The natural gas storage facility in Kenai hopes to have almost 20% more capacity online by the start of the new year.
That’s according to John Sims, who updated Kenai Peninsula Borough Assembly members on the facility’s expansion project earlier this month. Sims is the president of ENSTAR Natural Gas, Alaska’s largest utility company, and of the storage facility, called Cook Inlet Natural Gas Storage Alaska, or CINGSA.
“CINGSA was created back in 2011, 2012 for the sole purpose of allowing utilities to procure natural gas from Cook Inlet, store it into depleted reservoirs and then be able to use it for whatever their needs are later on in the season,” he said.
ENSTAR is a major user of CINGSA. Sims estimates the company met about 60% of its demand last winter with gas stored at the facility. He says the other 40% came from Hilcorp, which warned utilities in 2022 it may not be able to meet their future energy needs.
Sims says a $72 million expansion is underway. The first of two new storage wells is nearly done. They’re intended to stabilize the facility’s existing assets.
“As we have kind of developed and had seen challenges with natural gas supplies here in Cook Inlet over recent years, CINGSA decided to have an open season and see if there was any interest in expanding the facility,” Sims said.
There was. Enstar, which owns 65% of CINGSA, wanted the extra storage space. So now the facility is getting two new wells, which will increase its total storage capacity by almost 20%, from 11 Bcf to 13 Bcf.
That’s on top of two new compressors and a new dehydration unit. The compressors will be used to force gas into CINGSA’s reservoir when it’s at high capacity. The dehydration unit draws liquid out of the gas being stored.
Enstar wanted to expand the facility in part due to recent challenges with two of its wells.
“We lost 30% of the capacity from that facility, which had a massive impact on all the utilities here in Southcentral Alaska,” he said.
Sims says the new wells are intended to provide redundancy and flexibility. But, he says utilities generally still don’t have a lot of wiggle room.
“We still are anticipating an extremely tight winter,” he said. “We operate a system collectively as a group of utilities that really doesn’t have much redundancy, period. So anytime we have struggles in the winter time, especially … any challenges there really push us to the edge.”
CINGSA expects its second new well to be done by December. They hope to start taking advantage of the new space by the start of the new year.
