If their plan is successful, a facility capable of storing 10 million barrels of liquid gas would be developed in the region along the Ohio River that has the world’s largest natural gas field.
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| West Virginia Gov. Jim Justice at a rally with Trump on Aug. 3, 2017, in Huntington, West Virginia.(Justin Merriman/Getty Images) |
Proponents argue the Appalachian Storage and Trading Hub could transform the economy of this region, where the natural gas field stretches along the Ohio River in West Virginia, Ohio and Pennsylvania.
A report by ProPublica and the Charleston Gazette-Mail found several problems with the viability of Appalachian Storage and Trading Hub.
An “examination has found that the proposed storage facility would be far larger than the region could support and that questions about its cost, its viability and its environmental risks have been overshadowed by a public relations strategy heavy on the politics of jobs and light on the economics of energy policy.”
Top officials in West Virginia, with Manchin’s backing, are seeking a $1.9 million federal loan guarantee need to attract several more billions of dollars in private investment.
The region’s support of President Donald Trump is seen as key to the administration’s backing.
An environmental expert described the plan as risky.
“This whole project is a gamble,” said Dustin White, project coordinator with the Ohio Valley Environmental Coalition, an environmental group in Huntington, West Virginia. “Billions of dollars could go up in smoke. We just need to stop it now.”
An energy industry leader also raised questions.
“If that project gets a federal loan guarantee, banks will be lining up 10 deep,” said James Cutler, an energy industry investor and veteran chemical plant builder from Houston. “Anybody who gets involved gets 1.5 to 2 percent in fees just for getting the deals together. If you have a $4 billion, $5 billion project, that’s $80 million, $100 million.”
But U.S. Energy Secretary Rick Perry argues a West Virginia facility would have geographic advantages.
“To develop that in another region of this country, the Appalachian basin, makes sense because you’re sitting on top of Marcellus and Utica, which are prolific gas fields,” Perry told the committee during the March 2018 hearing.
The ProPublica report notes two companies — Energy Storage Ventures and Marathon Pipeline — “are cautiously examining the potential to establish much smaller, privately financed gas liquids storage facilities across the river in Ohio.”
David Hooker, president of Energy Storage Ventures, said, “We’d like to believe there is local demand for 2 million to 3 million barrels of storage in the Appalachian region. We question the need for 10-plus million barrels based on what exists today or the foreseeable future.”
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