Subject: Aberdeen and Welcome
From: [email-masked]
To: [email-masked], [email-masked]
Cc: [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked]
Date: Thu, 18 Oct 2001 09:40:26 -0700 (PDT)

Lynn/Karen:
 
The November 1 termination of the reverse auction point on Northern will increase the probability of priority mismatches at Aberdeen and Welcome between our two systems.  
 
We have already received questions asking how we will confirm these points after the 1st.  And our response has been that we would expect the restricting party to dictate who can and cannot flow at these locations.  
 
One party that has been surprisingly quiet so far has been Mirant.   Mirant should be very interested in how we will allocate capacity at these two points on November 1, simply because their contracts have the greatest risk of not being scheduled.  They are the only firm shipper on Northern Border that have Aberdeen and Welcome as contracted path end points.  And as you know, they supplied the reverse auction point.   But from what we have heard on the street, they are not actively matching up their supply with those markets who were allocated reverse auction capacity on your system.  That is why I feel the odds are high for a capacity mismatch.
 
Mirant does have a couple of options with their Welcome contract on Border; they can drop some of their Welcome gas off at a secondary upstream point, such as Marshall.  But their Aberdeen contract needs to flow at either Aberdeen or Warner on our system.  And if their capacity is stranded at Aberdeen on the 1st, I am confident that they will be giving both of us a call.  
 
Between Aberdeen and Warner (our alternate delivery point to NWPS), we have the ability to deliver into this area an aggregate of over 70 MMcf/d.  If we do see firm and interruptible gas nominated into these points in excess of this amount, I feel Northern Border must zero out the interruptibles on our side - that was the issue that created so much heart burn for Pan Alberta years ago when we were forced to allocate Ventura.  But that is as far as we are planning to go.   We view the flow restriction to be on your side.  And we are suggesting that your priorities be used to allocate Aberdeen on the 1st. 
 
If we do a firm allocation based on Border's priorities before we confirm, we would have a definite mismatch, and potentially nothing would be scheduled at the point.  Now that would not be all bad, given that we could use such an opportunity to deliver off the large OBA imbalance gas due NNG at the point.  But I don't think we want to fire up a battle with the shippers on both sides of the fence; we'll deal with Mirant on our end.  
 
As for the Aberdeen OBA imbalance issue, I am still trying to come up with a long term solution to deal with that situation.  Any ideas as to how we can effectively eliminate the imbalance would be greatly appreciated, especially given the fact that the Energy Affiliate NOPR suggests that the flexibility we may have today could be restricted in the future.
 
sc