ERATH, La., Aug. 19 /PRNewswire-FirstCall/ -- AGL Resources (NYSE: AGL) subsidiary Jefferson Island Storage & Hub, LLC (JISH) has negotiated a tentative agreement with the state of Louisiana that, subject to approval, would resolve the pending lawsuit between the parties over a disputed mineral lease.
A finalized agreement would enable Jefferson Island Storage & Hub to resume its plan to expand the existing natural gas storage facility. This tentative agreement was disclosed in an August 18 announcement of a public hearing on the subject to be held by the state Department of Natural Resources in Iberia Parish on September 24. The state Mineral Board must approve the agreement in order for it to be valid, and a decision could come as early as this fall. The parties also have jointly requested that the trial court delay the pending September 28 trial date while the parties work through this approval process.
"To resolve the pending lawsuit, the state of Louisiana and JISH have negotiated an operating agreement by which JISH will have the right to proceed with its efforts to mine salt and create new natural gas storage caverns below its existing surface lease," said Dana Grams, president, Jefferson Island Storage & Hub, LLC. "If the Mineral Board approves the settlement, we can resume the permitting process to ensure that our project satisfies all environmental, safety and other regulatory requirements."
The JISH expansion is expected to result in significant economic benefits to the state and local economy during construction and on a continuing basis once the expansion is complete.
Salt dome storage is considered the safest means of storing natural gas by the U.S. Department of Energy, and there are more than 60 similar facilities along the Gulf Coast. The two existing JISH caverns have operated safely since 1994.
Located near the Henry Hub, the nation's largest pricing point for natural gas delivery, JISH currently consists of two salt dome storage caverns with 7.5 billion cubic feet of working gas capacities, 720,000 MMbtu/day withdrawal capacities and 360,000 MMbtu/day injection capacities. JISH provides storage and hub services through direct connection to the Henry Hub via the Sabine Pipeline and eight other pipelines: Texas Gas Transmission, Columbia Gulf Transmission, Sea Robin Pipeline, Tennessee Gas Pipeline, Trunkline Gas Company, Gulf South Pipeline, NGPL and CrossTex Energy Pipeline.
About AGL Resources
AGL Resources (NYSE: AGL), an Atlanta-based energy services company, serves approximately 2.3 million customers in six states. The company also owns Houston-based Sequent Energy Management, an asset manager serving natural gas wholesale customers throughout North America.
