Natural gas, like many other commodities, can be stored indefinitely in natural gas storage facilities for future consumption.
Video Natural gas storage
Usage
Gas storage is basically used to meet load variations. The gas is injected into storage during the low demand period and is withdrawn from storage during the peak demand period. It is also used for a variety of secondary purposes, including:
- Balances the flow in the pipeline system. This is done by mainstream pipeline transmission companies to maintain the operational integrity of pipelines, by ensuring that pipeline pressure remains within the design parameters.
- Maintain a contractual balance. The sender uses stored gas to keep the volume they supply to the pipe system and the volume they spend. Without access to such storage facilities, any imbalance situation will result in substantial penalties.
- Flatten production during fluctuating demand periods. Producers use storage to store any gas that is not directly marketed, usually during the summer when demand is low and deliver it in winter when demand is high.
- Market speculation. Producers and marketers use gas storage as a speculative tool, saving gas when they believe prices will increase in the future and then sell them when they reach that level.
- Insure against unforeseen accidents. Gas storage can be used as an insurance that can affect the production or delivery of natural gas. This may include natural factors such as hurricanes, or damage to production or distribution systems.
- Fulfill regulatory obligations. Gas storage ensures to some extent the reliability of the gas supply to the consumer at the lowest cost, as required by the regulatory body. This is why regulatory agencies monitor storage inventory levels.
- Reduces price volatility. Gas storage ensures commodity liquidity in the market centers. This helps to contain the instability of natural gas prices and uncertainty.
- Keep up with changes in natural gas demand. Gas storage facilities are becoming more important due to changes in natural gas demand. First, the traditional supplies that once meet the peak demand of winter are now unable to keep up. Secondly, there is an increased summer peak demand on natural gas, because power plants go through gas-fired power plants.
Maps Natural gas storage
Size and definition
Characteristics of underground storage facilities need to be determined and measured. A number of volumetric measures have been taken for that purpose:
- Total gas storage capacity: This is the maximum volume of natural gas that can be stored in a storage facility. This is determined by several physical factors such as reservoir volume, and also on the operating procedures and engineering methods used.
- The amount of gas in storage: This is the total volume of gas in storage at the facility at any given time.
- Alkaline gas (also referred to as bearing gas): This is the volume of gas intended as a permanent supply in the storage reservoir to maintain adequate pressure and delivery rates throughout the withdrawal season.
- Working gas capacity: This is the total gas storage capacity minus the base gas.
- Gas work: This is the total gas in the minus gas gas storage. The working gas is the volume of gas available for the market at any given time.
- Gas that is physically irreversible: The amount of gas that is permanently embedded in the storage facility formation and which can never be extracted.
- Bicycle level: This is the average amount of reservoir working gas volume can be reversed over a period of time. Usually the time period used is one year.
- Posts: This is a measure of the amount of gas that can be delivered (withdrawn) from the storage facility every day. This is also referred to as the delivery rate, withdrawal rate, or withdrawal capacity and is usually expressed in millions of cubic feet of gas per day (MMcf/day) that can be delivered.
- Injection Capacity (or speed): This is the amount of gas that can be injected into a storage facility every day. This can be considered as a complement of deliverability. Injection rates are also usually measured in millions of cubic feet of gas that can be delivered per day (MMcf/day).
The above measurements are not specified for certain storage facilities. For example, deliverability depends on several factors including the amount of gas in the reservoir and pressure etc. Generally, the rate of deliverability of storage facilities varies directly with the total amount of gas in the reservoir. This is at the highest point when the reservoir is full and decreases as the gas is withdrawn. The capacity of storage facility injection also varies and depends on factors similar to those affecting deliverability. The degree of injection varies inversely with the total amount of gas in storage. This is the highest when the reservoir is nearly empty and decreases as more gas is injected. Storage facility operators can also change operational parameters. This will allow, for example, the maximum storage capacity to be increased, the withdrawal of alkaline gas during extremely high demand or reclassification of the basic gas to the working gas if technological advances or engineering procedures are possible.
