Natural Gas Storage Facility Commences Service in Southeastern Texas

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Researched by Industrial Info Resources, (Sugar Land, Texas)--Tres Palacios Gas Storage LLC a wholly owned subsidiary of NGS Energy LP (Westport, Connecticut), began commercial operation of its natural-gas storage facility in Matagorda County, Texas. Operation commenced exactly one year from the date of receiving authorization from the Federal Energy Regulatory Commission to commence construction.

The natural gas storage facility currently has a storage capacity of 12 billion cubic feet in one salt dome cavern. There are two other 12-billion-cubic-foot caverns under development that are expected to come online in 2009 and 2010. Once all three caverns are operational, the site will have a total working gas capacity of 35.6 billion cubic feet, a maximum daily withdrawal rate of 2.5 billion cubic feet and a maximum daily injection rate of 1 billion cubic feet. In addition to the salt caverns, the facility also consists of a gas-handling facility that includes a 48,000-horsepower compressor station, the dehydration equipment and other associated infrastructure required to support the direction and routing of gas to and from the storage caverns. Ultimately, the compressor station will contain 10 Caterpillar model 3616 Ariel JGZ/6 reciprocating gas compressors, which are driven by 4,800-horsepower engines.

Atlas Engineering Incorporated (Houston, Texas) handled the design and engineering of the natural-gas storage and compression facilities. The Tulsa office of Calgary-based Flint Energy Services Limited (TSX:FES) handled the construction of the remaining surface facilities. The caverns had been previously solution mined by Texas Brine Company LLC (Houston, Texas). Wharton County Electric Cooperative also built a 6,000-kilowatt substation at the site.

The storage facility will have use of substantial pipeline header flexibility allowing interconnections to multiple pipeline systems. The Tres Palacios facilities also will include construction of two segments of looped bi-directional pipeline totaling 41.72 miles. Initially connecting to 11 interstate and intrastate pipeline systems, the pipeline is permitted to connect to up to 13 systems. The North Pipeline Corridor is comprised of 30.98 miles of 24-inch diameter pipeline. It is broken up into two segments--a 30.33-mile dual pipe and a shorter 0.65-mile single pipe. The North Pipeline Corridor will connect the storage facility with nine pipeline systems.

The South Pipeline Corridor consists of 10.74 miles of 24-inch diameter pipeline. The South Pipeline Corridor is also divided into two segments--6.38 miles of dual pipe and 4.36 miles of single pipeline. This will connect the storage facility will connect to two pipeline systems. The North and South Corridors allow Tres Palacios to connect to the Florida Gas, Transco, Tennessee, NGPL, CTGS, HPL, TETCO, Enterprise Texas, Enterprise Texas Intrastate and Kinder Morgan Tejas pipeline systems.

Driver Pipeline Company Incorporated (Irving, Texas) handled the construction of the pipeline as well as the meter and regulation stations.

NGS is planning to construct two additional natural gas storage facilities. The company is planning a 16 billion-cubic-foot underground salt dome at the Leaf River natural-gas storage facility in Smith County, Mississippi, and an 18 billion-cubic-foot Windy Hill natural-gas storage facility in Morgan County, Colorado. Leaf River is tentatively scheduled to begin construction in late 2008 or early 2009 and be in service by early 2010. The Leaf River site will connect to five regional natural-gas pipeline systems via 47 miles of 36-inch diameter pipeline. Windy Hill will connect to four natural-gas pipeline systems through a proposed 24-inch diameter pipeline. Windy Hill is slated to begin construction in mid 2009. The facility is planned to be in service by mid-2011. Windy Hill will utilize multiple bedded salt formations which will be brought online in increments of 3 billion to 4 billion cubic feet until the full 32 billion-cubic-foot capacity is reached.

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