What is Central Valley Gas Storage?
Who are the owners and operators and what is their experience?
Who will Central Valley's customers be?
Why is natural gas storage important?
Why is gas storage needed?
How safe is gas storage?
What sort of infrastructure would be built to operate the storage facility?
What is the regulatory approval process for the project?
Why does California need this facility?

What is Central Valley Gas Storage?
Central Valley Gas Storage L.L.C., a wholly owned subsidiary of Nicor Inc., is developing a new underground natural gas storage facility north of Sacramento, California in Colusa County.  Central Valley plans to provide up to 8 Bcf of working gas capacity when fully developed.  The storage project lies in a rural setting on land used primarily for agricultural purposes.

Who are the owners and operators and what is their experience?
Central Valley Gas Storage, L.L.C. is a wholly owned subsidiary of Nicor Inc. (NYSE: GAS).  Nicor has over 50 years experience in the development, operation, and ownership of  gas storage assets and currently operate over 150 Bcf of gas storage in multiple locations.  Utilizing its extensive expertise in the development and operation of storage fields, Central Valley Gas Storage is converting the underground formation from a gas production reservoir into a high-deliverability storage field.

Who will Central Valley's customers be?
Central Valley will provide services to meet the growing requirements of California's wholesale gas market including utilities, power generators, producers, and marketers.

Why is natural gas storage important?
Natural gas storage has an important role in maintaining the reliability of supply needed to meet the demands of consumers.  Storage services serve as a buffer between production, transportation and distribution to consumers to ensure that adequate supplies of natural gas are available during seasonal demand shifts, unexpected demand surges or unexpected weather events. 

Why is gas storage needed?
The approximately 400 interstate underground natural gas storage facilities located throughout the United States are a key component to maintaining the reliability, integrity, and capability of the Nation's natural gas transmission and distribution network. Natural gas storage is critical to meeting seasonal high demand requirements. Additionally, the ability to deliver the additional volumes of gas into the pipeline system helps to
smooth price volatility.

How safe is gas storage?
Natural gas storage is a regulated business that is required to maintain strict safety and environmental controls. Gas storage in a depleted reservoir, like the Central Valley Gas Storage facility, mimics nature's way of safely storing gas for millions of years. Central Valley Gas Storage will be built to meet or exceed all regulatory and modern industrial safety standards employing the latest technologies and engineering.

What sort of infrastructure would be built to operate the storage facility?
The project infrastructure consists of the storage field (injection/withdrawal wells and associated gathering lines), compression and other gas handling facilities, and a pipeline connecting the storage field to PG&E's gas transmission system. Central Valley Gas Storage will oversee the construction of an approximately 14-mile pipeline from the storage field to PG&E's transmission line.

What is the regulatory approval process for the project?
The project will require a Certificate of Public Convenience and Necessity issued by the California Public Utilities Commission (CPUC), as well as environmental review under the California Environmental Quality Act. Central Valley Gas Storage submitted an application to the CPUC in August of 2009.

Why does California need this facility?
There is growing demand for natural gas storage in California and this project adds 8 Bcf of storage capacity to help meet that need. Natural gas has become an increasingly important source of energy in California since more and more of the state's power plants rely on the fuel.  While California's successful efficiency programs and its reliance on renewable sources of electricity should slow the demand for natural gas, competition for supply is increasing.  California's reliance on imported gas leaves the state vulnerable to price shocks and supply disruptions.