The storage-poor Pacific Northwest could get some needed reliefin the near future. Avista Corp. and PG&ampE GasTransmission-Northwest (PG&ampE GT-NW) have joined forces toinvestigate building another underground natural gas storagefacility in an aquifer in eastern Washington near theinterconnection of PG&ampE GT-NW and Williams (Northwest Pipeline)at Stanfield, OR.

Avista’s Patricia Grable said it is premature to speculate onwhat the ultimate deliverability or capacity of a new project couldbe. But Avista Corp. CEO Tom Matthews said it could prove “ofsimilar value [as Jackson Prairie] to our company in the future.”

Avista is part owner with Williams of the Jackson Prairieunderground storage facility in western Washington, which currentlyis undergoing an expansion to 18 Bcf of working gas capacity from15 Bcf and to 850 MMcf/d of deliverability from 550 MMcf/d. Theonly other storage facility in the region is Northwest NaturalGas’s Mist (OR) facility 50 miles northwest of Portland. Mist alsois rolling out the first part of an eight-year, $122 millionexpansion this year. The first phase will increase working gascapacity at Mist to 8.5 Bcf from only 6.5 Bcf and will raisedeliverability to 125 MMcf/d from 80 MMcf/d.

New demand records set this winter in Northern Californiademonstrate the need for greater access to gas supply, according toPG&ampE GT-NW President Thomas B. King. Pacific Northwest gasdemand growth, which has been averaging a strong 5%/year throughoutmost of the 1990s, isn’t showing signs of letting up. “We areexploring various alternatives to best meet the need for additionalnatural gas supply in the Pacific Northwest, including both gasstorage and new pipeline capacity,” said King. “This currentagreement will help us determine the economic viability of newstorage development in areas accessible to both Northwest andCalifornia markets.”

Avista and PG&ampE GT plan to begin drilling and geologictesting of the site during the second quarter. “The testing programwill provide the additional information we need to determinewhether it is in the economic interest of our company and itsshareholders to continue to participate in the development of thissite over the next three to four years,” said Matthews.

PG&ampE GT and Avista also may face some additional storagecompetition in the region in the near future. Western HubProperties LLC (WHP), which is developing the Lodi Gas Storageproject near Lodi, CA, announced last fall that it too wassearching for locations to develop up to four newhigh-deliverability gas storage hubs in the Pacific Northwest overthe next five years. The company still has not announced any ofthose locations, however.

Competition will be “limited by the geology,” said Peter Lund,vice president of gas transportation and storage of PG&ampE GT.”There just isn’t that many great sites up here. We hope we’ve gotone here. The geology is basically volcanic rock. It’s not likeTexas or Louisiana where you have a lot of spent gas fields andsalt dome capability. There’s a lot of demand for storage butthere’s not a great deal of identified sites at this point in time.

“We generally canvassed the Northwest and chose this location asthe one that has the most strategic potential from the standpointof the right geology and proximity to the pipeline system. For allintents and purposes it’s at Stanfield.

Lund said if the project gets the green light storage operationsprobably would begin in four or five years.

Rocco Canonica

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