The market for natural gas in the northeast has a dire need for high capacity, flexible storage caverns to balance sharp fluctuations in demand with the growing supply of natural gas from the Marcellus shale, industry officials said recently.

Bill Moler, president and chief operating officer of Inergy Midstream LP said that the overall annual market for natural gas in the Northeast is approaching excess capacity, but daily demand fluctuates abruptly.

“We are rapidly approaching on an annual basis a cycle where supply far outgrows demand. However, the gas market ...