Commission approves Inergy's purchase
WATKINS GLEN—The New York State Public Service Commission approved the sale of the Seneca Lake gas storage facility from New York State Electric & Gas Corporation (NYSEG) to Inergy Midstream, LLC, for $65 million, Thursday, Feb. 17.
The gas storage facility is located at U.S. Salt, located north of Watkins Glen, which is owned by Inergy. According to the Public Service Commission, the sale also includes the West Lateral and East Pipeline facilities. The commission said the lower operating costs resulting from this transaction will have the effect of reducing distribution rate increases for all firm NYSEG gas customers.
The sale of these assets has been under review for nearly one year. In petitions filed on March 31, 2010, NYSEG and the Inergy affiliates—including Arlington Storage Company, LLC and Inergy Pipeline East, LLC—requested approval for the sale of NYSEG’s Seneca storage facility, a 1.45 Bcf (billion cubic feet) working capacity underground storage facility; the West Lateral, a gas transmission line connecting the Seneca facility to the interstate gas transmission 2 pipeline owned by Dominion Transmission, Inc.; and the East Pipeline, a gas transmission line running from the Dominion pipeline to Binghamton, Broome County.
Inergy is also currently planning to build a $40 million gas storage facility in Reading, north of U.S. Salt. The project proposes storing and distributing propane and butane from a section of a 576 acre site located off of Routes 14 and 14A. The up-to-88.2 million gallons of LPG will be stored in the existing caverns, displacing some of the brine currently filling them. The brine will then be stored in a 14-acre, lined surface pond with a capacity of 91.98 million gallons. As LPG is removed, the brine will be pumped back into the wells to maintain constant pressure.
The New York State Department of Environmental Conservation is currently acting as lead agency in a review of the project. In January, the DEC asked for public comments on the proposed facility.