New Arizona pipeline and 10 bcf gas storage facility proposed

By the OGJ Online Staff

HOUSTON, Jan. 10 -- Driven by new gas-fired power plants in the southwest, Allegheny Energy Inc., Salt River Project, and Sempra Energy proposed a new pipeline and storage complex to connect the Las Vegas area with Kingman, Ariz.

The new complex, Desert Crossing Gas Storage & Transportation System, would include a 10 bcf storage facility and a 300-mile, 800-MMcfd pipeline connecting the storage complex with the interstate pipeline system in the Southwest.

The "high deliverability" storage facility will be capable of delivering gas supplies to peaking plants on short notice. The companies are hosting an open season to gauge interest from potential buyers willing to commit to firm contracts.

If the capacity is contracted, the companies said they will file the required regulatory permits for the facilities. Natural gas transportation and storage in Arizona and southern Nevada has been limited, and demand from power plants is increasing.

"This project with its north-south pipeline configuration will be uniquely situated to increase shippers and consumers options for sourcing natural gas and to provide new transportation capacity to these markets," said Michael Morrell, president, Allegheny Energy Supply Co., a unit of Allegheny Energy, Hagerstown, Md.

The Salt River Project is diversifying its fuel source for power plants and needs additional gas supplies, said David Areghini, general manager for power construction. SRP is a large public power utility serving 750,000 electric customers in the Phoenix area.

The tariff will include hourly scheduling flexibility, said Dwain Boettcher, vice-president, Sempra Energy Resources, a unit of Sempra Energy, San Diego.

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