Palomar Gas Transmission LLC, a newly formed joint venture of TransCanada Corp. and Northwest Natural Gas Co. (NW Natural), on Monday announced a proposal to build a natural gas pipeline that would serve growing markets in Oregon, the Pacific Northwest, and the western U.S. If approved, the new transmission line is scheduled to begin service in late 2011.
Palomar was formed by TransCanada and NW Natural to design, construct, and own the Palomar pipeline. TransCanada and NW Natural are equal owners of the joint venture. TransCanada's Gas Transmission Northwest System (GTN), headquartered in Portland, will operate the proposed pipeline. The partners are seeking a federal certificate to build and operate a pipeline extending approximately 220 miles from northwestern Oregon to north-central Oregon.
The Palomar pipeline will connect TransCanada's existing GTN System in central Oregon with NW Natural's distribution system near Molalla, Oregon, approximately 30 miles southeast of Portland. NW Natural's utility operations has agreed to contract for about 100 million cubic feet per day of capacity on the 36-inch-diameter pipeline.
"NW Natural currently depends on a single interstate pipeline for its supply, approximately two-thirds of which comes through the Columbia Gorge," said Gregg Kantor, president and chief operating officer of NW Natural. "The Palomar pipeline would significantly diversify our delivery options and enhance reliability for NW Natural's customers." NW Natural serves about 641,000 residential, business, and industrial customers in Oregon and southwest Washington.
NorthernStar LLC, developer of the proposed Bradwood Landing liquefied natural gas (LNG) terminal, may elect to take capacity on Palomar should the Bradwood Landing terminal and the Palomar pipeline be constructed.
"This project is being designed so that, if an LNG terminal is constructed on the Columbia River, the Palomar pipeline can be extended to serve it," Kantor said.
The total cost of the project is estimated to be between $600-700 million in current dollars if both proposed sections are built.
Palomar will request preliminary environmental approval for the project from the Federal Energy Regulatory Commission (FERC), the pipeline's principal regulator. Even before that filing is made, Palomar will begin the public engagement process in which parties, including landowners, will have the opportunity to ask questions, register comments, and provide input into the overall pipeline certificate process.
TransCanada's network of more than 36,500 miles of pipeline taps into virtually all major gas supply basins in North America. TransCanada is one of the continent's largest providers of gas storage and related services with approximately 360 billion cubic feet of storage capacity. A growing independent power producer, TransCanada owns, or has interests in, approximately 7,700 megawatts of power generation in Canada and the United States. TransCanada's Gas Transmission Northwest system, headquartered in Portland, has been operating in Oregon since 1963.