Questar Nears Completion of Southern Trails Pipeline Conversion

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Questar Southern Trails Pipeline Company (Salt Lake City, Utah) is set to begin transporting natural gas from the Bloomfield, New Mexico, receiving area to Needles, California beginning on July 1, 2002. The pipeline is a conversion of the old 693-mile "Four Corners" crude oil pipeline purchased from ARCO for $38 million. Conversion of the 160,000 barrel per day pipeline began in mid summer of 2001 after receiving full FERC approval on July 26, 2001.The pipeline terminates in Long Beach, California and the Needles to Long Beach segment will be completed at a later date.

The project consists of the conversion of six pump stations to compression, the construction of a new compressor station, eight miles of pipeline replacements, ten miles of pipeline realignments, fifty miles of pipeline extensions consisting of 20" & 22" diameter pipe, fifty new line valves, and full gas service from the four corners area of New Mexico to Long Beach. Of the 693-miles of pipeline to be converted or added, over 600-miles are already completed and four compressor stations will be converted for service by July 1, 2002. A total of 18,356 horsepower of reciprocating compression will enter service when the entire $155 million pipeline is completed. The refurbished pipeline will transport 90mmcfd through New Mexico & Arizona and 120mmcfd to gas hungry markets in California.

Questar Southern Trails Pipeline Company is a subsidiary of Questar Pipeline Company (Salt Lake City, Utah), which in turn is a wholly owned subsidiary of Questar Corporation (NYSE:STR) (Salt Lake City, Utah). Questar Corporation is a $2.9 billion diversified natural gas company expecting to grow by 10-15% in 2002 and has already increased its natural gas & oil production by 31% in the 1st quarter of 2002 over the similar period in 2001. Questar Corporation owns through Questar Pipeline Company over 2,000 miles of pipeline with a capacity of 1.5 bcf/d and natural gas storage facilities. Questar Corporation had capital expenditures of $987 million in 2001 including $406 million for acquisition activities and has estimated its 2002 capital expenditures program at $376 million, of which $180 million will be devoted to non-regulated activates and $165 million to its regulated activities. Questar Corporation's regulated group foresees spending $55 million on natural gas distribution systems, $42 million for transmission & storage projects, and $35 million for partnership projects.