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Overland Park, KansasOctober 16, 2008
Southern Star Central Gas Pipeline
Fall Customer Meeting
Bob Bob BahnickBahnick
Senior Vice President, Senior Vice President,
Operations & Technical ServicesOperations & Technical Services
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 milesEJC 1&2 16inch ILI run, 2.1 milesPressure test an additional 9.21 miles
2009 Pipeline Integrity Work
Install 7 sets of launchers/receivers for 2009 and 2010 ILI investigationsMake 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 crossingComplete 12 ILI investigations covering 241 miles and 18.1 miles HCAComplete 4 pressure tests covering 5.7 miles HCAComplete 8 ILI runs in the storage fields covering 24.6 milesComplete integrity test of Colony Storage fields by hydro-testing 17.1 miles of pipe
Daryl Daryl JohnsonJohnson
Vice-President, Rates & Vice-President, Rates & Regulatory AffairsRegulatory Affairs
CP07-89 – North Welda CP07-89 – North Welda StorageStorage
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Protests were filed and eventually withdrawn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
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 5/9/08Approved redefining caprock
Approved enhancing recycle system
Denied lateral expansion of boundary
SSC requested rehearing/clarification of lease acquisition rights – Approved 8/6/08
CP08-4 – South Welda CP08-4 – South Welda StorageStorage
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
Fuel Filing RP07-96Fuel Filing RP07-96
Fuel Filing RP08-84Fuel Filing RP08-84Southern 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
Limited Waiver Filing Limited Waiver Filing RP08-443RP08-443
Southern Star Central Filed 7/11/08
PurposeWaive 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
Rate Case - RP08-350Rate 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
Rate Case - RP08-350Rate Case - RP08-350
Cost of ServiceRP04-276 RP08-350
Settled Filed
Storage 20.1$ 34.2$
Production Area 80.1 106.2
Market Area 77.8 117.0
Total COS 178.0$ 257.4$
Rate Case - RP08-350Rate Case - RP08-350
Storage RatesRP04-276 RP08-350
Settled Filed Increase
FSS - Deliverability 0.0218$ 0.0371$ 0.0153$ FSS - Capacity 0.0010$ 0.0018$ 0.0008$ FSS - Injection 0.0077$ 0.0116$ 0.0039$ FSS - Withdrawal 0.0077$ 0.0116$ 0.0039$
ISS - Capacity 0.0020$ 0.0036$ 0.0016$ ISS - Injection 0.0077$ 0.0116$ 0.0039$ ISS - Withdrawal 0.0077$ 0.0116$ 0.0039$
Rate Case - RP08-350Rate Case - RP08-350
Firm Transportation RatesRP04-276 RP08-350
Settled Filed Increase
FTS-P - Reservation 0.1974$ 0.2682$ 0.0708$ FTS-P - Commodity 0.0065$ 0.0080$ 0.0015$ FTS-P - Commodity Bal. 0.0012$ 0.0009$ (0.0003)$
FTS-M - Reservation 0.1139$ 0.1705$ 0.0566$ FTS-M - Commodity 0.0050$ 0.0049$ (0.0001)$ FTS-M - Commodity Bal. 0.0012$ 0.0009$ (0.0003)$
Rate Case - RP08-350Rate 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
Rate Case - RP08-350Rate Case - RP08-350
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
Motion RateMotion Rate FilingFiling
Rate Case - RP08-350Rate Case - RP08-350
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.
Next Settlement ConferenceNext Settlement Conference
Gary HinesGary HinesManager - Gas Manager - Gas ManagementManagement
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Gas Management UpdateGas Management Update
Storage Inventory & Fall Shut-In Tests
Remaining 2008 Planned Maintenance
Upcoming 2009 Planned Maintenance
Weather
Gas Quality Waivers
National EIA – 5 Year National EIA – 5 Year ComparisonComparison
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.
SSC Storage EIASSC Storage EIA
Current Storage Status42Current 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…”
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Remaining 2008 Planned Remaining 2008 Planned MaintenanceMaintenance
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???
