Magnum NGLs adding underground propane storage in West

December 19, 2013 By    

A Utah company is looking to make solution-mined salt-cavern storage a solution for customers needing propane supply in the West.

Magnum NGLs has undertaken a project that will add 500,000 barrels of underground propane storage in central Utah, says Brady Flamm, the company’s vice president of business development.

The natural gas liquids (NGL) storage project, which involves drilling into a massive salt formation and pumping water through to dissolve the salt and create the cavern, has been in the works for about two years. The facility is scheduled to open April 1, 2014.

The Utah company initially planned to build a natural gas storage facility, but with the recent surge in NGLs from shale plays it expanded the project to include propane and butane storage caverns. The company also felt it could fill a supply need created more than five years ago when an underground propane storage facility in Moab, Utah, closed after it failed a mechanical integrity test. Those caverns stored about 5 million gallons of propane and butane.

“In the West there’s just a real shortage of bulk underground storage, so supply has to be stored above ground in tanks,” Flamm says. “It leaves suppliers in the West short propane in the winter and having to bring it in from other regions of the country and Canada.”

Flamm anticipates product in storage originating from a variety of sources in the western United States and Canada.

Magnum NGLs will stock the cavern in the summer by pumping propane underground and forcing out a mixture of salt and water called brine. The brine, stored in a 157-acre pond nearby, is then pumped into the cavern in the winter to force out the propane.

New truck and rail terminals will serve the facility and take product throughout the western United States.

“One thing customers like about us is we’re a storage provider, not a marketer,” Flamm says. “We’re not trying to take a position on product or compete with our customers. All we do is provide storage.”

Major U.S. propane hubs Mont Belvieu, Texas, and Conway, Kan., have underground salt-cavern storage. In the West, Arizona has underground storage in Adamana and Bumstead.

About the Author:

Brian Richesson is the editor in chief of LP Gas Magazine. Contact him at brichesson@northcoastmedia.net or 216-706-3748.

1 Comment on "Magnum NGLs adding underground propane storage in West"

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  1. A.j. Waquie says:

    Looking for storage to buy propane peak of summer low price to store for the winter. Please reply with minimum storage and cost, thank u.