Magnum Gas Storage, LLC (MGS), has announced the start of a 30 day non-binding open season for phase I of its natural gas storage project to be located in Millard County, Utah, situated near the town of Delta, Utah. This non-binding open season begins at 8 a.m., Mountain Daylight Time, on 1 September 2016, and ends at 5 p.m., Mountain Daylight Time, on 30 September 2016.
MGS is leveraging its experience in developing a successful NGL salt cavern storage business in 2012 in order to further develop this project, which is the first high deliverability, multi-cycle (HDMC) natural gas salt storage project in the western US.
Commercial storage services for the phase I of its two phased project are scheduled to commence in the second quarter of 2020 (2Q20). However, if sufficient market interest exists, MGS may be able to offer limited storage services at the beginning of the third quarter 2017 (3Q17). The approximate three to four turn facility is designed to provide a peak deliverability of up to 500 000 Dekatherms (Dth)/day and a peak injection of up to 360 000 Dth/day.
In phase I, MGS plans to develop two natural gas storage caverns, which have a combined firm gas capacity of approximately 20 million Dth/day. MGS has received Federal Energy Regulatory Commission (FERC) approval for phase I (with amendment pending approval) as well as approval for expanding into phase II by developing an additional two caverns (for a total of four), each with 10 million Dth/day of firm working gas capacity. Total project potential of phase I and II may provide up to 40 million Dth/day of working gas capacity.
Based on the current design, phase I initially will be capable of accepting natural gas at the Goshen Hub from Kern River gas transmission and Questar gas pipeline for injections of up to 360 000 Dth/day and for withdrawls of up to 500 000 Dth/day.
"There is little doubt that the western US energy markets are currently undergoing a paradigm shift, resulting in significantly increased market volatility," said Kevin Holder, Executive Vice President-Natural Gas Midstream for Magnum Energy. "There are a number of contributing factors, including aggressive solar and wind capacity development in the Western Electricity Coordinating Council, increasingly tighter pipeline balancing requirements and dependability issues with some existing infrastructure, along with new gas-fired generation and coal/nuclear retirements. We believe that strategic, dependable and flexible natural gas storage projects like ours will be critical in providing the tools necessary for managing this volatility," Holder added.
Adapted from press release by Francesca Brindle
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