[Federal Register Volume 62, Number 61 (Monday, March 31, 1997)]
[Notices]
[Pages 15166-15167]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-8008]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission
[Docket Nos. CP97-300-000, CP97-301-000, and CP97-302-000]


Dauphin Island Gathering Partners; Notice of Application

March 25, 1997.
    Take notice that on March 21, 1997, Dauphin Island Gathering 
Partners (Dauphin Island), c/o OEDC, Inc. 1400 Woodloch Forest Drive, 
Suite 200, The Woodlands, Texas 77380, filed in Docket Nos. CP97-300-
000 an application, pursuant to Section 7(c) of the Natural Gas Act and 
Section 157 of the Commission's Regulations, for a certificate of 
public convenience and necessity to (1) construct and operate an 
offshore 24-inch, 63-mile natural gas pipeline and related facilities 
extending from the existing Dauphin Island gathering system at Alabama 
State Tract 73 to Main Pass Gas Gathering System at Main Pass Block 225 
and (2) to operate as a jurisdictional facility on a temporary basis, 
with pregranted abandonment, an existing pipeline facility required to 
transport the gas onshore. Dauphin Island also filed in Docket No. 
CP97-301-000 for blanket authority pursuant to Part 284 of the 
Commission's Regulations to transport gas on an open-access basis and 
for approval of its pro forma tariff, including the proposal to charge 
negotiated rates. Also, Dauphin Island also requests in Docket No. 
CP97-302-000 a blanket certificate pursuant to Section 157, Subpart F 
of the Commission's Regulations to engage in certain routine 
activities. Finally, Dauphin Island requests that the Commission 
confirm that issuance of the requested authorizations and services will 
not subject the existing facilities of Dauphin Island to the 
Commission's jurisdiction,\1\ all as more fully set forth in the 
applications, which are on file with the Commission and open for public 
inspection.
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    \1\ Dauphin Island previously filed in Docket No. CP97-119-000 a 
petition seeking that the Commission declare that its proposed 
facilities are gathering facilities exempt from Commission 
jurisdiction pursuant to Section 1(b) of the Natural Gas Act. 
Dauphin Island seeks the requested authorization only if the 
Commission finds that any of the requested facilities are subject to 
the Commission's jurisdiction.
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    Dauphin Island indicates that the maximum capacity of the proposed 
facilities will be 200,000 dt equivalent on natural gas per day. It is 
noted that the proposed facilities will parallel the western leg of the 
existing Dauphin Island gathering system for approximately 30 miles. It 
is stated that the proposed facilities will gather gas along its length 
from production already discovered but not currently developed and from 
exploratory efforts in the area. Dauphin Island notes that the 
facilities are designed to gather gas that currently cannot be produced 
due to capacity constraints downstream of the Main Pass system and 
significant newly discovered production which can be attached to the 
Main Pass system. Dauphin Island states that it intends to construct in 
the future a second phase of the project, which would include 13 miles 
of 24-inch pipeline extending from the northern terminus of the 
proposed facilities onshore. It is indicated that Dauphin Island is not 
applying for authority to construct and operate the facilities at this 
time, but intends to file within the next 12 months when it has 
sufficient time to complete the requisite environmental studies, 
obtained commitments from producers in the area, and arranged to 
purchase pipe.
    Because Dauphin Island is not ready to build the second phase of 
its project, Dauphin Island requests a limited term certificate with 
pregranted abandonment to use a portion of its existing gathering 
system which extends downstream from Alabama State Tract 73 for 
interstate transmission of up to 200,000 dt equivalent of natural gas 
per day to onshore interconnections for a period of up to twelve months 
after the proposed facilities are placed in service.
    Dauphin Island estimates a construction cost of the proposed 
facilities of $54,116,620, which would be financed from cash on hand 
from the various partners of Dauphin Island.
    Dauphin Island requests that it be issued a blanket certificate 
pursuant to Section 284.221 of the Commission's Regulations. Dauphin 
Island proposes to provide transportation service under three firm rate 
schedules, including (1) FT-1 firm service, (2) FT-2 firm service 
available to shippers who commit all of the gas from specified OCS or 
state blocks and (3) FT-3 firm service representing overflow volumes 
from the Main Pass System, and IT-1 interruptible service.
    Dauphin Island requests authorization to permit it to charge 
negotiated rates. It is indicated that in the Statement of Policy on 
Alternatives to Traditional Cost-of-Service Ratemaking for Natural Gas 
Pipelines, 74 FERC para. 61,076 (1996), the Commission stated that 
negotiated rates would be approved in certain circumstances, and that 
Dauphin Island meets those circumstances. Dauphin Island states in its 
tariff the charges

