Jan. 25, 2022 | Marcellus Drilling News
U.S. Senator from West Virginia Shelley Moore Capito “Zoomed” in to address the Gas and Oil Association of West Virginia’s (GO-WV) annual winter meeting last week. She talked about the Biden infrastructure bill, which she supported, and Biden’s so-called Build Back Better bill, which she does not support. As part of her comments, Capito mentioned the $1.2 trillion infrastructure bill includes money for “an Appalachian ethane/hydrogen storage hub.” Wow! We thought that project was long dead.
Appalachia Development Group is (or was) leading an effort to build a ~$10 billion (or $2.5B, or $3.4B, depending on your source) NGL storage hub in Appalachia–most likely in West Virginia (see WV’s US Senators Lead the Charge to Build $10B NGL Storage Hub). The project, called the Appalachia Storage and Trading Hub, needs a federal loan guarantee of $1.9 billion, which was in the works for years. But the loan guarantee was in doubt following a budget bill passed by Congress in December 2019 (see Did Federal Budget Passed This Wk Torpedo M-U NGL Storage Hub?).
In the summer of 2020 we reported the comments of one expert who said the planned Appalachia Storage and Trading Hub would never happen (see Expert Says Massive Appalachian NGL Storage Hub Won’t Get Built). Mike Tritt, President and CEO of Lane Power and Energy Solutions Inc., is an expert on building natural gas liquids storage facilities. Tritt said it’s very unlikely there will be one, massive NGL hub like that envisioned by Appalachia Development Group. Instead, Tritt said a number of smaller storage projects will get built in our region. We had also heard the same sentiment at a number of industry events.
So, we figured the big ethane hub was dead. It’s been radio silence on the big hub since 2020. But according to Capito, there’s now money for that project–or a project that includes both ethane and hydrogen. Her comments don’t say how much money and what funding looks like for the project. However, we’re just encouraged that the big ethane hub is being talked about once again after two years of silence.