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Ruby Pipeline Wyoming Pipeline Authority January 15, 2008 Ed Miller EPWP Dan Fitzgerald PG&E.

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Presentation on theme: "Ruby Pipeline Wyoming Pipeline Authority January 15, 2008 Ed Miller EPWP Dan Fitzgerald PG&E."— Presentation transcript:

1 Ruby Pipeline Wyoming Pipeline Authority January 15, 2008 Ed Miller EPWP Dan Fitzgerald PG&E

2 2 El Paso Corporation Overview El Paso Corporation provides natural gas and related energy products in a safe, efficient, dependable manner. We own North Americas largest natural gas pipeline system and are one of North Americas largest independent natural gas producers. We are organized around regulated and non- regulated businesses.

3 3 El Paso Pipeline System 19% of total U.S. interstate pipeline mileage 23 Bcf/d capacity (16% of total U.S.) 16 Bcf/d throughput (28% of gas delivered to U.S. consumers) Best market connection Best supply access Leading pipeline integrity program El Paso Natural Gas Mexico Ventures Mojave Pipeline Colorado Interstate Gas Wyoming Interstate Cheyenne Plains Pipeline Tennessee Gas Pipeline Southern Natural Gas Florida Gas Transmission (50%) Elba Island LNG

4 4 Ruby Pipeline Map Malin Opal Hub U T A H N E V A D A O R E G O N C O L O R A D O I D A H O C A L I F. W Y O M I N G CIG Kern River Paiute Tuscarora PG&E GTN Ruby Pipeline Opal to Malin WIC Cheyenne Plains Cheyenne Uinta Basin Piceance Basin

5 5 Ruby Capacity and Facilities Design and rates are based upon 1.2 Bcf/d of capacity 680 miles from Opal to Malin 42, 1,440 psig pipe design –Most cost effective design taking fuel and expansion opportunities into consideration Compressor stations –Opal ~45,400 HP (site rating) –Midpoint ~18,200 HP (site rating) –Fuel from Opal ~0.9% Four delivery point interconnects and five receipt point interconnects Expandable to 2 Bcf/d with compression

6 6 Ruby Highlights to Date 1.2 Bcf/d pipeline from Opal to Malin Ownership structure –El Paso Western Pipelines –PG&E Corporation –Bear Energy During past 5 months, Ruby Project has been presented to most Rockies producers and some western markets under Confidentiality Agreements Ruby filed an application with the BLM in November to construct a pipeline between Opal and Malin Negotiations with pipe mills and contractors have been ongoing for over 6 months –Estimate has been finalized during this process Approximately 50% of firm capacity has been committed Ruby requires firm capacity commitments of 1.2 Bcf/d to be constructed

7 7 Rockies versus Western Canada Long-Term Production Trends Best fit of Current Trend: Peak - 14 Bcfd Production El Paso Base Case El Paso High Case Best Fit Curves Assumes: - Gaussian Curve EUR - Few environmental constraints El Paso Base case suggest 9,650 Bcfd of export capacity needed (currently 6,200 in 2007) to meet 85% LF requirement El Paso High case suggest 12,000 Bcfd of export capacity needed (currently 6,200 in 2007) to meet 85% LF requirement Canadian Peak Peak - 17 Bcfd

8 8 Rocky Mountain Production by Basin (Volumes are Wellhead – Measured in MMcfd) : Wellhead total data from IHS database 2006: Estimate : El Paso forecast

9 9 Projected Gas Flows with Ruby Chicago NE AECO 3.28% fuel Malin (GTN) 1.3% fuel NORTHERN CALIFORNIA 2.87% fuel 2.98% fuel Kern 1.3% fuel San Juan Western Canada Production Local ConsumptionExportable Projected 2012 Price w/Ruby Pipeline Fuel Only Dispatch Malin Price AECO ROX Ruby 0.9% fuel NWP TC 2012 Northern CA Economic Dispatch 2.87% fuel 1.82% fuel Bcf/d Total Eastbound pipeline capacity 12 Bcf/d Ruby gas will be first through the meter at Malin 1.68% fuel Total Westbound pipeline capacity 2.6 Bcf/d ROX Basis Improvement w/Ruby 2012: $0.50-$ : $ $1.75 ROX 1% fuel 4.8% to 5.3% fuel 5.75% fuel

10 10 Ruby Proposed Next Steps April-Oct. 2008Feb./Mar. 2008Jan January Ruby Packages Customer Follow-Up October 2008 State Regulatory Approvals May 2008 Transporter Board Approval February-March Binding Open Season April 2008 Shipper Board Approvals February El Paso Upstream Capacity Open Season

