Caliche Development Partners III, via its subsidiary Golden Triangle Storage (GTS), has reached a final investment decision (FID) for the initial phase of the Spindletop Expansion Project in Beaumont, Texas, US.
GTS operates a federally regulated interstate underground natural gas facility in Jefferson County. The Spindletop Expansion Project is expected to increase existing natural gas storage capacity by roughly 30.75 billion cubic feet (bcf).
The FID for the expansion project’s first phase follows the receipt of a Federal Energy Regulatory Commission (FERC) certificate of public convenience and necessity.
This expansion phase will be financed through debt from MUFG.
The first phase of the project will see the construction of two new salt dome storage caverns and associated surface infrastructure. This includes interconnections with Kinder Morgan’s Trident and ARM’s Mustang pipelines.
The project is said to be in line with GTS’ third and fourth gas cavern expansions, which are scheduled for completion in 2027.
Caliche reported that the FERC-approved 2024 expansions were followed by an open season that was nearly six-times oversubscribed, indicating strong customer interest and commitments.
Caliche chief commercial officer Sam Wallace said: “We have been encouraged not only by FERC's recognition of the critical need for additional storage to strengthen the reliability of the nation's natural gas and electric systems but also by FERC accessibility and ongoing engagement throughout the approval process.
“Given the strong customer response to our latest open season, we expect to fully subscribe both caverns in our current expansion and to move forward with two future phases. We look forward to continuing our collaboration with FERC to bring everything to fruition.”
Overall, the Spindletop Expansion Project involves constructing four additional salt dome storage caverns, designated as Caverns 8, 10, 11 and 12. The project also calls for setting up temporary drilling areas and permanent well pads for these new caverns.
Additional infrastructure will be installed, such as pipelines for gas injection and withdrawal, raw water supply and brine return piping, instrument air lines, and a conduit for electrical and control systems.
Equipment planned for the expansion includes gas dehydration units, heaters, metering systems, process control instrumentation and a flare for blowdown operations.
On full buildout, which would require a separate FID for the remaining two FERC-approved caverns, GTS is projected to have a total capacity exceeding 60bcf.
Planned operational rates include injection rates up to 2.2bcf per day (bcf/d) and withdrawal rates up to 2.5bcf/d across eight caverns.
The company says this would make GTS the largest natural gas storage hub on the Gulf Coast.
Expanded operations at the Beaumont site are scheduled to begin in late 2028, continuing into early 2029.
Caliche is a portfolio company of investment firm Sixth Street.
