II. Background
SoCalGas filed its application with the Commission on April 9, 2001. The application described how SoCalGas planned to make design changes at its Aliso Canyon and La Goleta underground gas storage fields through a combination of the drilling of new wells and reworking several existing wells. According to the application, the redesign of these storage fields will allow SoCalGas to provide the same level of current deliverability with less cushion gas at both fields. SoCalGas estimates that 14 Bcf of cushion gas will no longer be needed, which can then be reclassified and sold on the open market.
D.01-06-086 authorized SoCalGas to perform the redesign work on the two storage fields, and after the well drilling and associated work is completed, SoCalGas is authorized to reclassify 7 Bcf of cushion gas at Aliso Canyon and 7 Bcf of cushion gas at La Goleta as working gas available for sale. The decision also authorized SoCalGas to sell the reclassified gas "on the terms and conditions specified in a future Commission decision." (D.01-06-086, p. 37.) The decision also stated that there would be a second phase of this proceeding to address all of the remaining ratemaking issues, "including the allocation of the anticipated net gain on sale of the reclassified cushion gas, the anticipated reduction in prospective operating costs, and the allocation of benefits among customer classes...." (D.01-06-086, p. 32.)
Ordering paragraph 2 of D.01-06-086 solicited opening and reply comments on whether any restrictions should be imposed on SoCalGas with respect to the sale of the 14 Bcf of reclassified cushion gas, the advantages or disadvantages of the various proposals to restrict the sale of the reclassified cushion gas, and whether Phase 2 of this proceeding should be handled in SoCalGas' Biennial Cost Allocation Proceeding (BCAP).1
Opening comments were filed by SoCalGas, the Office of Ratepayer Advocates (ORA), and the Southern California Generation Coalition (SCGC). Duke Energy North America and Duke Energy Trading and Marketing (collectively "Duke Energy") also filed joint opening comments. Reply comments were filed by SoCalGas, ORA, and The Utility Reform Network (TURN).
Pursuant to Ordering Paragraph 1.g. of D.01-06-086, SoCalGas has filed its monthly reports to keep the Commission informed about the status of the drilling work, and to provide a summary of the costs incurred to date.
1 SoCalGas filed its BCAP application (A.01-09-024) with the Commission on September 21, 2001.
