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FERC Approves 17 Bcf Storage Facility in Mississippi

FERC Thursday granted Mississippi Hub LLC a certificate to build a 17.34 Bcf salt dome natural gas storage facility and an associated pipeline in South-Central Mississippi. The agency also approved the company's request to charge market-based rates for storage services.

The proposed storage facility would consist of two 8.67 Bcf caverns, with a combined working gas storage capacity of 12 Bcf. The storage facility would be capable of delivering natural gas at a rate of approximately 1.2 Bcf/d, and would have a maximum injection rate of 600 MMcf/d. The facilities would be built on an 80-acre parcel of land owned by Lafayette, LA-based Mississippi Hub in Simpson and Jefferson Davis counties, MS.

The storage site would be located "at a strategic point between new sources of natural gas supply being developed in Texas and Louisiana and in offshore areas of the Gulf of Mexico and the growing markets in the eastern United States, including the Southeast and Mid-Atlantic regions," the FERC order said [CP07-4].

The company also plans to build a 11-mile, 36-inch diameter pipeline to deliver gas volumes to and from the proposed storage facility. Bidirectional pipelines would connect the storage facility with two interstate pipelines, Southern Natural Gas and Gulf South Pipeline, as well as intrastate pipeline Crosstex Energy.

The start-up of the proposed storage facilities would coincide with the proposed in-services dates of certain Gulf Coast liquefied natural gas import terminals, the company noted.

The project will be constructed in two phases, according to market timing and demand, Mississippi Hub said. An estimated 4 Bcf of storage capacity is expected to be in service by August 2008, but the entire project won't be done until 2010, a spokesman noted.

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