By Joshua Mann | Reporter, Houston Business Journal | June 7, 2019 (Houston Business Journal) –
Houston-based Caliche Development Partners has made progress underground on its Beaumont terminal expansion, but it’s waiting to get more commercial support before it builds above the surface.
The company has started work on two new storage caverns at the storage facility meant to hold 3 million barrels and 5 million barrels of product, coming online in the fourth quarter of 2020 and the first quarter of 2021, respectively, CEO Dave Marchese said.
Caliche owns a salt dome storage terminal — where hydrocarbons can be kept underground in massive quantities — in Beaumont, Texas, where it already has one 5 million-barrel asset up and running. That cave, which can store 5 million barrels of ethylene, started up in the third quarter of 2018 and is about 50 percent under customer contracts.
Caliche started work on the two new caverns without finding customer commitments ahead of time. The work underground is cheaper and slower than the infrastructure the company will build above, so it can afford to start early, Marchese said. That approach is uncommon for midstream companies.
“It’s unique to us,” Marchese said. “In the end, we’re creating space and value on our site and allowing us to move more quickly if customers have storage needs down the road.”
Caliche hasn’t decided for sure what products the two new caverns will store, but Marchese said he thinks it will likely be Y-grade natural gas liquids in the smaller cavern and ethane in the larger. There were signs of storage shortages for Y-grade in fall 2018 that a new cavern could help alleviate, Marchese said.
Caliche employs about 30 people right now between Houston and Beaumont, and the company could add four to six employees once it completes the two new caverns, Marchese said.
Marchese declined to comment on his company’s revenue. Caliche is backed by Energy Spectrum Capital.