NGI The Weekly Gas Market Report
A second merchant underground natural gas storage field inCalifornia proposed for a depleted gas field 20 miles south ofSacramento is awaiting a draft environmental report from stateregulators in September to stay on its current timetable forstart-up next Spring.
Texas-based Western Hub Properties LLC is proceeding with”serious discussions with a half-dozen prospective customers,”including a number of independent power producers, according to TomDill, president of Western Hub and its affiliated Lodi Gas Storage,noting that the majority of his prospective customers are lookingfor one- to three-year deals.
Dill said his firm has now “short-listed” prospectivecontractors to build a compressor station and 30 miles ofconnecting pipeline to hook on to the Pacific Gas and Electricbackbone transmission pipeline system. He expects to ink a dealwith one of the construction firms in the next two months, notingsome of the work could get under way late this year.
The proposed storage field is expected to have a 500 MMcf/dinjection/withdrawal capacity with 12 Bcf of working gas. It willinvolve 10 new wells, three new compressors and a 24-inch diameterpipeline to interconnect with the PG&E gas utility transmissionfacilities.
Western Hub proponents distinguish their proposed project fromCalifornia’s first merchant underground storage project thatstarted operations last spring-Wild Goose Storage, located about 50miles north of Sacramento and also interconnected with the PG&Esystem. The Lodi project expects to have greater volume and quickerinjection and withdrawal capabilities, according to Dill.
Lodi is “designed for more efficient daily and inter-andintra-month transactions,” he said.
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