Berlin, CT-based Yankee Gas broke ground Thursday on a new $108 million 1.2 Bcf LNG peak shaving facility at the company’s Eagle Street work center in Waterbury, CT’s south end. The plant, which recently received construction approval from the Connecticut Department of Utility Control, is expected to be in service for the 2007/2008 heating season.

“Today’s groundbreaking is an important milestone in our ability to meet the growing demand for natural gas and to ensure the security and flexibility of having another source of in-state gas supply,” said COO Dennis Welch. “This is good news for our customers because the facility will help mitigate price volatility during the heating season when natural gas prices tend to be the highest.”

The project includes a 158-foot diameter storage tank that stands 150 feet high. It will hold 15 million gallons of LNG and will be constructed by Chicago Bridge and Iron. The project will include liquefaction and vaporization equipment, allowing the tank to be filled by truck or interstate pipeline. The LNG facility’s vaporizers will be capable of sending out up to 600 MMcf/d of natural gas. Construction of the tank foundation is expected to begin in early March.

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