2 El Paso Corporation Overview El Paso Corporation provides natural gas and related energy products in a safe, efficient, dependable manner. We own North America’s largest natural gas pipeline system and are one of North America’s largest independent natural gas producers. We are organized around regulated and non-regulated businesses.
3 El Paso Pipeline System Tennessee Gas PipelineWyoming InterstateColorado Interstate GasCheyenne Plains PipelineMojave PipelineSouthern Natural GasElba Island LNGEl Paso Natural GasMexico VenturesFlorida Gas Transmission (50%)19% of total U.S. interstate pipeline mileage23 Bcf/d capacity (16% of total U.S.)16 Bcf/d throughput (28% of gas delivered to U.S. consumers)Best market connectionBest supply accessLeading pipeline integrity program
4 Ruby Pipeline Map Ruby Pipeline Malin Opal to Malin Opal Hub GTN PG&E O R E G O NGTNI D A H OMalinRuby PipelineOpal to MalinW Y O M I N GPG&EOpal HubCIGTuscaroraWICC A L I F .PaiuteCheyenneCheyennePlainsU T A HUintaBasinN E V A D APiceanceBasinKern RiverC O L O R A D O
5 Ruby Capacity and Facilities Design and rates are based upon 1.2 Bcf/d of capacity680 miles from Opal to Malin42”, 1,440 psig pipe designMost cost effective design taking fuel and expansion opportunities into considerationCompressor stationsOpal ~45,400 HP (site rating)Midpoint ~18,200 HP (site rating)Fuel from Opal ~0.9%Four delivery point interconnects and five receipt point interconnectsExpandable to 2 Bcf/d with compression
6 Ruby Highlights to Date 1.2 Bcf/d pipeline from Opal to MalinOwnership structureEl Paso Western PipelinesPG&E CorporationBear EnergyDuring past 5 months, Ruby Project has been presented to most Rockies producers and some western markets under Confidentiality AgreementsRuby filed an application with the BLM in November to construct a pipeline between Opal and MalinNegotiations with pipe mills and contractors have been ongoing for over 6 monthsEstimate has been finalized during this processApproximately 50% of firm capacity has been committedRuby requires firm capacity commitments of 1.2 Bcf/d to be constructed
7 Rockies versus Western Canada Long-Term Production Trends Canadian Peak2001 Peak- 17 BcfdEl Paso High CaseBest fit of Current Trend:Peak- 14 Bcfd ProductionEl Paso Base CaseEl Paso Base case suggest 9,650 Bcfd of export capacity needed (currently 6,200 in 2007) to meet 85% LF requirementEl Paso High case suggest 12,000 Bcfd of export capacity needed (currently 6,200 in 2007) to meet 85% LF requirementBest Fit Curves Assumes:- Gaussian Curve- 320 EUR- Few environmental constraintsEl Paso Base case suggest 9,650 Bcfd of export capacity needed (currently 6,200 in 2007) to meet 85% LF requirementEl Paso High case suggest 12,000 Bcfd of export capacity needed (currently 6,200 in 2007) to meet 85% LF requirement
8 Rocky Mountain Production by Basin (Volumes are Wellhead – Measured in MMcfd): Wellhead total data from IHS database2006: Estimate: El Paso forecast
9 Projected Gas Flows with Ruby Western CanadaProductionLocalConsumptionExportable200815.695.0110.0201214.325.838.49Bcf/d5.75% fuelAECOTotal Westbound pipeline capacity2.6 Bcf/dTotal Eastbound pipeline capacity12 Bcf/d3.28% fuel4.8% to 5.3% fuelNENWPChicagoMalin (GTN)1.68%fuel1.82% fuel1.3%fuelRubyROXROX BasisImprovement w/Ruby2012: $0.50-$0.602015: $ $1.750.9% fuelNORTHERNCALIFORNIA2.98% fuelKern1.3%fuelTC1% fuelSan Juan2.87% fuel2012 Northern CA Economic Dispatch2.87% fuelProjected2012 Pricew/RubyPipelineFuel OnlyDispatchMalin PriceAECO7.390.2517.641ROX7.520.06837.588Ruby gas will befirst through themeter at Malin