Type
The most important type of gas storage is in the underground reservoir. There are three main types - the depleted gas reservoir, the aquifer reservoir and the salt cave dam. Each of these types has different physical and economic characteristics that govern the suitability of a particular type of storage for a given application.
Gas reservoir depleted
This is the most prominent and common form of underground storage. They are the reservoir formations of natural gas fields that have produced all the economically recoverable gases. This exhausted reservoir formation is ready to store the injected natural gas. Using such facilities is economically attractive as it allows for reuse, with appropriate modification, of the extraction and distribution of the remaining infrastructure from productive life in gas fields that reduce initial costs. The exhausted reservoir is also interesting because their geological and physical characteristics have been studied by geologists and oil engineers and are usually well known. As a result, the exhausted reservoir is generally the cheapest and easiest to develop, operate, and maintain three types of underground storage.
To maintain working pressure in run-off reservoirs, about 50 percent of natural gas in formations should be stored as bearing gas. However, because the previously empty reservoirs are filled with natural gas and hydrocarbons, they do not require gas injection that is physically irreversible because it is already in the formation. This provides further economic impetus for this type of facility, especially when the cost of gas is high. Typically, this facility operates on an annual cycle; gas is injected during the summer outside summer and is withdrawn during the winter months of peak demand.
A number of factors determine whether an exhausted gas field will make an economically viable storage facility. Geographically, the depleted reservoir must be relatively close to the gas market and transport infrastructure (pipeline and distribution system) that will connect them to that market. Because the fields are at one time productive and connected to the infrastructure, the distance from the market is the dominant geographical factor. Geologically, it is preferable that the vacated reservoir formation has high porosity and permeability. The porosity of the formation is one of the factors determining the amount of natural gas that the reservoir can accommodate. Permeability is a measure of the rate at which natural gas flows through the formation and ultimately determines the level of injection and gas withdrawal from storage.
Aquifer reservoir
Aquifers are underground, porous and permeable rock formations that act as natural water reservoirs. In some cases they can be used for natural gas storage. Usually this facility is operated on one annual cycle such as with the reservoir runs out. The geological and physical characteristics of the aquifer formation are not known in advance and significant investments should be made to investigate this and evaluate the suitability of aquifers for natural gas storage.
If the aquifer is suitable, all related infrastructure must be developed from scratch, increasing development costs compared to run-off reservoirs. This includes the installation of wells, extraction equipment, pipelines, dehydration facilities, and possible compression equipment. Since the aquifers initially contain water, little or no gas is formed naturally in the formation and the partially injected gas will be physically irreversible. Consequently, the storage of aquifers typically requires a much larger bearing gas than a depleted reservoir; up to 80% of the total gas volume. Most aquifer storage facilities are developed when natural gas prices are low, which means the gas pads are not expensive to sacrifice. With the increase in the price of storage gas aquifers become more expensive to develop.
The consequence of the above factors is that developing aquifer storage facilities is usually time consuming and expensive. Aquifers are generally the most undesirable and most expensive type of natural gas storage facility.
Salt formation
The underground salt formation is perfect for natural gas storage. The Salt Cave allows very little of the natural gas injected to escape from storage unless specifically extracted. Salt cave walls are strong and resistant to gas during the lifetime of storage facilities.
Once the salt features are found and found suitable for the development of a gas storage facility, a cave is made in salt feature. This is done by the solution mining process. Fresh water is pumped into the drill hole into the salt. A portion of the dissolved salt leaves a void and water, now salt, is pumped back to the surface. The process continues until the cave is the desired size. Once created, the salt cave offers underground natural gas storage vessels with very high shipments. The need for low bearing gas is usually about 33 percent of the total gas capacity.
Salt caves are usually much smaller than gas containers and storage facilities that run out of aquifers. The salt cave facility occupies only one hundredth of the area taken by the depleted gas storage facility. As a result, salt caves can not accommodate the large volumes of gas needed to meet basic storage load requirements. Deliveries from salt caves, however, are much higher than for aquifers or reservoirs that run out. This allows the gas stored in the salt cave to be pulled and recharged faster and faster. Fast cycle times are useful in emergency situations or during short periods of unexpected demand surge.
