EnCana Inks Deal for Capacity on Proposed Rockies Express Pipeline

Kinder Morgan Energy Partners, says that EnCana Marketing (USA), a subsidiary of EnCana Corporation, has signed a binding precedent agreement for 500 million cubic feet per day (MMcf/d) of natural gas capacity on the proposed Rockies Express Pipeline. The agreement was signed in conjunction with an open season currently under way on the Rockies Express project.

The approximately 1,350-mile, 42-inch diameter, 2 billion cubic feet per day (Bcf/d) Rockies Express Pipeline will be the largest pipeline built in the United States in more than 20 years. The planned route of the pipeline originates at the Cheyenne Hub in Weld County, Colo., and extends to the Clarington Hub in eastern Ohio.

"The commitment from EnCana, one of North America's largest natural gas producers, demonstrates the necessity and viability of the Rockies Express Pipeline project, which will provide a solution for delivering long-life, domestically produced, natural gas to the Midwest and Northeast, thus maximizing the value of growing Rockies production," said KMP Chairman and CEO Richard D. Kinder. "We are confident that EnCana's support, along with previously announced conditional commitments for another 400 MMcf/d from the Wyoming Natural Gas Pipeline Authority and an affiliate of Sempra Pipelines & Storage, will help drive the Rockies Express project forward and result in additional firm capacity commitments during the open season." Depending on regulatory approvals and additional shipper commitments, the Rockies Express Pipeline is anticipated to begin service in late 2007.

Additionally, the Kinder Morgan-Sempra Pipelines & Storage project group today announced it has entered into a purchase and sale agreement with EnCana for its KMP-operated subsidiary, Entrega Gas Pipeline Inc. Entrega is in the process of constructing the first segment of the 330-mile project, which extends from the Meeker Hub in Rio Blanco County, Colo., to the Wamsutter Hub in Sweetwater County, Wyo. Under the terms of the purchase and sale agreement, anticipated to close in the first quarter of 2006, the Kinder Morgan-Sempra Pipelines & Storage team will construct the second segment of the project, which extends from the Wamsutter Hub to the Cheyenne Hub, where it will ultimately connect with Rockies Express. It is anticipated that the entire Entrega system from the Wamsutter Hub to the Cheyenne Hub will be placed into service by the end of 2006. A separate binding open season is now under way seeking shipper support for an extension of Entrega from the Wamsutter Hub to the Opal Hub in Lincoln County, Wyo., that will make up to 1 Bcf/d of additional capacity available on Entrega. Shipper support is also being solicited for a proposed expansion of the currently certificated Entrega facilities. The expected in-service date of the extension or expansion is late 2007; however, interim service could be available prior to that date.