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Southern Star Central Gas Pipeline

Southern Star Central Gas Pipeline. Fall Customer Meeting. Overland Park, Kansas October 16, 2008. Bob Bahnick. Senior Vice President, Operations & Technical Services. 2008 Pipeline Integrity Work. Install 7 sets of launchers/receivers for 2008-2009 ILI investigations

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Southern Star Central Gas Pipeline

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  1. Southern Star Central Gas Pipeline Fall Customer Meeting Overland Park, Kansas October 16, 2008

  2. Bob Bahnick Senior Vice President, Operations & Technical Services

  3. 2008 Pipeline Integrity Work • Install 7 sets of launchers/receivers for 2008-2009 ILI investigations • Complete 9 ILI investigations covering 415 miles and 11.7 miles HCA • Pressure test KPL 16” covering 2 miles HCA • Replace 762’ Carrollton 8” covering 0.1 miles HCA • Replace 1,015’ Sedalia 12” covering 0.2 miles HCA • Complete integrity tests of the McLouth Storage Field. • EJC 26 inch ILI run, 9.5 miles • EJC 1&2 16inch ILI run, 2.1 miles • Pressure test an additional 9.21 miles

  4. 2009 Pipeline Integrity Work • Install 7 sets of launchers/receivers for 2009 and 2010 ILI investigations • Make modification to line FS (Southern Trunk from Tom’s Corner to the Rangeline 16”) to allow pigging. Will require replacement of 16 inch pipe with 20 inch pipe under a Hwy crossing • Complete 12 ILI investigations covering 241 miles and 18.1 miles HCA • Complete 4 pressure tests covering 5.7 miles HCA • Complete 8 ILI runs in the storage fields covering 24.6 miles • Complete integrity test of Colony Storage fields by hydro-testing 17.1 miles of pipe

  5. Daryl Johnson Vice-President, Rates & Regulatory Affairs

  6. CP07-89 – North Welda Storage • Southern Star Central Filed 2/23/07 • Sought authority to: • Expand certificated boundary • Redefine the caprock • Install storage gas recycle system • Protests were filed and eventually withdrawn • Answered FERC data requests June - Nov • Order issued on 7/16/08 • Approved redefining caprock • Approved installing recycle system • Denied lateral expansion of boundary • SSC requested rehearing for limited lateral expansion – awaiting order

  7. CP08-4 – South Welda Storage • Southern Star Central Filed 10/05/07 • Sought authority to: • Expand certificated boundary • Redefine the caprock • Enhance existing storage gas recycle system • No Protests were filed • Answered FERC data requests Dec - Feb • Order issued on 5/9/08 • Approved redefining caprock • Approved enhancing recycle system • Denied lateral expansion of boundary • SSC requested rehearing/clarification of lease acquisition rights – Approved 8/6/08

  8. Fuel Filing RP07-96 • Southern Star Central Filed 12/1/2006 • Protests filed with FERC 12/2006 • Order accepted subject to refund 12/29/2006 • Technical Conference 2/2/2007 • Data Requests and Responses 2/2007-5/2007 • Objections Withdrawn by 7/3/2007 • Order approving filed rates issued 7/23/08

  9. Fuel Filing RP08-84 • Southern Star Central Filed 11/30/2007 • Protests filed with FERC 12/2007 • Order accepted subject to refund 12/28/2007 • Technical Conference 2/8/2008 • Data Requests and Responses 2/22/2008-3/5/2008 • Initial Comments filed by 3/19/2008 • Reply Comments filed by 4/2/2008 • Southern Star sent Initial Offer of Settlement on 4/14/2008 • Reached an Agreement in Principle on 5/20/08 • Filed Settlement on 5/30/08 – Approved 7/3/08 • Billed settlement fuel rates beginning 6/1/08

  10. Limited Waiver Filing RP08-443 • Southern Star Central Filed 7/11/08 • Purpose • Waive any overruns, balancing fees and cash-outs caused by the retro-active application of the fuel settlement rates in Docket No. RP08-84 • SSC cannot waive tariff provisions without FERC authority • Order approving waivers issued 8/15/08

  11. Rate Case - RP08-350 SSC Filed 4/30/08 Numerous Protests were filed in May Order issued 5/29/08 accepting rate increase, subject to refund and suspending until 11/01/08 Pre-Hearing Conference held on 6/10/08 and discovery began Answered approx. 1,000 data requests

  12. Rate Case - RP08-350

  13. Rate Case - RP08-350

  14. Rate Case - RP08-350

  15. Rate Case - RP08-350 • First settlement conference was held on 10/7/08 • All parties stated their positions/issues • All parties agreed on the following: • SSC’s Motion Rate Filing • Next Settlement Conference • What we hope to accomplish

  16. Rate Case - RP08-350 Motion RateFiling • Motion Rate Filing will include the following: • Rates will reflect plant in-service at 10/31 • Reflect reductions in cost of service related to the fuel settlement in RP08-84 • Correction of Stmt D in original filing • Motion Rate Filing will NOT include the following: • Tariff sheets to eliminate Section 32 – Third Party Storage • Tariff sheets to charge transportation commodity rate on gas transported to storage • Tariff sheets to charge transmission fuel on gas withdrawn from storage

  17. Rate Case - RP08-350 Next Settlement Conference • SSC will provide the active parties an Offer of Settlement on October 29th • Parties will have a 2 day settlement conference in Wash. DC beginning at 1pm on November 12. • What we hope to accomplish: • Achieve an Agreement in Principle by the end of November and place settlement rates into effect prior to billing November business.

