NEW YORK (Reuters) - Chevron Corp's subsidiary Bridgeline Holdings has declared a force majeure on its natural gas storage cavern near Napoleonville, Louisiana, due to seismic events and a sinkhole that has formed near one of its storage areas, the company said.
The force majeure is in place until December 31, 2012, and was declared on Tuesday after a sinkhole forced the evacuation of local residents on Friday, according to company filings and local media.
"Chevron Pipeline Co (CPL) has elected to take the step of drawing down the NS1 cavern as a precaution to ensure that we are doing everything possible to protect public safety and the environment," said Gareth Johnstone, a Chevron spokesman.
There is no indication that gas is leaking from the facility, Johnstone said.
Bridgeline has asked customers to cut all nominations of gas into the storage cavern and begin reducing their current storage inventory to 40 percent of each of their currently contracted amount.
The company said on its website that it owns three natural gas salt dome storage caverns with total working gas capacity of 12.7 billion cubic feet and a maximum withdrawal of 1.1 bcf a day.
Johnstone said the company would not disclose daily specific volumes.
The potential failure of a mining cavern in a salt dome owned by Texas Brine Co LLC could be the reason for the sinkhole, the Baton Rouge Advocate newspaper said on Monday, citing state emergency preparedness and Louisiana Department of Natural Resources officials.
The sinkhole is about one acre wide and has ingested full-grown trees, local media said.
It is unclear where the seismic activity is originating, the newspaper said, citing officials.
Napoleonville is located in Assumption Parish in southeastern Louisiana with a population of 660 as of 2010, according to City-Data.com.
(Reporting By Jeanine Prezioso; editing by Jim Marshall)
Source: http://news.yahoo.com/chevron-files-force-majeure-natgas-storage-facility-174120566--sector.html
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