Natural Gas Pipeline in the Works

Staff | September 28, 2010

Houston, TX— A Texas-based pipeline company has announced plans to build a pipeline capable of carrying more than 1 billion cubic feet per day of natural gas from southwestern Wyoming to a pipeline interconnect at Malin, OR, near the California border. The pipeline is meant to serve the California natural gas market, according to published reports.

El Paso Corp., which is based in Houston, said the 670-mile Ruby Pipeline will cost $3 billion. The company said its subsidiary, Ruby Pipeline LLC, has signed 10- to 15-year binding contracts with customers who want to ship Rocky Mountain natural gas on the pipeline. Pipeline construction is subject to regulatory approvals.

The 42-inch-diameter pipeline will have an initial design capacity of between 1.3 billion cubic feet and 1.5 billion cubic feet per day, depending on the final level of customer commitments, and if approved will be in service by March 2011. El Paso said it is seeking additional shipping contracts for the Ruby Pipeline and plans to file a certificate application with the Federal Energy Regulatory Commission in January 2009.

El Paso said it has taken two significant steps to manage project costs in the face of skyrocketing prices for commodities. First, the company said it has signed purchase contracts with two steel mills for all of the pipe required for the project. Also, it has executed incentive-based contracts with a consortium of three construction companies, El Paso announced.