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SMUD BOARD APPROVES MOJAVE CONTRACT

 SACRAMENTO, Calif., June 25 /PRNewswire/ -- The Sacramento Municipal Utility District (SMUD) Board of directors unanimously approved a long- term natural gas transportation agreement with Mojave Pipeline Company (Mojave) to anchor Mojave's proposed Northward Expansion Project.
 The agreement has a primary term of 15 years with rights of extension for another 15 years. It provides for a fixed rate over the life of the contract, escalated 1 percent annually, guaranteed by Mojave. The quantity covered by the agreement is 55 million cubic feet per day, about 12 percent of Mojave's planned capacity.
 Michael C. Holland, president and CEO of Mojave Pipeline Operating Company of Bakersfield said, "The SMUD Board's decision was absolutely critical to the success of our expansion project. Our firm rates, higher quality service and freedom from CPUC jurisdiction were the pivotal factors in SMUD's choosing Mojave."
 Mojave, now wholly owned by El Paso Natural Gas Company (EPG), filed an application with the FERC to construct and operate its Northward Expansion Project on March 17, 1993. It will have a capacity of 475 million cubic feet per day and cost approximately $468 million. It will serve manufacturing, industrial, cogeneration, and municipal utility customers in central and northern California.
 "Natural gas customers throughout northern California, from refineries to homeowners, have already felt the positive effects of the competition represented by our Northward Expansion Project. The SMUD Board wanted to approve this contract with Mojave so that these competitive benefits would continue and extend directly to their own ratepayers in the Sacramento area," Holland said. He described the project as a "major construction effort," with about $441 million in labor and materials to be invested in California. Approximately 4,000 jobs will be generated during construction and many thousands more will be positively impacted through the multiplier effect.
 -0- 6/25/93
 /CONTACT: Michael C. Holland of Mojave Pipeline Operating Company, 805-861-7300/


CO: Mojave Pipeline Company ST: California IN: OIL SU: CON

PS -- NY029 -- 5721 06/25/93 12:24 EDT
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Publication:PR Newswire
Date:Jun 25, 1993
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