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For immediate release: August 20, 2003
Media Contact: Claudia Chandler - 916-654-4989

Energy Commission says no to
petroleum pipeline from Texas to California


Sacramento - The California Energy Commission today adopted a report that recommends against building a pipeline to bring gasoline and other petroleum products to the State from refineries in Texas and the Gulf Coast.

The report, "Gulf Coast to California Pipeline Feasibility Study," was unanimously accepted at the Energy Commission's business meeting.

The study finds that the Gulf Coast area will not have enough supplies of the type of gasoline used in California to merit construction of the pipeline. The study does recommend that the Longhorn pipeline - now proposed for construction between Houston and El Paso, Texas - be completed, however. Once the Longhorn project is in place, the study encourages increasing the capacity of the pipeline from El Paso to Phoenix. Building additional pipeline capacity to Arizona, and adding a pipeline from Phoenix to Las Vegas, would allow those markets now dependent on California for fuel to receive more product from the Gulf Coast. Such a move would indirectly increase gasoline supplies for California.

"Today Arizona gets nearly 70 percent of its gasoline from California," said Energy Commissioner James Boyd. "By increasing the pipeline from El Paso to Phoenix, we can decrease Arizona's dependence on West Coast refineries and use our State's refinery capacity to make more California gasoline."

The El Paso pipeline, which carries gasoline, diesel and jet fuel, has been in the news since it ruptured in Tucson, Arizona, on July 30, 2003. The 8-inch diameter line, owned by Kinder Morgan, was shut down August 8, 2003. It normally carries 60,000 barrels of petroleum a day to Phoenix - nearly a third of the area's supply. Since the pipeline has been out of service, the Phoenix area has been hit by gasoline shortages, long lines at gas stations, and higher prices. California has responded by sending additional supplies. That move, coupled with refinery problems in California and in Washington, have caused gasoline prices to increase in the West.

The 16-page "Gulf Coast to California Pipeline Feasibility Study" was requested by Assembly Bill 2098 and is available on the Energy Commission's website at:

www.energy.ca.gov/fuels/pipeline/documents



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