Gas Co. backs off storage facility

The New Mexico Gas Co. is backing off, for now, on requesting regulatory approval to build a massive liquid natural-gas storage facility in Rio Rancho.

The utility had filed a motion at the state Public Regulation Commission last October for approval to build and operate the installation, which it projected would cost $38.1 million.

But PRC staff and some intervenors in the case, including the Attorney General’s Office and New Mexico Industrial Energy Consumers, expressed concerns about the project’s cost, design and proposals for rate recovery, said utility spokeswoman Teala Kail. They planned to file briefs opposing it in April.

“Rather than trying to build the facility with strenuous opposition, we decided to withdraw our motion and collaboratively address the intervenors’ concerns,” Kail said.

The company had planned the project in response to recommendations by federal and state regulators after an unusually severe cold spell in 2011 disrupted the utility’s supply system, forcing it to temporarily cut off gas to about 28,000 of its 500,000 customers.

As proposed, the facility would have included massive tanks to hold 2.5 million gallons of liquid natural gas on a five-acre site near Double Eagle II Airport. The company proposed to recover the project costs through a rate rider that would have increased average monthly residential customer bills by 1.12 percent.

Apart from the cost and rate recovery proposals, intervenors questioned the scope of the project, including its need and usefulness, Kail said.

“All parties have agreed to support the company’s motion to withdraw the … filing at the present time to review and reconsider it,” Kail said in an email. “Withdrawal at this time does not preclude NMGC from refiling.”
— This article appeared on page B01 of the Albuquerque Journal