The second phase of the liquefaction project at Southern LNG Co.'s Elba Island LNG Terminal near Savannah, GA, has been given the go-ahead by Shell US Gas & Power LLC. Elba Liquefaction Co. LLC was told to proceed by the Royal Dutch Shell plc subsidiary, El Paso Pipeline Partners LP (EPB) said. EPB's Southern Liquefaction Co. owns 51% of Elba Liquefaction (see Daily GPI, Jan. 29). Capacity to be added in Phase II will range from 70 MMcf/d (0.5 million tonnes per year) up to 140 MMcf/d (1.0 million tonnes per year). The estimated capital expenditure of Phase II at the maximum volume of 140 MMcf/d is about $500 million. Phase I of the project, consisting of six liquefaction units, will provide 210 MMcf/d of export capacity and is expected to be in service in late 2016 or early 2017. Phase II, covering two additional liquefaction units, has an expected in-service in 2017-2018. If the maximum volume for Phase II is elected, the Elba liquefaction project is expected to have total capacity of 350 MMcf/d (2.5 million tonnes per year) of LNG. The project was announced in early 2013 and will use Shell's small-scale liquefaction units. The project is currently in the Federal Energy Regulatory Commission review process.

Rapid City, SD-based Black Hills Corp. said Colorado regulators have verbally approved a settlement among the company's Black Hills Energy utility subsidiary, Colorado Electric, regulatory staff and various stakeholders for the utility's electric resource plan filed earlier this year. The action includes approval for the utility building a 40 MW natural gas-fired generation plant to replace a small coal-fired plant that will be retired. The approval from the Colorado Public Utilities Commission supports the state's 2010 Clean Air/Clean Jobs Act, which called for closing older fossil fuel generation plants and replacing them with a combination of gas-fired and renewable energy projects. As part of that effort, the Black Hills' Colorado utility suspended operations at a 42 MW coal-fired plant in Canon City, CO, last December and will close it Dec. 31, replacing it in 2017 with a new 40 MW simple-cycle gas-fired plant. It also is planning the retirement of two 60-year-old gas-fired generation units at its Pueblo, CO, generation complex.