Colorado Interstate Gas Company, L.L.C. Non-binding Open Season Soliciting Interest in DJ Expansion Capacity of up to 1.2 Bcf/day

Transcription

1 Colorado Interstate Gas Company, L.L.C. Non-binding Open Season Soliciting Interest in DJ Expansion Capacity of up to 1.2 Bcf/day Portable Document Format (.pdf) file of Open Season: Colorado Interstate Gas Company, L.L.C. (CIG) is conducting a non-binding Open Season soliciting statements of interest in expansion capacity on its existing pipelines in the DJ Basin along Colorado s Front Range. CIG has identified opportunities to create between 100 Mdth/day and 1,200,000 Mdth/day of additional transportation capacity out of the DJ Basin to interstate natural gas pipeline interconnections at the Cheyenne Hub, and/or to other existing points on the CIG pipeline system. The incremental transportation capacity offered in this Open Season will have primary receipt rights at existing and potentially new interconnections with processing plants in the DJ Basin and will have primary delivery rights at various points off the CIG system at the Cheyenne Hub as described below. Depending on requested timing and volumes, CIG could have a portion of this capacity available as early as April 2019 and can stage further expansions to meet the anticipated needs of interested shippers. CIG anticipates the expansion capacity can be made available with minimal new pipeline construction activity using existing underutilized compression that is repurposed as needed, and with additional compression added as required to match production increases in the basin. Depending on timing, volume, and additional required new facilities, CIG anticipates that it would require 100% Load Factor rates for a 7 year term in the 10 cent to 11.5 cent/dth range, and/or rates for a 10 year term in the 8 cent to 9.75 cent/dth range.** This non-binding Open Season commences on February 22, 2018 and closes at 10:00 a.m. Mountain Time on March 15, Statements of interest should be submitted prior to the close of the Open Season to KMWestBids@kindermorgan.com using the form attached hereto. CIG will contact interested parties following the close of the Open Season to initiate discussions regarding the needs of the interested parties and the abilities of CIG to accommodate those needs. Questions concerning this Open Season should be directed to: Greg Ruben Laine Lobban DESCRIPTION OF THE DJ EXPANSIONS PIPELINES AND CAPACITY CIG owns, controls, or has an opportunity to acquire a number of different pipeline assets that can be used to provide the expansion capacity. By utilizing these various pipeline assets in connection with minor facility additions/modifications and the repurposing of existing compression assets and the potential installation of new compression facilities, CIG believes it can accommodate a wide variety of capacity expansion requirements, including requirements for expansion capacity that may ramp-up over time. The specific pipeline facilities and expansion opportunities under consideration by CIG include the following:

2 CIG Line No. 5C Expansions (500 Mdth/day): CIG could expand its south-to-north capacity on Line No. 5C in several increments via minor system modifications and reconfiguration of the pipeline to provide up to 500 Mdth/day of capacity to Cheyenne. Existing CIG 5AB receipt points would have secondary rights on the CIG 5C expansion capacity. Additionally, CIG could connect the High Plains Lancaster Lateral to CIG 5C to allow existing and new meter stations on High Plains Lateral access to this capacity. CIG HIGH PLAINS (350 Mdth/day): CIG could expand its High Plains facilities by utilizing off-system capacity from a third party. CIG anticipates connecting its High Plains Lateral system with the pipeline near Ft. St. Vrain and using a combination of off-system capacity on that pipeline with existing compression capacity at Cheyenne to provide up to 350 Mdth/day of expansion capacity from existing High Plains receipt points and potentially new interconnections with processing plants in the DJ Basin to Cheyenne. CIG High Plains Midpoint Compression Expansion (350 Mdth/day): CIG could construct a new midpoint compression facility on the High Plains Lateral that could provide an additional 220 Mdth/day of south-to-north capacity from existing or new DJ receipt points to points of delivery at the Cheyenne Hub. Additionally, CIG has identified an opportunity to reconfigure existing compression at Cheyenne (not included in any of the expansions above) to provide an additional 130 Mdth/day of incremental south-tonorth expansion capacity to Cheyenne. While the High Plains Midpoint Compression Expansion would not require additional pipeline facilities, it would require a FERC 7(c) filing for the new compression facilities and CIG anticipates a development timeline of 2 years from contracting to in-service. The various expansion opportunities described above could access some or all of the following delivery points at Cheyenne. The available capacity as of December 2018 is listed below and in most cases the capacity at these points could be expanded if needed. LOCATION PIN NUMBER LOCATION NAME INTERCONNECTING PIPE AVAILABLE CAPACITY (AS OF DECEMBER 2018) DTH/DAY Dullknife (DUL) Trailblazer 1,547, Thunder Chief (TDC) Cheyenne Plains 437, Curley (CUR) Cheyenne Plains 742, Bowie ((BOW) CIG 631, Rockport (RKP) TIGT 238, Little Wolf (LTW) PSCo 67, Owl Creek (OWL) PSCo 394, Sitting Bull (STB) REX 62, Dover (DOV) CIG 159, Red Cloud (RCD) Cheyenne plains 128, Tomahawk (TOM) Trailblazer 166, Ponderosa (PON) PSCO 236, Arrowhead (AHD) TIGT 184, Flying Hawk (FLY) High Plains 339,100 CIG has also identified opportunities to repurpose certain existing underutilized compression to facilitate deliveries into the Rockies Express Pipeline ( REX ) if that delivery point is requested. CIG will provide the requested transportation services under existing Rate Schedule TF-1 or TF-HP of CIG s FERC Gas Tariff (CIG s Tariff). For expansion proposals involving the use of off-system capacity, CIG anticipates providing for seamless service under CIG s Rate Schedule TF-HP, with CIG managing/administering that off-system capacity. CIG anticipates a portion of the expansion capacity could be available by approximately April 2019, and in increments thereafter to match production ramps in the DJ Basin.

