Bay Gas Storage Company Ltd. said it will conduct an open season to assess interest in the expansion of its natural gas storage facilities located near Mobile, AL. The company said the open season, which began last week, will run until Jan. 17.

The EnergySouth Inc. subsidiary is the easternmost salt-dome storage facility in the region. Currently, the facility consists of a single 2.2 Bcf (working gas) cavern, with direct connections to Florida Gas Transmission, Gulf South Pipeline and Mobile Gas Service Corp. A second cavern is set to go into service in April at a size of 2.5 Bcf. Expanded surface facilities were completed Nov. 30, increasing total injection and withdrawal to 225 MMcf/d and 610 MMcf/d, respectively.

“We are substantially complete with Phase I of our second cavern,” said John S. Davis, CEO of EnergySouth. “While that capacity is fully subscribed, the open season will help us quantify interest in Phase II capacities and third-cavern development.”

First announced in July of 1999, Bay Gas expected to have Cavern Two operational by December 2002, and fully operational by March 2004 (see NGI, July 12, 1999; Dec. 4, 2000).

Calling the storage project location uniquely attractive, company President Gregory H. Welch said, “Our close proximity to both Gulf of Mexico production and the growing market for that gas in the southeastern United States make us a natural choice for customers who need high-deliverability storage.”

Bay Gas said it is currently approved by FERC for “market-based” rates and will seek similar treatment for any expansion.

For additional information on the open season, contact Greg Welch at (251) 450-4749 or email at gwelch@bay-gas.com. More information is also available at www.bay-gas.com.

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