Although construction is more expensive than land conversion that is exhausted when measured on the dollar per thousand cubic feet of working gas, the ability to make several withdrawals and the injection cycle each year reduces the cost effectively.
More
There are also other types of storage such as:
LNG
The LNG facility provides shipping capacity during peak periods when market demand exceeds pipeline shipments. LNG storage tanks have a number of advantages over underground storage. As a liquid at about -163 ° C (-260 ° F), it occupies about 600 times less space than underground stored gas, and delivers high deliverability in a very short period of time since LNG storage facilities are generally located near with the market and can be transported to some customers to avoid the toll pipeline. There is no requirement for gas bearings and allow access to global supplies. The LNG facility, however, is more expensive to build and maintain than to develop a new underground storage facility.
Pipe capacity
Gas can be stored temporarily in the pipe system itself, through a process called packing the lines. This is done by packing more gas into the pipe through increased pressure. During periods of high demand, larger amounts of gas can be drawn from pipes in market areas, rather than injected in production areas. The process of packing a line is usually done outside the busy time to meet peak demands the next day. This method, however, provides only a short-term, short-term replacement for traditional underground storage.
Gasholders
Gas can be stored on the ground in a gasholder (or gasometer), mostly for balance, not long-term storage, and this has been done since Victorian times. It stores gas at district pressure, meaning that they can provide extra gas very quickly at peak times. Gasholders are probably the most widely used in the UK and Germany. There are two types of gasholder - guided by columns, guided by a constantly visible large frame, regardless of the holder's position; and spiral-guided, which has no frame and is guided by concentric runners in the previous elevator.
Perhaps, Britain's most famous gasholder is a colossally guided "gasholders oval" overlooking an Oval cricket field in London. Gasholders were built in Great Britain from early Victorian times; many, such as Kings Cross in London and St. Marks Street in Kingston on Hull are so old that they are completely transfixed, because their construction precedes the use of welding in construction. The last one built in England was in 1983.
Owner
Company interstate pipeline
International interstate pipeline companies rely heavily on underground storage for load balancing and system supply management on their remote transmission lines. The FERC Regulations despite requests that these companies open their remaining capacity are not used for that purpose to any third party. Twenty-five interstate companies currently operate 172 underground gas storage facilities. In 2005, their facilities accounted for about 43 percent of the overall storage delivery and 55 percent of the gas capacity working in the US. These operators include Columbia Gas Transmission Company, Dominion Gas Transmission Company, National Gas Gas Supply Company, Natural Gas Pipeline America, Texas Gas Transmission Company, Southern Star Pipe Company, TransCanada Company.
Company intravenous pipeline and local distribution company
Intravenous pipeline companies use storage facilities to balance operational and supply systems as well as to meet the energy demands of end-user customers. LDCs generally use gas from storage to serve customers directly. The group operates 148 underground storage areas and accounts for 40 percent of all storage deliveries and 32 percent of gas capacity working in the US. These operators include the Consumers Energy Company and Northern Illinois Gas Company (Nicor), in the US and Enbridge and Union Gas in Canada.
Independent storage service provider
The deregulation activity in the underground gas storage arena has attracted independent storage service providers to develop storage facilities. The available capacity will then be leased to third party customers such as marketers and electric generators. It is expected that in the future, this group will take up more market share, as more deregulation takes place. Currently in the US, this group accounts for 18 percent of overall storage submissions and 13 percent of US gas work capacity.
Location and distribution
Europe
As of January 2011, there are 124 underground storage facilities in Europe.
United States
The United States usually breaks into three major areas when it comes to gas consumption and production. It is consuming East, west consume and South produce.
Consuming East
The consuming eastern region, particularly the northern states, relies heavily on stored gas to meet peak demand during the winter months. Due to cold winters, large population centers and developed infrastructure, it is not surprising that this area has the highest working gas storage capacity of other areas and the largest number of storage sites, especially in run-off reservoirs. In addition to underground storage, LNG increasingly plays an important role in providing additional reserves and/or peak supply to LDCs in the short term. Although the total capacity for these LNG facilities is incompatible with underground storage capacity on this scale, high short-term delivery can be made for it.
