Inergy Seeks Approval for Gas Storage in Once Deemed Unusable Salt Caverns

By Peter Mantius, Staff Writer, DCbureau.org

Key brine wells of interest, Salt Point on Seneca Lake

WATKINS GLEN, N.Y. — A Kansas City energy company is urging New York and federal regulators to disregard explicit warnings about the structural integrity of two salt caverns that it plans to use to store millions of barrels of highly-pressurized liquid propane and butane.

One cavern was plugged and abandoned 10 years ago after a consulting engineer from Louisiana concluded that its roof had collapsed in a minor earthquake. He deemed the rubble-filled cavity “unusable” for storage. It is now scheduled to hold 600,000 barrels of liquid butane.

The other cavern sits directly below a rock formation weakened by faults and characterized by “rock movement” and “intermittent collapse,” according to a 40-year-old academic study that cautioned that the cavern might be plagued by “difficulties in production arising from the geological environment.” That cavern is scheduled to hold 1.5 million barrels of liquid propane.

Both warnings were overstated, according to Inergy LP, which begins the fourth year of its bid to obtain an underground storage permit from the state Department of Environmental Conservation. “There is no reason to believe now that a roof cavern collapse did in fact occur,” Inergy wrote in a confidential 2010 report to the DEC.

The company claims its own tests show the caverns to be structurally sound and suitable for storing the liquefied petroleum gases, or LPG, under pressure of 1,000 pounds per square inch.

Public details of contrary opinions are scarce because Inergy, which bought the caverns from US Salt in 2008, has insisted that their history is a confidential “trade secret.”

Both the DEC and U.S. Environmental Protection Agency have generally accepted that argument and withheld or redacted many historical documents requested under state and federal Freedom of Information laws. However, the EPA did provide one document to DCBureau that disclosed the name of the Louisiana consulting engineer—Larry Sevenker.  The DEC later released documents that summarized Sevenker’s 2001 analysis of “Well 58,” the entry point for the cavern now set to hold liquid butane.

Those records and recent interviews with Sevenker reveal the DEC’s concerns about Well 58 and other Seneca Lake salt caverns in early 2001 following a series of catastrophic gas explosions in Hutchinson, Kansas.Sevenker had made many trips to the Watkins Glen brine field to study wells and caverns for US Salt and predecessor companies before US Salt hired him to report on Well 58. Dug in 1992, the well was originally used to mine salt by extracting brine, but US Salt had plans to eventually use the cavern to store compressed natural gas.

However, Sevenker’s findings convinced US Salt’s local manager, Alan Parry, to plug and abandon the cavern surrounding the well, according to a once-confidential letter.

“Our intentions for this well are to plug and abandon on the advice of our consultant, Mr. Sevenker,” Parry wrote the DEC on May 24, 2001. “He clearly states in his report that the roof movement is unusual and renders the cavity unusable for continued development or storage.”

Days later, Kathleen Sanford, a DEC permit administrator, wrote to New York State Electric and Gas to request a report on the integrity of nearby salt caverns NYSEG was using to store compressed natural gas. In particular, she wanted to know if its storage caverns had been affected by the Well 58 roof collapse “that occurred sometime prior to Feb. 12, 2001.” She said her questions “are in response to the Hutchinson, Kansas, incident.” … Read more