Discovery Gas Transmission LLC and Discovery Producer Services LLC; Notice of Filings

Take notice that on July 23, 2003, Discovery Gas Transmission LLC (Discovery) 2800 Post Oak Blvd., Houston, Texas, 77056, filed with the Federal Energy Regulatory Commission (Commission) pursuant to Section 7(c) of the Natural Gas Act, and part 157 of the Commission's Regulations an abbreviated application to acquire, lease, and construct and to own and operate certain new delivery points, pipeline compression services and metering and appurtenant facilities to enable Discovery to deliver gas produced offshore to four additional delivery points (Discovery Market Expansion Project) and therefore to new markets in Southern Louisiana, all as more fully set forth in the application.

Discovery states that the four additional delivery points are proposed interconnections with Columbia Gulf Transmission Company (Columbia Gulf), Gulf South Pipeline Company, L.P. (Gulf South), Tennessee Gas Pipeline Company (Tennessee), and Transcontinental Gas Pipe Line Corporation (Transco).

In conjunction with Discovery's application, Discovery Producer Services LLC (DPS) filed an abbreviated application for a limited jurisdiction certificate to provide the compression services to Discovery as necessary to provide the services through Discovery's Market Expansion facilities. Both applications are on file with the Commission and open for public inspection. The filing is available for review at the Commission in the Public Reference Room or may be viewed on the Commission's Web site at http://www.ferc.gov using the “FERRIS” link. Enter the docket number excluding the last three digits in the docket number field to access the document. For assistance, please contact FERC Online Support at FERCOnlineSupport@ferc.gov or toll free at (866)208-3676, or for TTY, contact (202) 502-8659.

Discovery proposes to acquire from DPH, Inc. approximately 31 miles of existing, but currently unused, 20-inch pipeline in LaFourche and Terrebone Parishes, Louisiana and from DPS approximately 0.43 miles of 16-inch pipeline in LaFourche Parish, LA. Discovery also proposes to lease 100,000 dekatherms (Dt) per day of capacity on approximately 35 miles of Texas Eastern's system from Discovery's existing interconnect to the proposed interconnection with Transco. Discovery proposes to contract for compression from DPS to ensure adequate compression into the downstream pipelines at the proposed new delivery points. Discovery also proposes to construct the following facilities:

• 0.4 miles of 20-inch pipeline from the pipeline to be acquired from DPS to the pipeline to be acquired from DPH, Inc.;
• 2.1 miles of 20-inch pipeline from Point Au Chien on the pipeline to be acquired from DPH, Inc. to the proposed interconnection with Columbia Gulf;
• 735 feet of 20-inch gas line of an interconnecting facility from the end of the pipeline to be acquired from DPH, Inc. To a Tennessee platform on which will be located the proposed delivery point at Tennessee: and
• Metering, pressure regulating and appurtenant facilities at each of the proposed Columbia Gulf and Transco delivery points and upstream of the proposed Tennessee delivery point.

Discovery states that in order for it to provide up to 150,000 Dt per day of firm service through its Market Expansion facilities, Discovery proposes to purchase 150,000 Dt per day of compression services from DPS under a Compression Services Agreement. Discovery states that DPS is currently willing to provide this compression needed by Discovery for approximately two cents per Dt, provided that the Commission issues it a Limited Jurisdiction Certificate allowing DPS to use any 2 or 3 of its 4 existing leased compressors at any given time for compression needed by Discovery.

Discovery explains that it held a non-binding open season in April 2003 for its proposed Market Expansion Project seeking expressions of interest in service to the proposed new delivery points. Discovery asserts that it has executed or is in the process of negotiating binding precedent agreements for 112,000 Dt per day of firm service. Discovery further asserts that it also expects to ship gas on the new project on an interruptible basis for these and other shippers. Discovery proposes a maximum usage fee for Rate Schedule FT-2 (Market Expansion) service of 7.40 cents per Dt, based on firm service billing determinants of 150,000 Dt per day and not based on any allocation of costs to interruptible service. Discovery states that it also seeks approval of 14.80 cents per Dt as its maximum Rate Schedule IT (Market Expansion) rate and that this rate is based on a 50 percent load factor derivation of Discovery's Rate Schedule FT-2 rate. Discovery states that because of its usage fee-only design of its Rate Schedule FT-2 rate, there is no capacity being released on Discovery's system, and Discovery is totally at risk for the recovery of the cost of its Market Expansion facilities.

Any questions regarding the application may be directed to Kevin R. Rehm, Vice President, Discovery Gas Transmission LLC, 2800 Post Oak Boulevard—Level 36, Houston, Texas 77056, at (713) 215-2694, with fax at (713) 215-3050.

There are two ways to become involved in the Commission's review of this project. First, any person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before the comment date, file with the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214) and the regulations under the NGA (18 CFR 157.10). A person obtaining party status will be placed on the service list maintained by the Secretary of the Commission and will receive copies of all documents filed by the applicant and by all other parties. A party must submit 14 copies of filings made with the Commission and must mail a copy to the applicant and to every other party in the proceeding. Only parties to the proceeding can ask for court review of Commission orders in the proceeding. Comments and protests may be filed electronically via the internet in lieu of paper. See 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's Web site under the “e-Filing” link. The Commission strongly encourages intervenors to file electronically.

However, a person does not have to intervene in order to have comments considered. The second way to participate is by filing with the Secretary of the Commission, as soon as possible, an original and two copies of comments in support of or in opposition to this project. The Commission will consider these comments in determining the appropriate action to be taken, but the filing of a comment alone will not serve to make the filer a party to the proceeding. The Commission's rules require that persons filing comments in opposition to the project provide copies of their protests only to the party or parties directly involved in the protest.

Persons who wish to comment only on the environmental review of this project should submit an original and two copies of their comments to the Secretary of the Commission. Environmental commenters will be placed on the Commission's environmental mailing list, will receive copies of environmental documents, and will be able to participate in meetings associated with the Commission's environmental review process. Commenters will not be required to serve copies of filed documents on all other parties. However, Commenters will not receive copies of all documents filed by other parties or issued by the Commission, and will not have the right to seek rehearing or appeal the Commission's final order to a Federal court.

The Commission will consider all comments and concerns equally, whether filed by commenters or those requesting intervener status.

The Commission may issue a preliminary determination on non-environmental issues prior to the completion of its review of the environmental aspects of the project. This preliminary determination typically considers such issues as the need for the project and its economic effect on existing customers of the applicant, on other pipelines in the area, and ion landowners and communities. For example, the Commission considers the extent to which the applicant may need to exercise eminent domain to obtain rights-of-way for the proposed project and balances that against the non-environmental benefits to be provided by the project. Therefore, if a person has comments on community and landowner impacts from this proposal, it is important to file comments or to intervene as early in the process as possible.

Comment Date: August 22, 2003.