Petal Extends Open Season For Storage Expansion
At the request of potential new shippers, Petal Gas Storage
L.L.C. has extended by three weeks its open season to determine
whether there's enough market demand for further expansion of its
two storage caverns in Mississippi.
The open season, which was scheduled to end April 14, has been
extended until May 5, at which time Petal will assess whether
there's sufficient interest to add another 5 Bcf of working gas
capacity by leaching a third cavern, said Vice President David
Hayden. If there is, he noted Petal would seek FERC approval of the
project later this year with project completion targeted by June
"We feel very good about the [open season] results so far," he
noted, adding that "numerous potential customers" have expressed an
interest in acquiring storage capacity, but they want "more time"
to make their final decision.
Petal kicked off this latest open season within days after FERC
approved an expansion to boost the working gas capacity of the
storage company's two Mississippi facilities to 10 Bcf by the
scheduled in-service date of June 2001 (See NGI, March 27, 2000).
In the meantime, controversy continues to swirl around Petal's
pending application at the Commission that seeks to add 500 MMcf/d
of deliverability capacity to the storage company's existing
capacity of about 320 MMcf/d by mid-2001.
Southern Company, which signed up for much of the expanded
storage volumes planned by Petal, now appears to be a strong
champion of the proposed deliverability expansion, even though it
has been amended to exclude three pipeline interconnects that Petal
had committed itself to in Southern's precedent agreement. Although
it previously expressed some reservations about the revisions,
Southern now has urged FERC to process the application as "quickly
Based on Southern's initial concern, Commission staff earlier
this month threatened to dismiss the deliverability expansion
project for a lack of market support unless Petal could prove
otherwise (see NGI, April 10)
Southern responded to staff's actions in a letter to FERC,
saying that it was fully behind the Petal project and had no plans
to withdraw. It "opposes the dismissal" of Petal's project.
Southern said the proposed deliverability project, which entails an
additional 20,000 horsepower of compression, a storage header loop
and an expanded interconnect with affiliate Tennessee Gas Pipeline,
was a "necessary complement" to Petal's storage-capacity expansion
that FERC approved.
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