3 CONDITIONS AND PROCEDURES FOR THE SUBMISSION OF STATEMENTS OF INTEREST Parties interested in potentially acquiring expansion capacity are invited to submit Statements of Interest using the attached form. Based on the information received in response to this solicitation, CIG will evaluate the various expansion opportunities to determine the best match with the Statements of Interest and will then initiate discussions with the interested parties with the goal of completing binding Transportation Precedent Agreements ( TPAs ). It is anticipated the TPAs will be subject to the results of one or more binding open seasons, and the receipt of approval from the appropriate management, management committee, and/or board of directors of bidder and its parent companies. In addition, the obligations of CIG under the binding TPAs will be subject to CIG s determination, in its sole discretion, that: - CIG is able to obtain any necessary regulatory or administrative authority to provide the expansion capacity; - Sufficient demand for the expansion capacity is demonstrated in this Open Season; - CIG is able to obtain any necessary CIG mainline capacity and/or any necessary off-system capacity on acceptable terms and conditions; and - The development of the additional capacity will provide an acceptable return on the expansion project. Creditworthiness Requirements: Shippers acquiring capacity on expansion projects will be required to satisfy the creditworthiness requirements of CIG's Tariff. In addition, in connection with service requiring the construction of new facilities, the shipper MAY also be required to demonstrate creditworthiness of up to two (2) years of anticipated charges for the awarded transportation capacity. CIG will assess the creditworthiness of each interested party in connection with the negotiation of the TPA and in accordance with Section 4.14 of CIG s Tariff. ** In addition to these rates, the expansion capacity would be subject to any applicable surcharges, including ACA, Fuel and L&U, and any other authorized surcharges assessed under the TF-HP or TF-1 Rate Schedule as those amounts may be amended or superseded from time-to-time.

4 STATEMENT OF INTEREST IN DJ BASIN EXPANSION CAPACITY Colorado Interstate Gas Company, L.L.C. Non-Binding Open Season Open Season EBB Identifier: 2018 Solicitation of Expressions of Interest in DJ Expansion Capacity Bid To: A. Shipper Information: Legal Name of Interested Party: Name of Authorized Representative: Title of Authorized Representative: DUNS Number: Phone: B. Desired Term of Service (e.g., 1 Year): Requested Term Start Date: Requested Term End Date: C. Desired Quantity: Maximum Daily Quantity (MDQ): Dth/day Receipt Point(s) Delivery Point(s) Requested Dth/day MDQ D. Reservation Rate (select one): CIG s maximum recourse rate Negotiated Rate: $ per Dth per Month

5 E. Additional Conditions or Requirements: Interested Party is invited to provide additional information regarding its needs or desires regarding the development of the expansion capacity, including but not limited to the schedule on which the interested party may desire to acquire the expansion capacity: