to the International Energy Agency, the recovery from the current recession could spark a massive energy crisis with increased demand for fossil fuels from China and other developing countries, tighter oil supplies and skyrocketing oil prices.
The longer-term picture looks even more challenging. If the world continues to guzzle oil and gas at its present pace, global temperatures will rise by an average of 6°C by 2030, causing "irreparable damage to the planet."
The agency's annual World Economic Outlook report was released on Nov. 10.
The warning from the IEA, an intergovernmental energy watchdog based in Paris, could add extra weight to the negotiations leading up to the climate-change summit in Copenhagen next month, when leaders will attempt to come to an agreement on a successor to the Kyoto Protocol's limits on greenhouse-gas emissions.
The IEA report says the world faces a looming disaster if its leaders drag their feet in Copenhagen. Among the predictions likely to alarm the big energy consumers:
• Unless there is an "energy revolution," the planet will heat up by about 6°C by 2030 - about three times the rate of global warming that is considered manageable by most scientists. That, says the normally sober IEA, "would lead almost certainly to massive climatic change and irreparable damage to the planet."
• The global recession has brought the first significant yearly drop in energy demand since 1981, giving the planet a rare breather from carbon emissions. But this is a "unique" moment, the report says, whose gains will be quickly obliterated without a significant move toward alternative energies. The impending energy crisis is "far greater than many people realize," it says.
• Energy demand will rebound sharply once the recession ends and rise about 40 percent by 2030. Fossil fuels - oil, coal and gas - will make up about three-quarters of the global increase in energy consumption.
• Coal usage will grow annually about 2.5 percent from now to 2030, which could lead to massive increases in air pollution.
• Without the energy revolution that the IEA says is necessary, oil prices will rise by 2020 to about $100 a bbl. in pre-2008 dollar values and by 2030 to about $115 a bbl.
To avoid all this, the IEA says the world needs to spend about $10.5 trillion in extra money from 2010 to 2030 to foster new low-carbon energy sources.

Thursday, November 12, 2009

South Dakota landowners along Keystone XL want bonds as protection

PIERRE - Some landowners want the state Public Utilities Commission to require TransCanada to post additional bonds for the company’s proposed XL oil pipeline in western South Dakota.
The bonds would serve as financial protection against damages from oil spills and for removal of the XL pipeline if the company abandons it in the future.
Paul Seamans of rural Draper and David Niemi of rural Buffalo were among those who called for the bonding during a public-input meeting Nov. 3 held by the PUC as part of a permit hearing.
Seamans, Niemi and others also called for limits on the time which TransCanada can hold the easement.
State law doesn’t require spill and abandonment bonds for pipelines. But bonds are required for surface mines in South Dakota.
The PUC is considering a $15.6 million road-damage bond as a permit condition for the XL project. TransCanada posted a $12 million bond for roads, as a condition of the PUC permit for its Keystone pipeline being built down the James River Valley.
PUC lawyer Kara Semmler said counties and TransCanada have been working out road issues associated with the Keystone construction. She said there have been no claims so far against the $12 million. “It is intact,” she said.

Wednesday, November 11, 2009

Hurricane update: Ida dissipates, energy production in GoMex returns to normal

Hurricane Ida, its winds deteriorated to 40 mph as it came ashore near Mobile, Ala., on the morning of Nov. 10, was downgraded to Tropical Depression Ida.
The National Hurricane Center further reduced it to “extratropical” status as its remnants crossed Florida, Alabama and Georgia later on Nov. 10.
The storm prompted U.S. energy companies to close down 43.1 percent of oil output and 28.0 percent of natural gas production in the Gulf of Mexico. Employees from eight drilling rigs and 126 production platforms were evacuated as the storm passes through the area, the U.S. Minerals Management Service said.
Energy sources predicted that oil industry operations that had been shut down ahead of the storm would return to normal by the end of Nov. 10 or early
On Nov. 11.
The Gulf is the source of 25 percent of U.S. domestically produced oil and 15 percent of natural gas. About 40 percent of U.S. refining capacity is located on the Gulf Coast.
Oil refineries will not likely need to request crude from the Strategic Petroleum Reserve as they prepare for the potential effects of Tropical Storm Ida on the country's stockpile, the Energy Department said. Refineries were "holding above average stock levels, and refinery utilization is average or less than average," the agency said. The department is capable of supplying crude but said it thinks that it will not be necessary.
Chevron Corp. said on Nov. 10 that it was assessing facilities in the Gulf of Mexico affected by Tropical Storm Ida and returning workers to offshore platforms. The company will continue "safe remobilization efforts throughout the week," Chevron said in a news release.

Tuesday, November 10, 2009

NTSB report on fatal Dixie Pipeline rupture in 2007 now online

The final report of the National TransportationSafety Board on the Dixie Pipeline rupture and fire in Mississippi in 2007 is now available online at and
Following is the executive summary of the report:
“On November 1, 2007, at 10:35:02 a.m. central daylight time, a 12-inch-diameter pipeline segment operated by Dixie Pipeline Company was transporting liquid propane at about 1,405 pounds per square inch, gauge, when it ruptured in a rural area near Carmichael, Mississippi. The resulting gas cloud expanded over nearby homes and ignited, creating a large fireball that was heard and seen from miles away. About 10,253 barrels (430,626 gallons) of propane were released. “As a result of the ensuing fire, two people were killed and seven people sustained minor injuries. Four houses were destroyed, and several others were damaged. About 71.4 acres of grassland and woodland were burned. Dixie Pipeline Company reported that property damages resulting from the accident, including the loss of product, were $3,377,247.
“The National Transportation Safety Board determines that the probable cause of the November 1, 2007, rupture of the liquid propane pipeline operated by Dixie Pipeline Company near Carmichael, Mississippi, was the failure of a weld that caused the pipe to fracture along the longitudinal seam weld, a portion of the upstream girth weld, and portions of the adjacent pipe joints.
"The following safety issues were identified as a result of the investigation of this accident:
• The failure mechanisms and safety of low-frequency electric resistance welded pipe,
• The adequacy of Dixie Pipeline Company’s public education program,
• The adequacy of federal pipeline safety regulations and oversight exercised by the Pipeline and Hazardous Materials Safety Administration of pipeline operators’ public education and emergency responder outreach programs, and
• Emergency communications in Clarke County, Mississippi.

Monday, November 9, 2009

Gas pipeline explosion in Texas injures three, melts window blinds

AMARILLO, Texas - A natural gas pipeline explosion shook the town of Bushland on Nov. 5. The ensuing fire was so intense that it launched flames hundreds of feet into the sky and melted the window blinds of nearby homes.
One nearby home was completely destroyed, while surrounding houses sustained damages.
A total of 60 people were evacuated to Bushland Middle School.
Witnesses reported seeing flames from their homes that reached hundreds of feet into the air. Even people as far as 20 miles away reported witnessing the fire from their homes.
Three people were injured in the blast, according to officials. The victims reportedly sustained burns and were transported to the Northwest Texas Hospital in Amarillo for treatment by doctors and nurses. Police officials have not released the identities of the victims. It has not been determined what caused the explosion.
El Paso Natural Gas and Atmos Energy crews are conducting an investigation.

Friday, November 6, 2009

MasTec to acquire Precision Pipeline, LLC

CORAL GABLES, Fla. - MasTec, Inc. on Nov. 3 announced that it has signed a definitive agreement to acquire Precision Pipeline, LLC, a leading natural gas, crude oil and refined products transmission pipeline infrastructure services provider in North America for a purchase consideration of $150 million.
The transaction is contingent on financing availability on terms and conditions acceptable to MasTec, in its sole discretion, and there is no break-up fee if such financing is not available.
Based in Eau Claire, Wis., Precision specializes in the construction and maintenance of large-diameter pipelines. Precision's experience in the long-haul, interstate pipeline industry will complement MasTec's existing energy infrastructure service offerings, which include natural gas gathering systems, processing plants and compression stations and mid-stream pipelines.
Precision employs a team of skilled unionized workers and tradesmen which it deploys throughout North America and utilizes a significant pool of specialized
pipeline construction equipment.
With the acquisition of Precision, MasTec will become one of the leading pipeline contractors in the country, capable of providing a full array of construction services to oil and gas producers, as well as mid-stream and interstate pipeline operators.