11 11 Ruby Schedule Highlights July-November Route Surveys and Mapping March Pipe Option April Receive Certificate January FERC Prefiling January File FERC Certificate Application October Pipe Commitment July Commence Construction March 2011 In-Service Preliminary route work completed May Formal Customer Discussions Commence Filed route with BLM

12 12 Market Overview

13 13 U.S. West Coast Distinct Gas Markets Supplied primarily from two regions: 1. Western Canadian Sedimentary Basin 2. Western Domestic Basins (Rockies, San Juan and Permian) Pacific Northwest 600 Bcf/yr Northern California 835 Bcf/yr Northern Nevada 65 Bcf/yr Southern California 965 Bcf/yr

14 14 Malin Takeaway 2.2 Bcf/d firm takeaway capacity plus displacement on GTN at Malin Access to west coast market: –Northern/Central California via Pacific Gas and Electric Company –Northern Nevada via Tuscarora Gas Transmission –Pacific Northwest via GTN and indirectly to Williams Northwest Pipeline and Avista Utilities –Southern California via deliveries off PG&E system Access to 82 Bcf of underground storage –PG&E (CA): 42 Bcf –Wild Goose (CA): 24 Bcf * –Lodi (CA): 16 Bcf * WASHINGTON IDAHO BRITISH COLUMBIA OREGON CALIFORNIA PG&E Tuscarora Gas Transmission GTN Northwest Pipeline Mist Jackson Prairie Malin Sumas NEVADA Seattle Portland San Francisco Ruby * Currently being expanded Line 400 Line 401 Line 300 Line 2 Lodi Wild Goose Pleasant Creek Los Medanos PG&E Area of Detail McDonald Island Natural Gas Storage

15 15 Northern/Central California Market 2006 Demand 2006 annual gas demand of 835 Bcf Annual growth forecasted at 1.3% through 2025 –Results in incremental requirement of 67 Bcf of annual gas demand by 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 demands Two strong gas demand periods –Winter: Large residential demand –Summer: Large gas-fired generation load and storage injections Jan FebMar Apr May Jun Jul AugSepOct Nov Dec Bcf/day Sources: 2006 California Gas Report and PG&E CGT Pipe Ranger

16 16 Northern Nevada Market 2006 Demand Annual gas demand of 64 Bcf Annual growth forecasted at 4.0% through 2016 –Results in incremental requirement of 17 Bcf of annual gas demand by 2012 Seasonal demand 2006 Peak day demand was 0.32 Bcf –Lovelock LNG storage (1.0 Bcf) located near Reno, NV serve peak day demands Ruby interconnects with both Paiute (near Lovelock) and Tuscarora (at Malin) JanFebMarAprMayJunJulAugSepOctNovDec Bcf/day Seasonal Market with a Winter Peak

17 17 Pipelines in Northern Nevada IDAHO OREGON Northwest Pipeline NEVADA Reno Tuscarora Paiute GTN CALIFORNIA PG&E 0.2 Bcf/d Malin 0.17 Bcf/d UTAH RUBY Northern Nevada is served via two pipelines (Tuscarora and Paiute) Paiute Pipeline –Largest customers: SWG, Sierra Pacific 96% of transport contracts –155 MDth/d receipt capacity from NWPL ~75 MMcf/d sources from Canadian supply NWPL contracts expire by 2009 –System operates at an average load factor of 71% Tuscarora Gas Transmission –Largest customers: Sierra Pacific, SWG, Barrick Gold Represent 96% of transport –Certificate 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 Malin –SWG and Barrick do not hold capacity on upstream pipe

18 18 Pacific Northwest (PNW) Market 2006 Demand Annual gas demand of 600 Bcf Annual growth forecasted at 2.1% through 2012 –Results in incremental requirement of 80 Bcf of annual gas demand by peak day demand was 2.9 Bcf –Jackson Prairie, MIST and Clay Basin storage fields serve peak day demands Gas-fired power generation load varies depending on hydro power availability Demand is more seasonal JanFebMarAprMayJunJulAugSepOctNovDec Bcf/day WASHINGTON IDAHO BRITISH COLUMBIA OREGON GTN Northwest Pipeline Seattle s Kingsgate Sumas MIST Portland s Jackson Prairie NWN Malin NEVADA Sources: Northwest Gas Association 2006 Outlook and Northwest Pipeline and GTN Scheduled Volumes

19 19 Contacts Ed Miller Business Development Roland Harris Business Development Russ Council Engineering Jennifer Webster Government Affairs Dan Fitzgerald Jeff Rawls El Paso Western PipelinesPG&E Bear Energy

20 Ruby Pipeline Wyoming Pipeline Authority January 15, 2008 Ed Miller EPWP Dan Fitzgerald PG&E

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