November 12, 2008
Bobcat Gas’ Salt Cavern Begins Natural Gas Storage in Louisiana, Owners GE and Haddington Announce
Bobcat Gas Storage, its owners Haddington Energy Partners III LP and GE Energy Financial Services, announced today they have introduced one of the newest natural gas storage facilities in the United States.
The first cavern, which has completed its first week of successful commercial operations, is fully subscribed with customers. A second cavern is expected to be completed in the third quarter of 2009. After nearly three years of planning, permitting, construction and receipt of final permits from the state and federal agencies for the project 1.5 miles southeast of Port Barre in south-central Louisiana, Bobcat Gas Storage began providing storage services to its customers on Nov. 1. Bobcat's initial capacity is nearly 5.4 billion cubic feet of working gas (bcfw), which is planned to be increased to 10.3 bcfw by the third quarter of 2009 with the in-service of cavern 2, which is currently under construction, and fully built-out to 15.6 bcfw by year end 2009. The Bobcat site contains adequate space for Bobcat to expand on its success with additional natural gas storage caverns.
"We overcame escalating construction and material costs, a direct hit by hurricane Gustav and extreme weather with hurricane Ike to complete this state-of-the-art cavern to meet our contractual commitments. In this environment, this is a huge win for Bobcat," said Tom Dill, CEO of Bobcat. "With its superior location and flexibility of services, Bobcat will continue to grow our business to serve a diverse group of customers."
Underground natural gas storage is a critical component of the US natural gas infrastructure that balances weather-driven, highly seasonal demand and fluctuations in supply. Among underground gas storage facilities, salt caverns provide the greatest operational flexibility, supporting the widest range of storage. The Bobcat project benefits from its strategic location in the natural gas infrastructure grid and strong growth forecasts for US gas demand.
The Bobcat facility is located in St. Landry Parish, Louisiana, 45 miles from Henry Hub, the clearing point for NYMEX natural gas futures contracts and the most liquid trading point in the natural gas over-the-counter and cash markets. The project provides access to natural gas from offshore in the Gulf of Mexico, onshore in Texas and Louisiana, as well as from the Barnett Shale. Bobcat interconnects with five major interstate pipelines -- Florida Gas Transmission Company, Texas Eastern Transmission Corp., Transcontinental Gas Pipeline Corp, ANR Pipeline Company and Gulf South Pipeline Company. It provides gas to five key US natural gas consuming markets: the Northeast, Midwest, Mid-Atlantic, Southeast and Florida.
Each cavern is fully surrounded by salt and is approximately as deep as four football fields, beginning at approximately 4,500 feet beneath the surface and extending to a depth of close to 6,000 feet.
Bobcat offers customers both firm and interruptible storage services under its Federal Energy Regulatory Commission-approved tariff and market-based rates. Prospective customers interested in contracting for firm or hub services are encouraged to visit Bobcat's web site, www.bobcatstorage.com, for more information.
Bobcat is being developed by Port Barre Investments, LLC, owned by members of management, Haddington Energy Partners III LP, a private equity fund managed by Haddington Ventures, LLC and GE Energy Financial Services, the energy investing unit of GE. GE Energy Financial Services acquired an initial preferred equity interest in Bobcat last year for $65 million.
About Haddington Ventures, LLC
A private equity firm specializing in the midstream energy industry, Houston-based Haddington Ventures has raised more than $320 million of capital since its formation in 1998. The professionals who comprise Haddington Ventures' investment team have more than 100 combined years of operating experience in the midstream industry as well as a long history of working together. Among the participating investors in Haddington Ventures are large insurance companies; public and private pension groups, commercial banks and high net worth individuals. Visit Haddington Ventures' website at www.hvllc.com.
About GE Energy Financial Services
GE Energy Financial Services' experts invest globally with a long-term view, backed by the best of GE's technical know-how and financial strength, across the capital spectrum in one of the world's most capital-intensive industries, energy, to help their customers and GE grow. With $19 billion in assets, GE Energy Financial Services is based in Stamford, Connecticut. For more information, visit www.geenergyfinancialservices.com.
GE (NYSE: GE) is a diversified global infrastructure, finance and media company that is built to meet essential world needs. From energy, water, transportation and health to access to money and information, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. GE is Imagination at Work. For more information, visit the company's Web site at http://www.ge.com.
EDITOR'S NOTE: Caption for accompanying photo: Shown here is one of the newest natural gas storage facilities in the United States. Although the salt dome cavern is nearly a mile underground, the operation of the facility requires an impressive amount of above-ground facilities such as compressor stations and a leaching plant. Bobcat has successfully completed its first week of commercial operations. Bobcat Gas Storage is co-owned by GE and Haddington Energy Partners III LP.