CA Storage Field Completes Wild Ride
Calling his own merchant underground natural gas storage field
in northern California a "done deal," a Calgary-based Alberta
Energy official speculated that any competitors in developing
nonutility, market-based storage "have quite a bit of work to do"
to get a competing facility up and running. It was an indirect
reference to a smaller, competing facility whose backers say they
will file with California regulators Oct. 1. (See Daily GPI, Sept.
"We know how much work we had to do to get [our facility] up and
running," said Ben Ledene, marketing vice president for Alberta
Energy's Wild Goose Storage Inc.
"What others are talking about seems awfully aggressive." He was
referring to, but not naming specifically, the proposal by Western
Hub Properties LLC to have a competing merchant storage operation
in place by October 1999 even though its backers have not yet filed
with the California Public Utilities Commission. Wild Goose has
completed all of its major well drilling, pipeline and other site
work, with the only major construction remaining being the
installation in late winter of the permanent compression units
which have been tested at their manufacturer's facilities in Tulsa.
Temporary compressors have been used at the site to test existing
facilities and inject the initial cushion gas this summer, Ledene
said. About 12 MMcf/d of supplies for cushion gas are currently
being drawn off the PG&E transmission pipeline.
Wild Goose is a depleted dry gas field that is in the midst of a
pristine hunting preserve about 50 miles north of Sacramento. The
underground storage facility will offer 14 Bcf of inventory, with
firm withdrawal capability of 200 MMcf/d and injection of 80 MMcf/d
through four well (one vertical and three horizontal). An
18-inch-diameter, 4-mile pipeline will link the facility to Pacific
Gas and Electric's transmission pipeline (Line 167).
By comparison, Western Hub Properties is proposing to convert a
depleted gas field 20 miles south of Sacramento near the town of
Lodi to an underground storage facility with a 6 Bcf working
capacity and 200 MMcf/d injection and withdrawal capacities. (All
of those numbers may double, its backers said, if there is
sufficient customer interest between now and when the project gains
CPUC approvals.) Like Wild Goose, the Western Hub project is
seeking a negative declaration regarding environmental impact of
Wild Goose's Ledene said facilities at his company's project are
designed to "blend in with the surrounding environment," and the
wellheads are using water-tight marine equipment so storage
operations will not be affected by floods that occur regularly in
the winter and spring. The surrounding area is a wetlands and duck
habitat. "This is a pristine part of the country and we put in a
lot of extra work to make sure our facilities are going to work
well with the environment, " Ledene said.
Wild Goose is still working to more fully subscribe the capacity
of its facility, which was only partially subscribed after its open
season last fall. It is concentrating on signing smaller capacity,
one-year deals, Ledene said, adding that he won't give out customer
statistics, but he is also looking at some two- and five-year
"We'll look at almost any opportunity that comes along, but one
of our objectives this first year is to show as many different
companies the quality of service they will get from Wild Goose. And
if it means we give more people an opportunity to try out storage
for a year that is a good way to show people the advantage of
having a storage position.
"We're going to be building some electronic nomination systems
that we currently use at AECO (underground storage facility in
Alberta, Canada). Customers will be able to nominate via computer.
We have a lot of years of experience (in Canada) backing up Wild
Customers include marketers, producers and industrial customers.
"We've got a lot of interest right now. We have done a few deals in
the last couple of weeks and we have a lot more deals to do before
Christmas. It is a matter of letting people test drive a bit of
capacity," said Ledene, noting the deals will be in the 200 MMcf to
500 MMcf range.
Richard Nemec, Los Angeles