Sempra Energy Trading Plans to Develop a New Natural Gas Storage Facility in Louisiana

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Sempra Energy Trading, a subsidiary of Sempra Energy Global Enterprises, a business unit of Sempra Energy Resources (NYSE:SRE) (San Diego, California) is planning to develop a new salt cavern type underground natural gas storage facility in Evangeline Parish, Louisiana. The facility is being sited near the existing Henry Hub, the nation's largest natural gas trading center (PEC 02004987). Current plans envision the Pine Prairie Energy Center to have a ultimate storage capacity of 24 Bcf of natural gas utilizing three salt dome storage caverns with a daily injection and withdrawal rates capable of handling 1.2 Bcf & 2.4 Bcf respectively.

A new compressor station based on either electric-drive or internal combustion engine based compression be between 32,000 and 48,000 horsepower in size will supply compression & dehydration needs (PEC 02004988). The Pine Prairie Energy Center will be strategically located near nine key intrastate pipelines. Sempra is considering acquiring a 15-mile stretch of an existing 24" diameter pipeline and then looping it with 24" diameter pipeline and constructing a 5-mile dual 24" extension for bi-directional gas transport.

Sempra has contracted the services of Mustang Engineering LP (Houston, Texas) for engineering and permitting services and expects to file the $200 million storage project with the FERC in the early third quarter of 2004. Sempra hopes to receive a FERC certificate in time to begin leaching the first 6.2 Bcf cavern in the fall or early winter of 2004, with a completion targeted to take advantage of the 2005/2006 winter heating season. The equipment and construction bid packages should begin to flow in late 2004.

The Pine Prairie Energy Center was originally being developed by SG Resources Louisiana LLC, a subsidiary of SGR Holdings LLC (Houston, Texas) until Sempra purchased the land and associated rights to develop the project for an undisclosed amount in early April of 2004. For details see archived IIR Industry Alert: SGR Holdings Exploring the Possibility of Constructing a Natural Gas Storage Facility on the Gulf Coast.