[[Page 15167]]

applicable to negotiated rates under Rate Schedules FT-2 and FT-3, and 
that capacity would be available at a cost-based recourse rate under 
Rate Schedules FT-1 and IT-1. It is indicated that for rates negotiated 
with customers following Commission authorization to charge such rates, 
Dauphin Island will file conforming tariff sheets indicating that the 
rate for the service will be either the rates stated on its existing 
rate schedule or a rate mutually agreed upon by the pipeline and 
customer. It is also indicated that, when a rate is negotiated, Dauphin 
Island will file a numbered tariff sheet stating the exact legal name 
of the customer and the negotiated rate for the service. It is stated 
that permitting Dauphin Island to negotiate rates with customers at 
mutually agreed levels will promote competition, and permit them to 
tailor contracts to meet the specific needs of each shipper.
    It is stated that the tariff filed by Dauphin Island is 
substantially similar to those recently approved by the Commission in 
Garden Banks Gas Pipeline, L.L.C., Docket No. CP96-307-000 and Shell 
Gas Pipeline Company, Docket No. CP96-159-000, except for service under 
Rate Schedule FT-3, and except for the following differences: in the 
Dauphin Island tariff, service is provided on a dekatherm rather than 
volumetric basis; the Dauphin Island tariff includes an overrun 
service; secondary receipt points are not available to shippers under 
Dauphin Island Rate Schedules FT-2 and FT-3; in Dauphin Island's 
tariff, all delivery points are available to all shippers based upon 
confirmation by the downstream pipeline; a charge of $3.50 per barrel 
will be charged by Dauphin Island for recovery of liquid hydrocarbons; 
at the request of the shipper, Dauphin Island may enter into contracts 
for various services with third parties and charge the cost to shipper 
as an ``Other Charge'' under the rate schedule; under Dauphin Island's 
tariff, a capacity release can be released only into Rate Schedule FT-
1; and Dauphin Island may process shipper's gas if the shipper does not 
process; additionally, the term: equivalent quantities'', some quality 
specifications, nomination procedures, the effect of force majeure on 
payment of reservation rates, and the resolution of monthly imbalances 
have been changed.
    Any person desiring to be heard or to make any protest with 
reference to said application should on or before April 4, 1997, file 
with the Federal Energy Regulatory Commission, Washington, D.C. 20426, 
a motion to intervene or a protest in accordance with the requirements 
of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 
385.211) and the Regulations under the Natural Gas Act (18 CFR 157.10). 
All protests filed with the Commission will be considered by it in 
determining the appropriate action to be taken but will not serve to 
make the protestants parties to the proceeding. Any person wishing to 
become a party to a proceeding or to participate as a party in any 
hearing therein must file a motion to intervene in accordance with the 
Commission's Rules.
    Take further notice that, pursuant to the authority contained in 
and subject to the jurisdiction conferred upon the Federal Energy 
Regulatory Commission by Sections 7 and 15 of the Natural Gas Act and 
the Commission's Rules of Practice and Procedure, a hearing will be 
held without further notice before the Commission or its designee on 
this application if no motion to intervene is filed within the time 
required herein, if the Commission on its own review of the matter 
finds that a grant of the certificate and permission and approval for 
the proposed abandonment are required by the public convenience and 
necessity. If a motion for leave to intervene is timely filed, or if 
the Commission on its own motion believes that a formal hearing is 
required, further notice of such hearing will be duly given.
    Under the procedure herein provided for, unless otherwise advised, 
it will be unnecessary for Dauphin Island to appear or be represented 
at the hearing.
Lois D. Cashell,
Secretary.
[FR Doc. 97-8008 Filed 3-28-97; 8:45 am]
BILLING CODE 6717-01-M