Liquefied natural gas (LNG) export projects from the Gulf of Mexico (GOM) region could lead to a resurgence in gas storage, and Sempra Energy executives see some signs that it’s starting to happen.

The market for storage has picked up a lot in the past six months, and the prospects are improving for signing new shippers for pipeline flows westerly and southerly out of the eastern shale plays, they said during an earnings conference call Thursday.

Sempra President Mark Snell called the recent storage market “depressed,” but he thinks it is ready to turn around. Right now the only value recognized in storage is summer-winter price spreads, Snell said.

“Those spreads have been relatively small and weak for the last few years, but we are certainly seeing that change,” he said. “We’re seeing a higher value for it.

“But more importantly, for the first time in more than four years we’re seeing a real return to some extrinsic values related to the volatility around the gas market. We’re now seeing a value put on that, and we’re getting that in our storage rates currently.”

Snell thinks this part of the midstream gas business “seems to be coming back a bit.” He cited the example of Sempra recently selling some storage to marketers, something the company had not done in a number of years.

“There is something going on there, but I am reluctant to say that it is back to where it was seven or eight years ago, but it is certainly a better market today than six months ago.”

CEO Debra Reed said Sempra’s storage/pipeline assets linked to its Cameron, LA, LNG project do not support an initial master limited partnership (MLP) creation in the Gulf, but in the longer term the prospects look good for a storage/pipeline comeback.

With the prospects for reversing flow from the Utica and Marcellus shale plays on the Rockies Express (REX), in which Sempra has a part interest, and other pipelines, Reed said what she sees in the GOM region’s LNG export development is “going to change some of the dynamics for storage certainly.”

“What we are starting to see more interest in is contracting on a long-term basis for storage assets,” Reed said.

In regard to REX flows reversing to go to the Midwest and GOM regions, Reed said Sempra hopes to sign new shipper contracts in the near future. “We added a nonbinding open season, and there seemed to be a lot of interest in that, so we would like to pursue that,” she said.

“We think this is going to happen relatively soon, with the need for takeaway capacity in the Marcellus and Utica [shale plays]. We also are working on a lateral that will be open later this year, so the whole dynamics [in the north] are going to change quite rapidly, and we need to be able to respond rapidly.”

Sempra holds a 25% interest in REX, and Reed and Snell have touted it as a long-term asset, particularly with its reach to the Utica and Marcellus plays (see Daily GPI, Aug. 8, 2012).