Thursday, November 5, 2009

Ultra Resources proposes condensate pipeline in Wyoming

GREEN RIVER, Wyo. - A Houston-based energy company is proposing to construct a 42-mile pipeline to move condensate out of the Pinedale Anticline natural-gas field to a terminal located south of LaBarge, according to Bureau of Land Management officials.
The move is expected to reduce truck traffic in the lucrative Sublette County gas field, which should help reduce potentially dangerous ozone-causing air pollutants and reduce effects on wildlife.
BLM spokeswoman Lorraine Keith said Ultra Resources Inc. proposed building the 6-inch pipeline to fulfill a requirement in the agency's supplemental environmental impact statement record of decision.
The document mandated that field operators install a liquids-gathering system to reduce truck traffic associated with production in the Anticline within two years.
State and federal officials have been working with oil and gas operators in recent years to take steps to reduce pollution from field equipment, condensers and other facilities in an effort to reduce ground-level ozone concentrations in the region.

Wednesday, November 4, 2009

DOT proposes $466,200 fine for Enterprise in Kansas pipeline failure

WASHINGTON - The U.S. Department of Transportation on Oct. 28 proposed to fine Enterprise Products Operating, LLC $466,200 for alleged violations of federal pipeline safety regulations. The proposed fine follows the
Department's investigation into the Enterprise Products Partners September
2007 failure near Englewood, Kansas.
"Today's action reinforces a message the Department has communicated for years to owners and operators of pipeline systems and other freight and commodity transporters - Safety First," said Transportation Secretary Ray LaHood.
The proposed fine and finding of probable violation are the result of an accident investigation recently completed by the Department's Pipeline and Hazardous Materials Safety Administration (PHMSA). During the investigation, PHMSA investigators discovered possible failures by Enterprise to ensure pipeline workers were adequately trained to perform necessary system repairs as required by federal operator qualification regulations. Proper implementation of operator qualification programs by pipeline companies is vital to preventing system failures, injury to people, property damage, and other serious consequences. Other probable violations include failures to conduct required drug testing of maintenance personnel following the accident.
On Sept. 11, 2007, PHMSA inspectors responded to an Enterprise Products pipeline rupture and release of approximately 14,700 barrels of natural gas liquid. Post-accident failure analysis determined the failure was due to the improper installation of pipeline system components following recently conducted maintenance activities.
Although the release did not result in any deaths or injuries to the public, the event closed State Highway 283 for five days, seriously affecting daily commuters as crews worked to secure and clean-up spilled product.

Tuesday, November 3, 2009

Fatality count rises to 10 in India Oil terminal fire

JAIPUR - The massive fire at an oil depot in western India has left 10 people dead, an official said on Nov. 1, as the blaze raged on after more than 48 hours.
The fire, caused by a suspected oil pipeline leak, broke out on the night of Oct. 29 at the Indian Oil Corp (IOC) compound on the outskirts of Jaipur in the desert state of Rajasthan.
B.L. Soni, a senior Jaipur police official, told the AFP news agency that two bodies had been spotted near the facility but that rescuers could not retrieve them because the temperature from the fire was too high.
He said authorities believe the bodies belong to two IOC employees who have been missing since the inferno began.
Eight other people died in the blaze, including three employees. Their bodies were recovered at the scene, officials said.
The number of injured stood at 135.

Monday, November 2, 2009

Duncan, Enterprise Partners expanding Louisiana intrastate system

HOUSTON - Enterprise Products Partners and Duncan Energy Partners have announced plans to expand their Louisiana intrastate natural gas pipeline system.
The system, operated by Acadian Gas LLC, a joint venture of the Partners, is being extended into northwest Louisiana to bring gas from Haynesville Shale deposits to regional customers.
The Haynesville Extension will have a design capacity to deliver 1.4 billion cubic feet per day through a 249-mile pipeline connecting existing infrastructure to the affiliated Cypress gas pipeline. The expansion will provide producers in the Haynesville shale access to nine interstate pipelines - Florida Gas, Texas Eastern, Transco, Sonat, Columbia Gulf, Trunkline, ANR, Tennessee Gas.
Enterprise says the extension provides natural gas shippers advantages in terms of price while diversifying the gas sector in the south Louisiana market. For producers, the company said, the extension offers more options for transactions with their end users.
"The expansion of the Acadian system provides our partnership with another major foothold in a significant non-conventional natural gas producing area," said Michael A. Creel, president and chief executive officer of Enterprise.
The service date for the expansion is September 2011.
The Haynesville Extension will be able to transport 1.4 bcfd through 249 miles of 36-in. and 30-in. OD pipeline connecting to both Acadian’s system and its affiliated Cypress Gas Pipeline.