Consuming West
The consuming western region has the smallest portion of gas storage both in terms of number of sites as well as capacity/gas deliverability. Storage in this area is mostly used to allow domestic gas and Albertan, originating in Canada, flows at a rather constant rate.
South Producing
The storage facilities in the south of production are linked to the market center and play an important role in the efficient transmission, exports and distribution of natural gas produced to the consuming areas. This storage facility allows gas storage that is not immediately marketed for storage for later use.
Canada
In Canada, the maximum working gas saved is 456 ÃÆ'â € 10 9 Ã, cuÃ, ft (1,29 ÃÆ' - 10 10 m 3 ) in 2006. Alberta storage accounts for 47.5 percent of total volume of working gas. This was followed by Ontario contributing 39.1 per cent, British Columbia contributing 7.6 per cent, Saskatchewan contributing 5.1 per cent and finally Quebec contributing 0.9 per cent.
Rules and deregulation
United States
US interstate pipeline companies are subject to the jurisdiction of the Federal Energy Regulatory Commission (FERC). Prior to 1992, these companies had all the gas flowing through their systems. It also includes gas at their storage facility, where they have full control. Then FERC Order 636 is implemented. This requires companies to operate their facilities, including open access gas storage. For gas storage, this means that these companies can only order the capacity needed to maintain system integrity. The remaining capacity will be available for leasing to third parties on a non-discriminatory basis. Open access has opened up various applications for gas storage, especially for marketers who can now take advantage of price arbitrage opportunities. Any storage capacity will be priced at a cost-based price, unless the provider can point to the FERC that it has no market power, which in this case may be allowed for a market-priced price to gain market share. FERC defines market power as "a profitable seller's ability to keep prices above competitive levels for significant periods of time." The underlying pricing structure for storage has hampered development in the gas storage sector, which has not seen many new storage facilities being built, in addition to those currently being expanded. In 2005, the FERC announced a new Order 678 targeted specifically for gas storage. This rule is intended to stimulate the development of new gas storage facilities in the final goal of reducing the volatility of natural gas prices. Commission Chairman Joseph T. Kelliher observed: "Since 1988, natural gas demand in the United States has increased 24 percent.In the same period, gas storage capacity has increased by only 1.4 percent.While the construction of storage capacity has lagged behind the demand for natural gas, we have seen a record level of price volatility.This indicates that the current storage capacity is not adequate.Furthermore, this year, what storage capacity may be full much earlier than in the previous year.According to some analysts, which increases the prospects that some domestic gas production may be closed.Our last rule should help reduce price fluctuations and expand storage capacity. "The ruling aims to open two approaches for natural gas storage developers, to be able to charge market-based tariffs. The first is the redefinition of the relevant product market for storage that includes alternatives to storage such as available pipe capacity, local gas production and LNG terminals. The second approach aims to implement section 312 of the Energy Policy Act. This will allow the applicant to request the authority to fill "market-based tariffs even if the lack of market power has not been proven, in circumstances where market-based rates are in the public interest and necessary to encourage storage capacity development in areas requiring storage services and that customers are protected adequate, "said the Commission. It is expected that this new order will attract developers, especially independent storage operators, to develop new facilities in the near future.
