Suit Looks To Define Ownership Of CINGSA Storage Facility

Shaylon Cochran

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     Cook Inlet Natural Gas Storage Alaska, or CINGSA, is seeking a judgment in Kenai Superior Court to clear up a property dispute. CINGSA operates the natural gas storage facility just off Bridge Access Road in Kenai.

     The 24-page complaint filed last April in Kenai Superior Court seeks to clear up just who owns what in regards to the storage facility, which is actually a naturally-occurring, depleted natural gas field located beneath portions of the city of Kenai, the Kenai River and Cook Inlet.

     The facility had its official opening on May 31st of 2012, when Project Manager Rick Genges explained how operations work in what’s known legally as the Sterling C Gas Storage Pool of the Cannery Loop Unit.

     “Essentially, we’re just fulling up the structure once again. It originally contained about 26.5 billion feet of gas, it was a gas producing field, so it held gas over geologic time and nothing leaked out. So what we’re doing with gas storage is just filling that container up again,” he said.

     The suit alleges that an amount was established which CINGSA believed constituted just compensation for the city’s property and they submitted and a good faith written offer to acquire those property interests. The two parties failed to come to a formal agreement on what just compensation is, but the city has granted CINGSA the right to enter and use the property in order to continue operations as those negotiations continued.

     CINGSA also concluded that portions of the storage facility fall under the ownership of the state of Alaska and Cook Inlet Region, Incorporated, or CIRI which the city disputes, though CINGSA acknowledges that the city does own storage and mineral rights to some portions of the facility. In total, some fifteen-hundred acres are in question.

     Both CIRI and the DNR entered into lease agreements with CINGSA for use of the facility.

     The storage company cites in its filings both its status as a public utility and the need of its services as reasons to rule in its favor and invokes the possibility of eminent domain. The facility was designed to store natural gas produced during times of low demand, then send those reserve supplies out during peak demand times in the winter to all of South Central Alaska. CINGSA is looking to the courts to establish a price for the city property in question, if the court finds that the city holds the rights to that property.

     Calls to representatives for the City and CINGSA were not immediately returned.

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