13 U.S. West Coast Distinct Gas Markets Supplied primarily from two regions:1. Western Canadian Sedimentary Basin2. Western Domestic Basins(Rockies, San Juan and Permian)Pacific Northwest 600 Bcf/yrNorthern California 835 Bcf/yrNorthern Nevada 65 Bcf/yrSouthern California 965 Bcf/yr
14 Malin TakeawaySumasBRITISH COLUMBIA2.2 Bcf/d firm takeaway capacity plus displacement on GTN at MalinAccess to west coast market:Northern/Central California via Pacific Gas and Electric CompanyNorthern Nevada via Tuscarora Gas TransmissionPacific Northwest via GTN and indirectly to Williams’ Northwest Pipeline and Avista UtilitiesSouthern California via deliveries off PG&E systemAccess to 82 Bcf of underground storagePG&E (CA): 42 BcfWild Goose (CA): 24 Bcf *Lodi (CA): 16 Bcf *WASHINGTONNorthwest PipelineSeattleJackson PrairieMistPortlandGTNIDAHOOREGONMalinRubyTuscarora Gas TransmissionCALIFORNIANEVADAPG&E Area of DetailPG&ELine 400Wild GooseLine 401Pleasant CreekLodiSan FranciscoLos MedanosMcDonaldIslandLine 401Line 300* Currently being expandedNatural Gas StorageLine 2
15 Northern/Central California Market 2006 Demand 2006 annual gas demand of 835 BcfAnnual growth forecasted at 1.3% through 2025Results in incremental requirement of 67 Bcf of annual gas demand by 20122006 peak day demand was 3.5 Bcf (2007 peak day of 3.9 Bcf)PG&E, Wild Goose and Lodi storage fields serve peak day demandsTwo strong gas demand periodsWinter: Large residential demandSummer: Large gas-fired generation load and storage injections4.03.53.0Bcf/day2.52.01.5JanFebMarAprMayJunJulAugSepOctNovDecSources: 2006 California Gas Report and PG&E CGT Pipe Ranger
16 Northern Nevada Market 2006 Demand Annual gas demand of 64 BcfAnnual growth forecasted at 4.0% through 2016Results in incremental requirement of 17 Bcf of annual gas demand by 2012Seasonal demand2006 Peak day demand was 0.32 BcfLovelock LNG storage (1.0 Bcf) located near Reno, NV serve peak day demandsRuby interconnects with both Paiute (near Lovelock) and Tuscarora (at Malin)0.35Seasonal Market with a Winter Peak0.300.250.20Bcf/day0.150.100.05JanFebMarAprMayJunJulAugSepOctNovDec
17 Pipelines in Northern Nevada Northern Nevada is served via two pipelines (Tuscarora and Paiute)Paiute PipelineLargest customers: SWG, Sierra Pacific96% of transport contracts155 MDth/d receipt capacity from NWPL~75 MMcf/d sources from Canadian supplyNWPL contracts expire by 2009System operates at an average load factor of 71%Tuscarora Gas TransmissionLargest customers: Sierra Pacific, SWG, Barrick GoldRepresent 96% of transportCertificate issued 7/24/07 for an expansion of 40 MDth/d that will serve the Tracy Power Plant (514 MW)22.5-year contract with Sierra Pacific Power (40 MDth) upstream of MalinSWG and Barrick do not hold capacity on upstream pipeNorthwest PipelineGTNIDAHOOREGONMalinRUBYPG&ETuscarora0.17 Bcf/dUTAH0.2 Bcf/dPaiuteCALIFORNIARenoNEVADA
18 Pacific Northwest (PNW) Market 2006 Demand SumasBRITISH COLUMBIAKingsgateWASHINGTONNorthwest PipelineSeattle3.53.0sJackson PrairieMIST2.5sPortlandIDAHONWNGTNBcf/day2.0OREGON1.51.0Malin0.5NEVADAJanFebMarAprMayJunJulAugSepOctNovDecAnnual gas demand of 600 BcfAnnual growth forecasted at 2.1% through 2012Results in incremental requirement of 80 Bcf of annual gas demand by 20122006 peak day demand was 2.9 BcfJackson Prairie, MIST and Clay Basin storage fields serve peak day demandsGas-fired power generation load varies depending on hydro power availabilityDemand is more seasonalSources: Northwest Gas Association 2006 Outlook and Northwest Pipeline and GTN Scheduled Volumes
19 Contacts El Paso Western Pipelines PG&E Bear Energy Ed Miller Business DevelopmentRoland HarrisRuss CouncilEngineeringJennifer WebsterGovernment AffairsDan FitzgeraldJeff RawlsBear Energy
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