2016 Millennium Shipper Meeting Welcome Joe Shields Vision To - - PowerPoint PPT Presentation

Connecting communities to cleaner energy

Welcome– Joe Shields

2016 Millennium Shipper Meeting

Vision

• To become the premier pipeline in the Northeast
• To attain the highest customer service rating
• To attain the highest reliability rating
• To bring added value to customers contracts
• To provide quality staffing to meet our customer’s needs

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Our vision is to provide you with the best customer experience

2016 In Review

• TransCanada Pipelines acquires Columbia Pipeline Group
• Millennium ownership interest is unchanged
• TransCanada – 47.5%
• DTE – 26.25%
• National Grid – 26.25%

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Ownership change is transparent to your service

2015 Customer Survey Actions

• Increased communication through customer newsletter and

customer conference calls

• New and additional staff
• On-going and direct communications with the Navigates team

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We use your feedback. Please continue to participate in the survey process.

Millennium Organization

Joe Shields - President Ron Happach – Chief Operating Officer Mike Armstrong Director – PM Randy Parker – Project Mgr Bruce Page – Project Mgr Patrick Riban – Mgr System Design Steven Leggett – Project Acct Rick Gardner – SVP Business Development Michelle Brocklesby – Director Optimization Riochi Giles – Business Analyst Jeff Reavis – Mgr Optimization John Keith – VP Finance & Controller Audrey Bottari – Executive Admin Asst Cynthia Castro – Staff Accountant Georgia Carter – VP & General Counsel Christina Woodward – Records Mgmt Michelle Hook – Director Outreach Erin Fennell – Executive Marketing Assistant

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2016 Customer Survey

• 2016 Energy Insights Customer Survey conducted by Wayne Rechnitz
• 90% participation rate
• Thank you to all those who took the time to provide feedback
• This is the best tool we have to measure how well we are meeting customer needs
• 70% of the participants agree that Millennium Pipeline provides exceptional service, 1%

disagree

• 78% of the participants agree that Millennium Pipeline is committed to improving its

customer relationships, no one disagrees

• 53% of the participants agree that Millennium provides better service than other pipelines,

up from 27% percent last year

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We have listened to feedback and strive to improve

Customer Survey Results

Connecting communities to cleaner energy 7 Mid/ Bk Office Noms & Sched/ Navigates Senior Mgnt/ Biz Dvlpmnt General Commercial Overall Average Gas Control 8.3 8.0 7.7 7.6 8.0 8.2 8.0

2014 2015 2016

2016 Themes – Opportunities for improvement

• A stronger relationship between Millennium and its interconnected pipelines is desired
• Better communication about operational challenges
• Confusion on cuts
• Reliability and lack of flexibility
• Intraday cuts impact production
• Less flexibility on where gas can be shipped
• Navigates
• Improved, but information is difficult to obtain
• Confusion in regards to cuts
• Concern over viability of expansion projects given the regulatory climate
• Customers are willing to help in any way possible
• Expansions are critical to customer success

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The Millennium team is developing a plan and will report back in the newsletter

Ron Happach

Operational Update

O&M Construction Projects

• Major 2016 Mainline Work - Completed
• Corning CS – Turbine replacement
• Minisink CS – Additional station piping testing, installation of vessels and station valving
• Hancock CS – Turbine repair and maintenance
• Major 2016 Mainline Work – Still Remaining
• Potential cleaning pig run from Corning to Bush Hill to coincide with major work at Bluestone
• Major 2017 Planned Mainline Work
• Add Launcher / Receiver near Stagecoach Interconnect
• Reduces run time for pigging activities
• ILI Runs
• Corning to Bush Hill
• Westtown to Ramapo
• Minisink turbine change-outs (2 units)

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Reliable Firm Service

• Customers experienced ONE interruption in service
• 60,000 dth impact to eastern deliveries
• Outage due to:
• Scheduled maintenance at Minisink
• Unplanned outage on another pipeline

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Firm service has been reliable – flexibility has presented a challenge

“The 24” Pipeline Section”

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Four Year Supply History

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Supply continues to increase, bringing value to Millennium shippers

Four Year Interconnect History

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2015/2016 Winter Flow Summary

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Direct connected markets average ~200 MM

2016 Summer Flow Summary

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Direct connected markets average ~165 MM

Michelle Brocklesby

Commercial Update

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Customer Service Reorganization

• MPC Customer Service team
• Missy McNamara
• Teri Pollack
• Ebere Bolton
• Contracts
• Keri Crawford
• Gas Control
• Charleston, WV

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Navigates Changes

• Nov 2015
• Gas/electric coordinate background

processes

• Begin phased implementation of point

consolidation (one receipt/delivery point)

• Scheduling process improvements
• 2016
• Point consolidation completed
• Pool tolerances set to zero

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Firm Transportation

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• Ramapo capacity

provides flexibility for Wagoner deliveries

Three Year IT History

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Significant drop in IT volumes 2015 to 2016

Factors impacting IT

• Warmer winter
• Higher load factor on

firm capacity

• AIM construction
• MPC maintenance

Two Year East Pool Volume History

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East pool liquidity on the rise in 2016

