Motion of Duke Energy Trading and Marketing, L.L.C. and Duke Energy Marketing America, L.L.C. for Leave to Intervene under RP05-385.

INTRODUCTION CHAPTER 1 Non-Internet Public FINAL ENVIRONMENTAL IMPACT STATEMENT FOR THE PROPOSED ENTREGA PIPELINE PROJECT Docket Nos. CP04-413-000, et al. Page 1-2 Figure 1.1-1 Public access for the above information is available only through the Public Reference Room, or by e-mail at public.referenceroom@ferc.gov. Local Natural Gas Shipping Demand and Committed Pipeline Capacity (1) Historical Supply (2) Forecasted Supply (3) Year (1) Natural Gas Shipping Demand and Committed Pipeline Capacity Historical demand from EIA; Committed pipeline capacity from EnCana Oil & Gas (USA) Inc. (2) Historical Supply Wellhead Supply from Lippman Consulting Inc. (February 2004) and assumed 15.97% average gathering and processing fuel, loss and shrinkage. (3) Forecasted Supply from PACE Global Energy Services Wyoming Pipeline Study (February 2003). Source: Entrega, FERC Application, Exhibit H. Figure 1.2-1 Rockies Natural Gas Supply vs. Local Natural Gas Shipping Demand and Committed Pipeline Capacity 1-4 1.0 INTRODUCTION 1.2 Project Purpose and Need The purpose of the EPP is to transport natural gas from supply basins in the central Rocky Mountains to interstate shippers at Wamsutter and the Cheyenne Hub who would carry the gas to markets either in the West, the Midwest, or the Central United States (U.S.), depending on the delivery location specified by the shipper.3 The need for the project is dictated by an increasing natural gas supply (production) in the Rocky Mountain region, which is occurring without a concurrent increase in pipeline capacity to transport this gas out from the production basins and into the interstate pipeline network. Rocky Mountain region (New Mexico, Colorado, Wyoming, Utah, Montana) gas production is predicted to increase from 3.3 trillion cubic feet per year (Tcfy) in 2002 to 4.6 Tcfy in 2010 and 6.3 Tcfy in 2025 (U.S. Department of Energy [DOE] 2004). This mirrors the 2003 National Petroleum Council estimate that by 2020, Rocky Mountain production will grow by 50 percent. This increase in production will offset declining production in other U.S. gas producing regions. The Energy Information Administration (2005) estimates that the Rocky Mountain region will make up 38 percent of the nations lower-48 natural gas production by 2025, up from 27 percent today. Entrega forecasts that from 2004 to 2010, Rocky Mountain region production (not including the San Juan Basin) will increase by 3.7 Bcfd to 10.3 Bcfd. Pipeline exit capacity is not expected to match the increase in gas production over this time period. Figure 1.2-1 illustrates Entregas estimate of the relationship between the Rocky Mountain region gas supply increase and committed pipeline capacity. As shown, Entrega estimates that there will be a shortfall ...