Petal Gas Storage Co., a wholly-owned subsidiary of Crystal GasStorage Inc., filed its second application with FERC to add 3.6 Bcfof storage capacity to its Nos. 6 and 7 salt caverns in ForrestCounty, MS, last week. The first application, filed in July, wasdenied by FERC because it lacked detail.

Petal has already executed a precedent agreement with SouthernCo. Services, Inc. for 7 Bcf of firm storage capacity and has otherlong-term firm storage contracts for 2.5 Bcf. Both caverns canstore up to 3.2 Bcf of gas currently, and the expansion calls foreach cavern to be increased to 5 Bcf of capacity.

FERC requested more information about the solution miningprocess and equipment needed to carry out this kind of expansion.As a result of further testing on Cavern No. 6, however, Petaldecided that additional solution mining would not be necessary.

Another issue FERC had with Petal’s first application is thatthe storage company said it was planning a two-staged expansion,with Phase I involving the construction of added capacity and PhaseII involving the construction of additional pipeline facilities,but did not say if Phase I was independent of Phase II. In thislatest filing, Petal said it. “Petal intends to go forward with theproposed expansion of storage capacity even if the construction ofthe Phase II facilities, either by Petal or another interstatepipeline, does not occur.” The pipeline expansion is still in theplanning process and Petal said it expects to file an applicationwith respect to Phase II “toward the end of this year or early nextyear.”

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