Iran
The Underground Gas Storage Company, as a subsidiary of the National Gas Company of Iran, was established in 2007 with the following objectives:
- Organize, speed up, and forward all projects that are in progress by Natural Gas Storage Management
- Implementation of new projects and plans
- Implementation of the necessary studies with a view to finding potential new viable gas storage in different parts of the country that will transform into new plans and projects once approved. 6/30/2009
Sarajeh Reservoir
Sarajeh reservoir depletes the storage capacity of a 3/3 billion cubic-meter hydrocarbon reservoir of natural gas, the company said. The storage capacity of the project to remove gas stored in the reservoir during the third phase follows these considerations. - Phase 1: 10 million cubic meters of gas per day - Phase 2: 20 million cubic meters of gas per day - Phase 3: 30 million cubic meters of gas per day. This project started at the end of 86 years from the date of 10/17/85, 16% and 54% of the initial installation of goods has grown. After 87 years at the end of the company's natural gas storage development project, the installation of each item supplied to 84% is achieved. The electricity supply operation at the end of the project has not improved in 86 years by the end of the year 87 5/96% achieved. The design of gas injection project, installation and commissioning of gas injection compressor 87 to about 3/9% have been developed.
Shurijeh gas storage tank project
Gas storage tank project in Shurijeh. The tank capacity is approximately eight quarters and the ability to produce 40 billion cubic meters. Gas there and run the following phases of the project have been considered: - First phase 10 AD. CE. M.. Injection 20 m. CE. CE. - Phase II 20 m. M.. M.. R. injection and 40 mm
Canada
In Alberta, gas storage rates are not regulated and providers negotiate tariffs with their customers under contract per contract. But the Carbon facility owned by ATCO gas is regulated, because ATCO is a utility company. Therefore, ATCO Gas must charge a fee based on its cost to its customers, and may market any additional capacity at market-based rates. In Ontario, gas storage is regulated by the Ontario Energy Board. Currently all available storage is owned by a vertically integrated utility. Utility companies should set the price of their storage capacity sold to their customers at a fee-based rate, but can market the remaining capacity at market-based rates. Storage developed by independent storage developers can charge market-based rates. In British Columbia, gas storage is not regulated. All available storage capacities are marketed at market-based prices.
United Kingdom
Gas storage, transportation and sales arrangements are overseen by Ofgem (government regulator). This has happened since the gas industry was privatized in 1986. Most forms of gas storage are owned by Transco (now part of the National Network plc), but the national network now has largely been split into regional networks, owned by different companies. However, they can all still be answered by Ofgem.
Economic storage
Storage development costs
As with all infrastructure investments in the energy sector, the development of storage facilities is capital intensive. Investors typically use the return on investment as a financial measure for the sustainability of the projects. It is estimated that investors need a rate or return of between 12 percent and 15 percent for regulated projects, and nearly 20 percent for unregulated projects. Higher expected returns from unregulated projects are due to the perceived higher market risk. In addition, significant costs are accumulated during the planning and location of potential storage areas to determine their suitability, which further increases the risk.
Capital expenditures for building facilities largely depend on the physical characteristics of the reservoir. First of all, the cost of developing a storage facility depends largely on the type of storage area. As a general rule, salt caves are the most expensive to be developed on Bcf from Gas Work Capacity Bases. But keep in mind that because the gas at the facility can be cycled repeatedly, based on Deliverability, they may be cheaper. The Salt Cavern facility may cost between $ 10 million and $ 25 million/Bcf of gas-functioning capacity. The wide range of prices is due to the different regions that determine the geological requirements. These factors include the amount of horsepower required, the type of surface and the quality of the geological structure to name a few. A reservoir costing between $ 5 million to $ 6 million/Bcf Gas Working Capacity. Finally, another major cost incurred when building a new storage facility is the gas base. The amount of alkaline gas in the reservoir can be as high as 80% for the aquifer makes it very unattractive to develop when the gas price is high. On the other hand, salt caves require the least amount of alkaline gas. The high cost of alkaline gas is what drives current location expansion vs. new development. This is because expansion requires a little extra for the alkaline gas.
The expected cash flows from these projects depend on a number of factors. This includes the services provided by the facility as well as the regulatory regime in which it operates. Facilities that operate primarily to capitalize on arbitrage commodity opportunities are expected to have different cash flow benefits than those primarily used to ensure seasonal supply reliability. The rules set by the regulator may either limit the profit made by the owner of the storage facility or on the other hand guarantee the profit, depending on the market model.
