Font ResizeA Utah company wants to develop eight salt caverns north of Delta to store up to 45 billion cubic feet of natural gas.
Magnum Gas Storage, a subsidiary of Salt Lake City-based Magnum Development, calls its project one of the West's first large-scale salt-cavern natural gas storage facilities and a potential boon to future alternative-energy development in the region.
"It isn't often that nature cooperates and places resources right where they are needed for industrial development," said Craig Broussard, who along with Rob Webster serve as managing directors at Magnum Development. "We have the perfect location and the perfect resource."
Energy companies typically store natural gas deep underground in the summer
Magnum is now in the process of getting the needed federal permits for its project, which will be located 10 miles north of Delta on about 2,000 acres, which the company controls. "We're hoping to have all the permits by next spring," Webster said, indicating the company hopes the first cavern will be available for storage in early 2012.
Once the permits are in hand, Magnum will begin creating the caverns in a massive salt deposit nearly one-mile thick that underlies its property. It will create the storage facilities using a solution-mining process that involves pumping water underground to dissolve the salt. The resultant brine solution is then extracted and the salt recovered for sale.
It will take approximately 18 months to two years to create each cavern, Webster said.
From June 10 to July 31, Magnum held a nonbinding "open season" for companies to express possible future interest in using its storage facilities. It received expressions of interest from 26 companies -- well beyond expectations, Webster said.
Tina Faust, manager of gas supply for Questar Gas, said the utility may be interested in using Magnum's facilities, but it is too early to tell since the project is still in the early stages of development.
Questar Gas already has access to the Clay Basin storage facility, which is located near the Utah-Wyoming state line. Owned by its sister company, Questar Pipeline, the facility is a depleted natural gas field capable of holding up to 57 billion cubic feet at a time.
Although Magnum initially will be in the business of storing natural gas -- the site is strategically located to take advantage of multiple pipelines that run through the area -- its partners envision developing a "Western energy hub." Such a facility would be designed to help expand the development of the West's renewable energy resources. It would use alternative energy generated in the area by wind and solar plants to push compressed air into one of Magnum's underground caverns that are not being used to store natural gas. Then, as additional electricity is needed, the company would release the underground air to turn power-generating turbines.
"It would be like a big storage battery for electricity," Broussard said.
Although salt storage caverns are rare in the West, Webster noted they are common along the Gulf Coast in Louisiana and Texas.
