Two storage developers have received the go-ahead from FERC on proposals to expand natural gas storage facilities in Alabama and Kansas.

MoBay Storage Hub LLC, an affiliate of Falcon Gas Storage Co. Inc., received an order, which amended a 2006 certificate, to increase the total capacity of its storage facilities in South Mobile Bay County, AL, by 3.70 Bcf to 86.74 Bcf, of which 59.61 Bcf will be working capacity [CP06-398].

MoBay proposes to install nine injection and withdrawal wells in addition to the 21 wells that already exist. Two of the wells will be installed at new offshore locations and seven at previously approved well caisson structure locations, the order said. All of the new wells will be within the North Dauphin Island storage reservoir.

The Federal Energy Regulatory Commission (FERC) approved MoBay’s request for market-based rate approval for firm and interruptible storage, hub and wheeling services.

Southern Star Central Gas Pipeline Inc. was issued a certificate to expand its storage capabilities at its Elk City storage field in Kansas [CP10-2]. The order raises the total capacity of the Elk City storage field by 2.6 Bcf to 33.3 Bcf, comprising 10.4 Bcf of working gas and 22.9 Bcf of base gas.

Southern Star said a recent study by Netherland, Sewell & Associates Inc. concluded that the total capacity of the Elk City storage field is 33.3 Bcf, which was 2.6 Bcf greater than the currently certificated maximum capacity. It proposed offering the entire 2.6 Bcf as working gas capacity and converting 1.4 Bcf of its base gas to working gas, which would have brought the total working gas capacity to 11.8 Bcf.

But the Federal Energy Regulatory Commission denied Southern Star’s request to convert the 1.4 Bcf base gas to working gas, saying it could create a potential long-term decrease in the capacity of the storage field. The agency’s rejection would not preclude the company from filing an application to amend its certificate at a later time, the Commission said.

“If Southern Star chooses to do so, it must provide technical justification, such as a reservoir simulation model, that reflects how the storage field must be operated in order to prevent the loss of storage capacity. In addition, Southern Star must discuss how, or if, its current tariff needs to be revised to ensure that the Elk City field is operated in a way that will not result in the loss of storage capacity,” the FERC order said.

As it did with MoBay, the Commission approved Southern Star’s request for market-based rate authority for storage services, subject to conditions.

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