National Fuel Gas will assume full ownership of underground natural gas storage field in New York
TGP in filings with FERC said it no longer needs the storage assets to satisfy its existing storage service commitments, and determined it would be more cost effective to use third party storage to support those commitments. TGP at the start of this month entered into a firm storage contract for nearly 4 Bcf of capacity with Kinder Morgan.
But National Fuel still needs the storage field and capacity on TGP's 200 Line in order to continue providing storage services to its customers. TGP agreed to sell its 50pc ownership interest in the field to National Fuel for $1. National Fuel will pay TGP $97,333/mo in lease reservation charges for the pipeline capacity.
Now that FERC has approved the companies' agreement, National Fuel will acquire full ownership interest in the Colden Storage natural gas storage field in Erie county, New York, including nearly 8.7 Bcf of base gas, or gas that must be present to maintain the storage field's pressure. That field has a working gas capacity, or the volume of gas that can be injected and withdrawn from storage, of 7.6 Bcf, and includes 168 active wells and about 60 miles (97km) of gathering and well lines.