SemGroup LP said Monday a subsidiary, SemGas LP, has acquired Greyhawk Gas Storage Co. LLC of Steuben County, NY, from Falcon Northeast Holdings LLC for an undisclosed price. This was the company’s second acquisition of storage facilities in Steuben County within 75 days.

Greyhawk Gas Storage, through its Wyckoff storage development project in Steuben County, will provide 6 Bcf of working gas storage when the project is completed and in service, said Tom Kivisto, president and CEO of SemGroup, a Tulsa-based midstream company. Greyhawk also owns the Jasper storage development project in Steuben County, which could provide another 6 Bcf of working gas capacity, a SemGroup spokesman said.

Kivisto said the Greyhawk assets will complement the salt cavern gas storage development project that SemGroup acquired in November 2004. Previously named New Avoca, the development project has been renamed Cohocton Valley to better reflect its location, he noted.

SemGas purchased the New Avoca facilities from Blue Dolphin Energy Co. and WBI Pipeline & Storage Group Inc. for $3.5 million (see Daily GPI, Nov. 2, 2004). It expects to develop a facility with 5.5 Bcf of working gas capacity, 300-500 MMcf/d of deliverability and 250-300 MMcf/d of injection capacity. The company hopes to have the project in operation by 2006.

“Greyhawk already has a FERC 7 (c) certificate” for the Wyckoff storage project,” which “should be commercially operable within the year,” Kivisto said. It does not have a certificate yet for the Jasper project. “Coupled with the longer-term expansion potential of Cohocton Valley, these storage assets will provide customers in the New York and New England area the long-term storage services needed as the transportation infrastructure expands beyond its current constraints.”

Kivisto said SemGas will be responsible for completing and operating both the Greyhawk and Cohocton Valley storage facilities.

Houston-based Falcon sold its New York storage assets in order to focus its gas storage operating and development efforts on existing facilities in North Texas and its storage development along the Texas, Louisiana and Mississippi Gulf Coast, according to Falcon President and CEO John M. Hopper.

Specifically, Falcon said it plans to use the proceeds from the Greyhawk sale to complete the Phase II expansion of its Hill-Lake Gas Storage facility, which serves the North Texas/Dallas-Fort Worth market, and to advance the development of its MoBay Storage Hub, a high-deliverability, multi-cycle gas storage project that will serve the Southeast and Florida markets.

Falcon is the largest independently owned developer and operator of high-deliverability, multi-cycle gas storage capacity in the United States.

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