Inergy to Buy Seneca Lake Storage and Pipelines

January 2010 Vol. 237 No. 1

Inergy, L.P. announced Jan. 11 that its wholly-owned subsidiary, Inergy Midstream, LLC has executed a definitive agreement to purchase the Seneca Lake natural gas storage facility located in Schuyler County, New York, and two related pipelines for approximately $65 million from New York State Electric & Gas Corporation.

Seneca Lake is an approximate 2.0 Bcf underground salt cavern
storage facility located on Inergy’s U.S. Salt property outside Watkins Glen, NY, and has a maximum withdrawal capability of 145 MMcf/day and maximum injection capability of 75 MMcf/day. Seneca Lake is connected to the Dominion Transmission System via the 16-inch, 20 mile Seneca West Pipeline and indirectly to the city gate of Binghamton, NY, via the 12-inch, 37.5 mile Seneca East Pipeline, which runs within approximately 4 miles of Inergy’s Stagecoach North Lateral interconnect with the Millennium Pipeline.

“This acquisition expands our storage and transportation capacity and provides us with an important pipeline infrastructure that enhances the connectivity and flexibility we can offer customers on our system,” said John Sherman, President and CEO of Inergy, L.P. “The acquisition, which meets our investment criteria on a stand-alone basis, will also significantly enhance the value of Inergy’s existing assets and is expected to increase our economic return on future expansion projects in the northeast market.”