On a cloudy day in late April, Matt Federle is at the wheel of a white pickup truck. He’s ENSTAR’s director of gas storage. Turning off Bridge Access Road near the Kenai dock, he drives into a small clearing in the trees.
“We're going to take our drive around,” he says on his phone. “Is that all right?”
Rolling forward, Federle gestures to a collection of eight wellheads that jut up from the ground and connect to long silver pipes. Two of the wellheads stand out – they're scarlet red, as opposed to the other six which are a khaki brown.
“Six and seven are right there,” he says. “They're red. That's FMC’s color – FMC’s the wellhead manufacturer. Everything's red.”
The red wells are the culmination of years of work and more than $65 million to add capacity to the Cook Inlet Natural Gas Storage Alaska, or CINGSA. The wells came online last December.
CINGSA is the only third-party gas storage facility in Alaska. It’s where companies like ENSTAR, which runs the facility, stock away natural gas they can later draw from. Chugach Electric Association is the facility’s other firm customer, while a handful of other customers can buy the gas those companies don’t need.
Federle says the two new wells help take some of the pressure – literally – off the other six.
“The expansion itself, adding the wells, adding the additional wells … we don't have to push the other wells as hard as we previously were,” he said.
Federle says minimizing strain on infrastructure is important. The bigger the draw on the system, the more likely something can go wrong. Like during last year’s cold snap, when two of CINGSA’s wells partially failed. The uptick in demand by people trying to heat their homes amid ultra-cold temperatures sent utilities drawing from the gas they had in storage.
ENSTAR Spokesperson Lindsay Hobson says the consequences of failed wells is twofold.
“It's not just the commodity itself, but also the impact on facilities,” she said.
The expansion comes as utilities around Southcentral look for ways to stabilize the region’s supply of natural gas. It’s been about three years since Hilcorp Alaska warned it may not be able to meet existing demand contracts. Hilcorp has a near-monopoly on natural gas development in Cook Inlet.
Storing natural gas is one way utilities hope to stabilize supply. Right now, there’s no one competing with ENSTAR for commercial storage in Alaska. But Hilcorp is considering entering the market.
“It's like a squirrel putting nuts away for the winter, right?” Federle said. “You're preparing for the inevitable cold weather that's going to that's, you know, what's going to come sooner or later.”
The reservoir CINGSA stores gas in is under the mouth of the Kenai River. Federle says there are a few conditions that make the location ideal for gas storage – like proximity to existing gas lines and to land that can accommodate development.
“This one just happened to be the right size for the market,” he said.
At CINGSA’s main facility, across the street from the wells, one of the company’s new compressors whirs. Along with the red wellheads and some residual pieces of construction materials around the property, the compressor is above-ground proof of the expansion that’s taken place.
The new wells are hardly the only project ENSTAR’s been up to. In response to the forecast gas crunch, the company’s also eyeing a facility for potential gas imports. And the company picked up a contract with one of Cook Inlet’s smaller producers, too.
With summer well underway, gas demand has fallen from winter peaks. But at CINGSA, gas is already being stored for winter.
