Petal Gas Storage, a subsidiary of Crystal Gas Storage Inc., hasfiled with FERC to build a 64.2-mile, 36-inch pipeline to accessexpanded capacity at its Mississippi salt cavern storage facilityand make deliveries under a new, large, long term storage contractwith Southern Company Services (SCS).

Construction plans include 5.5 miles of 36-inch storage headerloop alongside the existing 20-inch storage header, a new 20,000 HPcompressor station and 58.7 miles of 36-inch bi-directional pipefrom a point adjacent to Tennessee Gas Pipeline near Hattiesburg,MS to a Destin Pipeline meter station. Targeted completion date isMay 31, 2001.

The pipe will be used to deliver the 700,000 MMBtu/d of firmtransportation to delivery points on Transcontinental Gas PipeLine, Southern Natural Gas and Destin for SCS.Southern Companyhas contracted for 7 Bcf of storage capacity at the Petal facility.The company said the storage expansion and pipeline are needed “tomeet new demand for natural gas storage deliverability to supportgrowth in the gas-fired electric generation market in the southeastUnited States.”

Petal currently has one cavern operational with 3.2 Bcf ofworking gas capacity and is leaching another to match it. Thatprocess should be completed in about 14 months. The company hasapplied to the Federal Energy Regulatory Commission for approval toexpand the two storage caverns to 5 Bcf each of working capacity toaccommodate the Southern contract. The capacity and injection andwithdrawal provisions of that contract will enable Southern to turnover the storage capacity every 30 days if necessary. Southern willrequire all the firm capacity on the pipeline, Petal said. Thewhole project, including the work in progress, the expansion of thetwo caverns and the pipeline, is expected to cost about $120million.

Petal has requested extension of its current authorization formarket-based storage rates for the storage expansion and is filingfor negotiated rates for transportation with traditional cost-basedrecourse rates. The company said the expansions will make itpossible to serve all its current customers, as well as Southern.Further, it will not affect other pipelines in the area since themarket demand “represents new demand related to Southern CompanyService’s movement toward greater reliance on gas-fired electricgeneration.”

Ellen Beswick

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