Reuters) - A sinkhole the size of a football field in southern Louisiana has forced energy companies to halt nearby natural gas pipeline activity and draw down fuel from a local storage cavern.
Chevron Corp's subsidiary Bridgeline Holdings declared force majeure on new injections into its salt dome storage facility near the sinkhole and the town of Napoleonville, through the rest of the year, according to notice to customers posted on its website.
Customers were also asked to begin reducing their current storage inventory to 40 percent of each of their currently contracted amount, according to the Bridgeline filing.
Natural gas traders said Chevron's move to purge the gas could push an additional 4 billion to 5 billion cubic feet of gas on the market. U.S. September and October futures prices settled lower, while winter months settled higher on Wednesday, and traders said companies could be scrambling to sell supplies while locking in winter gas to meet heating demand.
"Chevron Pipeline Co 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.
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