Chestnut Ridge Storage received authorization from FERC Monday for its 25 Bcf working capacity Junction Natural Gas Storage Project to be located in a depleted gas field in Fayette County, PA and Monongalia and Preston counties, WV.

Omaha, NE-based Chestnut Ridge Storage, which is owned by affiliates of Tenaska Power Fund of Omaha and eCorp LLC of Houston, told the Federal Energy Regulatory Commission (FERC) it received expressions of interest for about 75 Bcf, or three times the expected working capacity of the facility in the West Summit Gas Field.

The new storage is expected to have up to 500,000 Dth/d of injection/withdrawal capacity through as many as 26 storage injection/withdrawal wells providing high-deliverability, multi-cycle storage services. Chestnut Ridge expects to operate the storage facility at a maximum wellhead storage pressure of 3,500 psig, a pressure consistent with the discovery wellhead pressures observed in the production wells in the West Summit Field.

The field, known as the West Summit Gas Field, will interconnect directly to Dominion Transmission, Texas Eastern, and Columbia, and indirectly to National Fuel Gas Supply, and Transcontinental Gas Pipe Line.

Chestnut Ridge will offer open-access firm and interruptible storage services, firm and interruptible parking and loan services, and interruptible wheeling services. FERC agreed that Chestnut Ridge lacks market power over the provision of such services, and therefore could use market-based rates.

The Commission noted that although the “New York/Pennsylvania storage market is concentrated, with Dominion Transmission holding nearly 40% of the market share for both working gas capacity and peak day deliverability, in similar cases we have found such a market concentration to be acceptable when, as is the case here with Dominion Transmission, the dominant company’s facilities are regulated and its services are cost-based, thereby alleviating the potential for relatively small applicants to collude to hold prices at a monopoly level.”

Chestnut Ridge filed for the project in late 2007; its environmental clearance came earlier this year (see Daily GPI, March 30).

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