El Paso proceeding with offshore gas line from Nova Scotia to US

By the OGJ Online Staff

HOUSTON, Oct. 2, 2001 – El Paso Corp. said Tuesday it plans to build a $1.6 billion sub-sea pipeline to move gas from fields off Nova Scotia to markets in Canada and the northeastern US.

El Paso said it is pursuing this project as a result of increased drilling activity near Sable Island and the completion of a feasibility study (OGJ Online, May 4, 2001).

Named the Blue Atlantic Transmission System, the proposed project would consist of 750 miles of 36-in. pipe and would carry up to 1 bcfd. The line will be laid sub-sea from the anticipated production area to a terminal on the southern coast of Nova Scotia, then continue sub-sea to landing points in the New York and New Jersey areas.

E. Jay Holm, CEO of the El Paso Eastern Pipeline Group, said, “We are confident in developing an effective engineering and environmental plan that will address all appropriate issues. The sub-sea configuration offers several advantages over a land-based alternative, including minimal environmental impact, significant reduction in community disturbances, and anticipated transportation rates substantially less than $1/decatherm for firm deliveries to the New York and New Jersey markets, as well as reduced rates for deliveries to the province of Nova Scotia. The anticipated rates are significantly less than that of any known current or proposed alternative project to provide firm transportation to these regions.”

El Paso said Blue Atlantic will provide substantial economic benefits to Nova Scotia by creating the first access to natural gas in the province’s southwestern region and addressing the continued increasing demand for natural gas on the US East Coast.

It said, “Demand for natural gas in this region is expected to increase an additional 685 MMcfd by 2005, growing to an incremental 2 bcfd by the end of the decade.”

El Paso will open an office in Halifax and has retained a local firm for environmental studies. It is evaluating bids from several firms to provide project management services. It plans to hold an open season before yearend to determine capacity demands.

When the pipeline route has been determined and environmental work is completed, Blue Atlantic apply for permits with Canadian and US authorities. El Paso said the filings will be made by the end of 2002 and the line could be in service by the fourth quarter of 2005.

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