HDD & CDD for YTD vs. Averages
Current Gas Quality Current Gas Quality WaiversWaivers
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
Dale Dale SandersSanders
Contract AdministrationContract Administration
Order 712
Issued June 19th, 2008
Major modifications to regulations for Cap. Release
Highlights
Price caps removed on Short Term Cap. ReleasesAsset Management Arrangements
(AMA)
Reminders
Change in Customer Look-up on Capacity Release Offer Screens
Reminders
Unique Usernames and Passwords
Reminders
Password Resets
Pre-Approved Bidders List
David David BristowBristow
Manager Scheduling & BillingManager Scheduling & Billing
33
Operational Flow Order (OFO)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 FTSPoint 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 contactAll customers must have an OFO contact
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Operational Flow Order Operational Flow Order (OFO) (cont’d)(OFO) (cont’d)
Categories of OFO’s:Standard
Preventative Action to neutralize and/or reduce threats
EmergencyImmediate Action needed to neutralize and/or prevent threats
35
Operational Flow Order Operational Flow Order (OFO) (cont’d)(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
Jim NeukamJim NeukamManager – Customer Services Manager – Customer Services
& Business Development& Business Development
Customer Services & Business Development Goals & 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
Customer Services & Business Development Goals & Objectives (Cont.)
Gas Supply & InterconnectsIdentify, evaluate, and pursue enhanced gas supply opportunities
Manage Customer Interconnect Process
Research and assess gas supply studies to ensure adequate gas supply
Customer Services & Business Development Goals & 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
Gas Supply Update – 2008 - 2009 Incremental VolumesLocation Name Location Line Segment
County/StateDesign dth/d
In-Service
Superior Pipeline – Hemphill Upgrade
16820
Alva
458 - Hemphill, TX 50,000 July 2008
DCP Midstream - Cimarron
15253
Alva
458 - Woodward, OK 65,000 November 2008
Dart Cherokee - Independence
16941
Independence
117 – Montgomery, KS
20,000 November 2008
Noble Energy – Big Timber
16942
Colby
490 – Cheyenne, OK 60,000 December 2008
Frontier Field Services - Antelope
Hills
16945
Alva
458 - Hemphill, TX 20,000 December 2008
Bluestem – North Housel
16935
Independence
260 - Labette, OK 15,000 November 2008
Bluestem – Jayhawk Upgrade
16872
Independence
495 – Wilson, KS 30,000 1st Quarter 2009
Currently there are nine other projects being assessed as viable new supply points or in pre-construction phases.
Available ServicesWinter 2007–2008
Production Area Firm & Interruptible Transportation
Market Area Interruptible Transportation
Park and Loan Service
Interruptible Storage Service
Winter Capacity Status (Markets) Kansas City Metro & North of Ottawa
LS 90, 115, 145, 180, 190, 250100% Subscribed
WichitaLS 120 & 333100% Subscribed
East of GrabhamLS 215, 225, 260,
423, , 450, 455100% Subscribed
Winter Capacity Status (Production)
Rawlins-HesstonLS 490, 491
100% Subscribed
West OklahomaLS 315, 377, 458
Potential Opportunity
West KansasLS 130
Potential Opportunity
South OklahomaLS 380, 400, 385
Select Opportunity
Grow our ServicesAccess 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
PhilipPhilipRullmanRullman
Director, Commercial Director, Commercial ServicesServices
2008 Customer Satisfaction Survey
Results
Survey Focus Items
Overview of Results• Quality of Service• Quality of Communications• Quality of Operations• Product Related Services
Comparison of Importance & Performance
Overview of Results
ImportanceAverage importance: 9.1
Range from 8.3 to 9.9
PerformanceAverage performance: 8.8
Range between 8.3 to 9.5
Key Survey Question
Southern Star communicates with you in an honest and forthright manner
Importance – 9.9
Performance – 9.5
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
CSI Action ItemsPark & Loan Services“As far as their Park and Loan contracts are
concerned, they are not very flexible. They’re pool specific and it’s very difficult to make changes on their system”
Action Items
Modify PLS service to allow all production area pools on a contract
Completion - End of the 1st qtr 2009
CSI Action ItemAuto Renom“I would like Southern Star to offer auto-
renomination. They need to have it…..”
Action Item
Assess requirements of auto-renom with customers by end of 1st qtr 2009
Project Plan has been developed but does one size fit all?
Completion pending scope refinements
CSI Action ItemCSI Time-Outs“My biggest issue is the lack of notification of time-
outs and such. The system should not allow you to put nominations in if it’s already timed out….”
Action ItemsCSI will provide customers a warning message prior to their CSI session expiring.
When a customer’s session has expired, CSI will redirect their web browser to a timeout error screen with an option to log in again.
Completion – Late 2nd qtr 2009
Mark your calendars… Spring Customer Meeting, April 23, 2009, Sheraton Kansas City
Sports Complex, Kansas City MO
