Washington (Platts)--16Jul2009

The US Federal Energy Regulatory Commission on Thursday gave the go-ahead
for Rockies Express Pipeline to add additional capacity to a segment that
serves natural gas producers in Wyoming and Colorado.

FERC issued a federal certificate for the pipeline's Meeker-to-Cheyenne
Expansion, which will add 200,000 Dt/day to the line's capacity in the gas
producing region and is tied to EnCana Marketing USA's contractual rights to
boost capacity.

The $78-million project would accommodate new Rocky Mountain gas supply.
"The project will benefit interconnecting pipelines and their customers by
enhancing their access to such supplies," FERC said.

"Further, there is no evidence that service on other pipelines will be
displaced as a result of the proposed project and no pipeline objected to
Rockies Express' proposals," FERC added.

The application by majority owner Kinder Morgan Energy Partners explained
that besides the basic need for more capacity, price competition and supply
stability also merit the expansion.

Rockies Express plans to boost by 200,000 Dt/d capacity from Meeker Hub
in Rio Blanco County, Colorado, to Wamsutter Hub in Sweetwater County,
Wyoming. Then the pipeline plans to add 200,000 Dt/d from Wamsutter east to
Cheyenne Hub in Weld County, Colorado.

The project means adding one 20,500-horsepower gas turbine at a Colorado
compressor station and a 17,500-horsepower unit at the Wyoming end.

In total, the project will increase capacity on the Meeker-to-Cheyenne
stretch -- also called the REX-Entegra segment -- to 1.3 million Dt/d from
Meeker to Wamsutter, and to 2 million Dt/d from Wamsutter to Cheyenne.

Rockies Express projects that revenue from the expansion will come to
$17.1 million in the first year, while it expects the total cost of service in
that first year to be $16.9 million.

--Joel Kirkland, joel_kirkland@platts.com