  18. Gary Hines Manager - Gas Management

  19. Gas Management Update Storage Inventory & Fall Shut-In Tests Remaining 2008 Planned Maintenance Upcoming 2009 Planned Maintenance Weather Gas Quality Waivers 19

  20. National EIA – 5 Year Comparison Note: The shaded area indicates the range between the historical minimum and maximum values for the weekly series from 2003 through 200. Source: Form EIA-912, "Weekly Underground Natural Gas Storage Report." The dashed vertical lines indicate current and year-ago weekly periods.

  21. SSC Storage EIA

  22. Current Storage Status42 • Shut-In Tests Underway • Through first week of November • Why Perform A “High-Inventory” Test? • GT&C Section 13.4 • Fall High Inventory • “…perform the end-of-the-injection-cycle shut-in pressure test on each field at the point in time when SSC reasonably believes the field is at or near the highest inventory level that will be achieved…”

  23. Remaining 2008 Planned Maintenance None Planned! However… Performing pipeline in-line inspection verification digs Additional identified anomalies may warrant pressure or throughput reductions Some minor additional construction activities Best way to stay abreast: Ensure you receive the Planned Service Outage (PSO) emails How to find out? CSI report CSI050 Contact Type: Planned Service Outage How Can We Make Notifications Better??? 23

  24. HDD & CDD for YTD vs. Averages

  25. Current Gas Quality Waivers • Line Segment 190 & KMIGT-Franklin (LocID 16593) • CO2 waiver (see posted requirements) • Line Segment 315 & 377 (Straight-Blackwell) • CO2 waiver (see posted requirements) • Always Evaluating Others

  26. Dale Sanders Contract Administration

  27. Order 712 • Issued June 19th, 2008 • Major modifications to regulations for Cap. Release

  28. Highlights • Price caps removed on Short Term Cap. Releases • Asset Management Arrangements (AMA)

  29. Reminders • Change in Customer Look-up on Capacity Release Offer Screens

  30. Reminders • Unique Usernames and Passwords

  31. Reminders • Password Resets • Pre-Approved Bidders List

  32. David Bristow Manager Scheduling & Billing

  33. Operational Flow Order (OFO) By Definition from Tariff: order issued to alleviate conditions which threaten or could threaten the safe operations or system integrity or to maintain operations required to provide efficient and reliable firm service. Who does this affect? Rate Schedules ITS, ISS, TSS, FSS, STS, SFT and FTS Point Operators with operational control of receipt/delivery point(s) Who Does Southern Star Notify? Those individuals on the CSI OFO Distribution List All customers must have an OFO contact 33

  34. Operational Flow Order (OFO) (cont’d) Categories of OFO’s: Standard Preventative Action to neutralize and/or reduce threats Emergency Immediate Action needed to neutralize and/or prevent threats 34

  35. Operational Flow Order (OFO) (cont’d) Types of OFO’s: Storage Injections & Withdrawals System Maintenance Line Segment Specific Peak Hour Deliveries System Balance “North/South” Balance Any Other Deemed Necessary To Protect System Integrity 35

  36. Jim Neukam Manager – Customer Services & Business Development

  37. Customer Services & Business DevelopmentGoals & Objectives Customer Service & Account Management Develop in-depth, working knowledge of customer contracts and their business needs and challenges Promptly address and respond to Customer questions and requests Ensure innovative and effective solutions to Customer expectations Develop and coordinate Customer meetings and follow-up visits

  38. Customer Services & Business DevelopmentGoals & Objectives (Cont.) Gas Supply & Interconnects Identify, evaluate, and pursue enhanced gas supply opportunities Manage Customer Interconnect Process Research and assess gas supply studies to ensure adequate gas supply

  39. Customer Services & Business DevelopmentGoals & Objectives (Cont.) Business Development Identify, evaluate, and pursue new opportunities and incremental markets Collaborate with Customers on creative business opportunities Research gas industry projects and competitive business initiatives Oversee projects in compliance with regulations and contractual obligations

  40. Gas Supply Update – 2008 - 2009 Incremental Volumes Currently there are nine other projects being assessed as viable new supply points or in pre-construction phases.

  41. Available ServicesWinter 2007–2008 • Production Area Firm & Interruptible Transportation • Market Area Interruptible Transportation • Park and Loan Service • Interruptible Storage Service

  42. Winter Capacity Status (Markets) Kansas City Metro & North of Ottawa LS 90, 115, 145, 180, 190, 250 100% Subscribed Wichita LS 120 & 333 100% Subscribed East of Grabham LS 215, 225, 260, 423, , 450, 455 100% Subscribed

  43. Winter Capacity Status (Production) Rawlins-Hesston LS 490, 491 100% Subscribed West Kansas LS 130 Potential Opportunity West Oklahoma LS 315, 377, 458 Potential Opportunity South Oklahoma LS 380, 400, 385 Select Opportunity

  44. Grow our Services • Access to Additional Gas Supply from the Rockies Production • Access to Gas Supply from the New & Developing Production – Shale, etc. • Gas Storage Options – Help us define your needs! • Opportunities for New Flow Paths – Hub Services

  45. PhilipRullman Director, Commercial Services

  46. 2008 Customer Satisfaction Survey Results

  47. Survey Focus Items • Overview of Results • Quality of Service • Quality of Communications • Quality of Operations • Product Related Services • Comparison of Importance & Performance

  48. Overview of Results • Importance • Average importance: 9.1 • Range from 8.3 to 9.9 • Performance • Average performance: 8.8 • Range between 8.3 to 9.5

  49. Key Survey Question • Southern Star communicates with you in an honest and forthright manner • Importance – 9.9 • Performance – 9.5

  50. Customers Voice We are hearing you loud and clear on areas of improvement! Action Plan • Customer Survey Action Team will review items and develop action plan by 12/31/08 • CSI Review on key items

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