NiSource Gas Transmission & Storage’s (NGT&S) Columbia Gas Transmission (Columbia) reached a customer settlement that provides for Columbia to modernize its natural gas pipeline infrastructure under a program that will initially span the next five years, with provisions for potential extensions thereafter.
The settlement filed last month with the Federal Energy Regulatory Commission (FERC) includes a base rate reduction for customers and an investment recovery agreement. Columbia has asked that the settlement be approved prior to the end of 2012.
“Heeding the President’s Executive Order and efforts by the Department of Transportation, we have developed a comprehensive and long-term infrastructure investment plan that ensures safe and reliable transportation of natural gas for decades to come,” said Jimmy Staton, NGT&S CEO.
“We’ve worked with our customers over the last several months to develop a mechanism for cost recovery associated with these investments. This collaboration put into place a year-by-year infrastructure investment strategy, while providing customers with predictable, affordable rates.”
Columbia projects that its entire modernization program could reach $4 billion over an extended period. Under the settlement, Columbia will invest $300 million per year on system improvements, which include:
* Replacing Aging Infrastructure – replacing approximately 1,000 miles of existing interstate transmission pipelines, primarily bare steel (400 miles in the first five years);
* Upgrading Natural Gas Compression Systems – replacing and modernizing more than 50 critical compressor units along the pipeline system that will enhance system efficiency and improve environmental performance;
* Increasing Pipeline System Reliability – uprating pressures and looping systems where needed to ensure gas is reliably delivered to critical markets; and
* Expanding Inline Inspection Capabilities – facilitating Columbia’s ability to perform state-of-the-art maintenance and inspections without interrupting services
Infrastructure investment work will take place across Columbia’s footprint, including Kentucky, Maryland, Ohio, Pennsylvania, Virginia and West Virginia.
“In addition to improving the pipeline system and increasing customer reliability, our modernization program also will be a catalyst for the economy — spurring job creation and supporting economic opportunity in many of the communities where we operate,” added Staton. “We estimate more than 7,000 direct jobs will be created as a result of the program.”