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Natural gas storage

Natural gas, like most other commodities, can be stored for an indefinite period of time. The natural gas supply chain – from exploration and production to transportation – is a time-consuming process, and the natural gas that reaches its destination is not always needed right away. Gas consumption is highly seasonal: It is higher in winter than in summer, since it is used extensively for heating in residential and commercial settings. For this reason, underground storage facilities are essential for storing surplus gas during the summer for subsequent use over the winter months.

Storage facilities can also be used to offset any interruptions in supply arising, for example, from technical incidents further up the supply chain.

The different techniques for storing natural gas

Natural gas can be stored :
 

  • Above ground, in liquid form in LNG tanks on LNG terminal sites, or in gaseous form, generally in spherical tanks ;

  • Underground in gaseous form by injection into natural geological structures.

Underground storage is by far the most effective and economical technique for the large-scale storage of natural gas.

Underground storage

There are three different storage techniques.

Aquifer storage

Aquifers are porous, permeable rock formations situated several hundred metres underground that act as natural water reservoirs. Under certain conditions, these water-containing rock formations can be used to store natural gas. Such formations are covered with a sealed layer of impermeable rock shaped to prevent any gas escaping upwards. As they are more expensive to develop than depleted gas reservoirs, these types of storage facilities are usually used only in areas where there are no nearby depleted reservoirs. These facilities are operated over a winter withdrawal period with a stable operating profile, although they may on occasion be used to meet peak load requirements as well.

Aquifer storage

(Source : eCORP)

Transforming an aquifer into a natural gas reservoir requires appropriate peripheral infrastructures, called “surface installations”: operating wells, monitoring wells, dehydration units, odorisation units, compression units (since aquifers are naturally full of water, in some instances powerful injection equipment has to be used with sufficient injection pressure to push down the resident water and replace it with natural gas). Since there is no naturally occurring gas in the rock formation to begin with, a certain amount of natural gas that is injected will ultimately prove physically unrecoverable : this is called “cushion gas” (or base gas).


Advantages and disadvantages of storage in aquifers :
 

  • Advantages: Gas storage can be developed in locations where depleted hydrocarbon reservoirs are not readily available or suitable for natural gas storage ;

  • Disadvantages: Maintaining the integrity of the gas/water interface imposes limits on operating flexibility. Requires a relatively large volume of cushion gas.

Salt cavern storage

Salt caverns are created by injecting fresh water into underground sedimentary rock formations made up partly of rock salt (sodium chloride) to dissolve the salt (a technique called leaching). The physical and chemical properties of rock salt – very low porosity, impermeability, chemical neutrality and good mechanical stability – make it an excellent medium for storing petroleum products in liquid or gas form. Since delivery can be instantaneous, the storage facilities are used to meet short-term demand surges.

 

Salt cavern storage

(Source : eCORP)

Cushion gas requirements are the lowest of all three storage types, with salt caverns only requiring about 33% of total gas capacity to be used as cushion gas.


Salt caverns typically store much lower volumes than depleted gas reservoirs and aquifers, and are also operated at higher pressures. In fact, salt cavern storage is essentially used to cover peak load requirements, because of its very high withdrawal flow rates. Salt cavern storage reservoirs can also be replenished much more quickly.

Advantages and Disadvantages of storage in salt cavern :

 

  • Advantages: High injection and withdrawal flow rates ;

  • Disadvantages: High volume of cushion gas. Environmental issues related to brine disposal during construction and operation. High operating cost due to the corrosive environment.


Storage in depleted fields

In this technique, pressurised gas is injected into naturally impermeable former hydrocarbon wells, which have been converted into storage reservoirs. The flow rate of gas withdrawal is continuous but slow, and there is little flexibility. Storage in depleted fields and storage in aquifers have close similarities with one another.

In France, there is one storage facility of this kind, at Trois Fontaines, currently under construction.

 

Storage in depleted fields

(Source : eCORP)

 Advantages and disadvantage of storage in depleted fields :

 

  • Advantages: Minimum disruption to environment apart from that caused by initial drilling operations. Known reservoir history ;

  • Disadvantage: the reservoir’s characteristics (e.g. low porosity and low permeability) can limit injection and withdrawal flow rates.

Comparative study of the different storage types

Why store natural gas?

Gas storage meets different needs :

Adjustment of supply and demand

The high seasonality of gas demand (for example, in winter, demand for gas in France is 5 times higher than in summer) is inconsistent with the generally steady rate of supply over the year.

So replenishing storage facilities in summer (period of low gas consumption) and emptying them in winter (when demand is high) enables gas suppliers to balance supply and demand.

Short-term flexibility

Storing natural gas is also a way of maintaining the necessary flexibility during short periods (several days), or during the day.

Week : gas requirements can vary significantly from one period to another (e.g. school holidays or weekdays/weekends) or with temperature variations

Day : gas demand is also not steady over the day, with consumption peaks occurring in the morning (around 8 a.m.) and in the afternoon (around 6 p.m.)

Arbitrage

Storing natural gas gives all participants in the gas market arbitrage opportunities, for example between spot and futures markets. So a supplier or trader can seize price opportunities by buying gas cheap, storing it and selling it when the price rises.

Responding to the needs of the transmission system

Finally, storage allows the gas transmission operator to achieve system balancing and maintain flexibility.