Tariff Changes

• Fuel
• April 1 - Retainage rate of 0.512% established
• September 1 - Zero fuel rate becomes effective
• We continually evaluate fuel retention
• The expectation is that it will be returned to approximately the same rate (0.512%)
• Clean Up
• Clarifications to the sale and purchase of operational gas
• Negotiated commodity, fuel, and surcharges for capacity releases
• Discretionary waivers
• Coming soon –
• Section 4 restructuring
• All concepts have had support and have been approved by FERC on other pipelines such as Columbia Gas

Transmission

• Providing more flexibility for contracting available capacity
• Lining up MPC’s Section 4 with other previously accepted Section 4s
• Mapping of changes coming soon
• Spot pricing
• New rate schedules – LFT (lateral firm transport), LIT (lateral interruptible transport)
• Customer meetings, conference calls to discuss all filings

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Our goal is to make it easier for customers to conduct business

Available Capacity

• November 1 - West side capacity available
• 42,500 dth/day Stagecoach to Empire
• 50,000 dth/day Stagecoach to Dominion
• 10,000 dth/day Stagecoach to Arlington
• April 1 - West side capacity available
• 10,000 dth/day Stagecoach to Empire
• As we did this past year – review ability to delivery additional capacity to Holding

Point

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If interested in available capacity – please contact Michelle Brocklesby

Rick Gardner

Business Development

Valley Lateral Project Description

• 7.9 Mile 16” Lateral to CPV’s

Proposed 650 MW Combined Cycle Power Plant

• Reduces regional dependency on older

less efficient power plants

• Improves electric pricing for New York

energy consumers

• Competitive Power Ventures is the

sole customer

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New market directly attached to Millennium – up to 127,200 dth/d

Valley Lateral Project Regulatory Status

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• We anticipate a FERC order on Valley

Lateral in October

• Construction will be conditioned on receipt of

Clean Water Act authorizations

• NYSDEC decision on MPC’s 401 Water

Permit due by Nov. 23, 2016

• We have met all Clean Water Act standards
• Valley Lateral Project vs Constitution
• Also greenfield, but much smaller - 7.8 miles of

16-inch pipeline

• Will cross most streams and wetlands by

trenchless method

• Will serve gas fired generation facility that

received air/clean water permits from NYSDEC

ESU Project Overview

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Eastern System Upgrade (ESU)

• Increases capacity between Corning and Ramapo by

approximately 220,000 Dth/day

• Customers are Northeast Utilities
• Customers are seeking diversity of supply
• Increased supply at Ramapo benefits both New York

and New England energy consumers

• Ramapo is a major supply point for New York State

utilities and power plants

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Millennium will be posting the remaining capacity shortly – 20,500 Dth

Outlook for ESU Project

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• FERC Authorizations
• Filed July 29, 2016 after six months in pre-filing;
• July 2017 approval requested.
• Initial comments on ESU at FERC relatively light.
• NYSDEC Authorizations
• Need air and 401 Water Permits from NYSDEC.
• NYSDEC must act on MPC’s 401 Water Permit by July 2017.
• No statutory deadline for action on air permits.
• ESU vs Constitution
• 7.8 miles of looping along existing ROW
• Adding compression at existing station; also constructing new station
• Market pull

ESU Highland Compressor Station

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Millennium strives to be a good neighbor, >.5 mile to nearest residence

Other Potential Projects

• Additional deliveries to Ramapo based on customer demand
• Ability to construct an incremental 300,000 Dth/d at approximate system rate
• Expand interconnect with Dominion at Holding Point
• Preliminary investigation
• Changes in piping, addition of filter separator
• Estimated capital is within our blanket FERC authority
• Capacity 100,000 Dth/d
• Expand interconnect with Empire at Corning
• Preliminary investigation
• Change in piping
• Estimated capital is within our blanket FERC authority

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Millennium strives to provide cost-effective supplies to the market

Break

Georgia Carter

Regulatory Update

We Operate in Interesting Times

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• FERC at a crossroads
• Under fire from environmentalists
• Down to three Commissions
• Two Republican vacancies
• Impacts of a new administration?
• Natural gas facing political challenges in NY
• Will air and water permits be issued?
• What is happening with the Constitution litigation?
• At issue: How broad is a state’s authority under the Clean

Water Act?

• What does this mean for Millennium projects?

NY Regulatory Environment for 2016 Projects

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• Difficult year in New York for natural gas projects.
• NYSDEC rejected Constitution’s 401 Water Permit on Earth Day.
• Constitution immediately appealed the NYSDEC rejection to the 2nd

Circuit.

• Briefs filed in September & October; oral argument set for Nov. 16.
• NYSDEC has not acted on air permits for Iroquois & Dominion

projects

• Both have had FERC approval for months.
• No deadline for states to act on Clean Air Act applications.
• NGA gives pipelines a remedy at the DC Court of Appeals for a

state’s failure to act.

• Iroquois has filed at DC Court of Appeals to compel NYSDEC action
• Dominion has not pursued a remedy in court at this time.
• Uncertainty over 401 Water Permits pending at NYSDEC.
• Clean Water Act requires state action no later than 1 year after

application.

• NYSDEC decision on Algonquin’s Atlantic Bridge 401 Water Permit

due 11-18-16 and on MPC’s Valley Lateral Project on 11-23-16.

• The next 12 months will tell us a lot.

John Broyles

New York ISO

Questions on any topics?