Storage values ​​
To understand the economy of gas storage, it is important to be able to appreciate it. Several approaches have been proposed. They include:
- Service cost assessment
- Low cost planning
- Seasonal Valuation
- Rating by option
Different assessment modes coexist in the real world and are not mutually exclusive. Buyers and sellers typically use different price combinations to generate actual storage values. Examples of different ratings and prices they produce can be found in the table below.
Cost-of-service assessment
This assessment mode is commonly used to assess regulated storage, such as storage operated by interstate pipeline companies. These companies are governed by FERC. This pricing method allows the developer to recover the agreed cost and return on investment. The regulatory body requires that tariffs and rates be maintained and publicly published. Services provided by these companies include robust, easy-to-disable storage and unannounced storage services. Typically, the cost of service fees is used for reservoir facilities that are exhausted. If used for the price, say the formation of the caves, the cost will be very high, due to the high cost of developing the facility.
Low cost planning
This assessment mode is commonly used by local distribution companies (LDCs). It is based on the storage of prices, in accordance with the savings resulting from not having to use other more expensive options. This pricing mode depends on the consumer and their respective profile/shape of charge.
Seasonal Valuation
Seasonal storage valuations are also referred to as intrinsic values ​​. It is evaluated as the difference between two prices in a pair of forward prices. The idea is that one can lock the spread forward, both physically and financially. For developers who want to learn the feasibility of building a storage facility, they will usually see long-term price spreads.
Option-based assessment
In addition to having intrinsic value, storage can also have an extrinsic value. Assessment of storage intrinsically does not take cycling capability from high shipping storage. Extrinsic assessment reflects the fact that in the facility, say cave formation, the proportion of space can be used more than once, thus increasing the value. High-speed storage facilities allow users to respond to demand/price variations in a season or during a particular day rather than just seasonal variations as well as single-cycle facilities.
The effect of natural gas prices on storage
In general as we see in the graph below, high gas prices are usually associated with low storage periods. Usually when prices are high during the early months of the recharge season (April-October), many storage users adopt a wait-and-see attitude. They limit their gas intake in anticipation that prices will drop before the warm-up season begins (November-March). However, when the decline did not occur, they were forced to buy natural gas at a high price. This is especially true for Local Distribution and other operators who rely on storage to meet seasonal demand for their customers. On the other hand, other storage users, who use storage as a marketing tool (hedging or speculation) will delay saving lots of gas when the price is high.
The future of storage technology
Research is underway in many areas in the field of gas storage to help identify new, better and more economical ways to store gas. Research conducted by the US Department of Energy shows that salt formation can be cooled to allow more gas to be stored. This will reduce the size of the formation that needs to be treated, and have the salt taken from it. This will lead to cheaper development costs for this type of salt formation storage facility. Another aspect to be seen, is another formation that might hold gas. These include hard rock formations such as granite, in areas where such formations exist and other types currently used for gas storage are not. In Sweden a new type of storage facility has been built, called the "stone cave lined". This storage facility consists of installing a steel tank inside a cave in a rocky hillside and encircling it with concrete. Although the cost of developing the facility is quite expensive, its ability to cycle gas repeatedly compensates it, similar to a salt forming facility. Finally, another research project sponsored by the Department of Energy, is hydrate. Hydrates are compounds that form when natural gas freezes in the presence of water. The advantage is that as much as 181 cubic feet of natural gas can be stored in a cubic foot of hydrate.
See also
- Natural gas
- Natural gas price
- Natural gas processing
- Carbon dioxide (CO 2 )
- Compressed natural gas (CNG)
- Fuel station
- Future energy development
- Gasholder
- Hydrogen storage
- Liquefied natural gas (LNG)
- List of North American natural gas pipelines
- Underground hydrogen storage
- Steam reform
- Resources and world energy consumption
External links
- Cedigaz - UGS Worldwide Database
- EIA - Energy Information Administration - Topics for Natural Gas Storage
- FERCÃ, - Federal Energy Regulatory Commission - Natural Gas Storage
- Natural Gas Media - Natural Gas News and Analysis for Investment and Commerce
References
Source of the article : Wikipedia
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