California PUC Approves Plans To Bring Rockies Gas To California

The California Public Utilities Commission has approved plans by PG&E Corp.’s Pacific Gas & Electric unit to bring Rockies natural gas to California on the $3 billion Ruby Pipeline planned by El Paso Corp.
  The 670-mile, 42-inch-diameter Ruby pipeline will run from the Opal hub in Wyoming to the Malin, OR,  hub near the California-Oregon border. The Ruby line would connect with the PG&E natural gas pipeline system at Malin.
  The 15-year agreement calls for PG&E, as anchor shipper, to get 375 MMcf/d of the Ruby’s capacity to deliver 1.3 to 1.5 Bcf/d at Malin. The commission also let the utility recover its costs from retail customers to ship gas on Ruby, as well as its Redwood Path line.
  The 15-year pact starts in 2011 or when the proposed Ruby line is ready for operation.
  El Paso spokesman Bruce Connery said Ruby’s construction is not expected to be affected by the current credit crunch because construction is to begin in 2010, when, El Paso hopes availability to credit is not as tight.
  “Ultimately, the natural gas pipelines, because they have long-term commitments from shippers, tend to be very attractive from the financing standpoint,” Connery said.
  El Paso planned to file this month for Federal Energy Regulatory Commission permitting for the Ruby line.
  In approving PG&E’s agreement with El Paso, and Ruby Pipeline LLC, the California PUC dismissed an alternate proposal for PG&E to get supply from another proposed project, the Sunstone Pipeline backed by Williams Companies Inc. and TransCanada Corp. and its Gas Transmission Northwest Corp. (GTN).
  The Sunstone line would be 230 miles longer than the Ruby line and would also bring gas from the Opal hub in Wyoming.