1. UNDERGROUND STORAGE OF NATURAL GAS
- AN OVER VIEW

2. Overview
Availability of energy at a steady rate and at a reasonable cost are vital for sustainable economic development of India.
Two basic reasons, why the use of natural gas as fuel source is expected to increase:
Natural gas is environment friendly
Reserves of natural gas are comparable to those of crude oil with much lower consumption levels, accordingly, natural gas could last longer than crude oil.

3. Overview
With about 8% current energy consumption contributed through natural gas, the projected demand is estimated to grow about 5% per annum upto 2025.
Projected demand for power generation and fertiliser plants is expected to grow manifold.
Energy outlook of India is on a definite transformation owing to recent gas finds.

4. Projected Gas Demand 2011-12 2020 2030 X Plan Estimates 64 BCM
India Vision 2000
65-71 BCM
HC Vision 2025
114 BCM
143 ( ) BCM
IEA
75 MMTOE
97 MMTOE
IRADe-PwC
116.9 BCM
218.7 BCM
Source: : IRADe-PwC Report Fuelling India’s Future (Early 2008 figures)

5. Energy Security Intensive exploration for oil & gas through NELP
Exploration by national oil companies
Increasing recovery of oil & gas from existing fields by EOR technique
Exploring for alternative sources of hydrocarbons such as CBM, Gas Hydrates etc.
Acquisition of equity oil abroad
Augmentation of gas supply through import of LNG & trans national gas pipelines
Creating strategic & commercial reserves

6. Why Strategic & Commercial Storage of Natural Gas?
Spurt in development & usage of CNG, both for transportation sector and domestic markets.
Disruptions in gas supply through proposed trans national pipelines
In line with the energy security mandate of common minimum programme of Govt. of India.
Strategic & commercial storage of natural gas will cater fluctuation in demand, besides providing a buffer against natural disasters, war or similar events that may affect the production or supply of natural gas.

7. Gas Infrastructure Drivers
Industrial sectors
Automotive sectors
Residential + Commercial sectors
Gas based power generation
Fertilizer plants

8. Studies, so far
In pursuance of the objective of creating strategic storage of natural gas, Ministry of Petroleum & Natural Gas (Govt. of India) has already initiated action.
Engineers India Ltd. was assigned the task of preparation of the Pre-Feasibility Report. The PFR has been submitted to MoPNG /OIDB and is under active consideration on Govt. of India for further progress on the subject.

9. International Scenario
Over 400 Natural gas storages in U.S.A.
Over 600 Natural gas storages world wide
450 nos. in Depleted Reservoirs
80 nos. in Deep Aquifers
70 nos. in Salt Caverns

10. World Gas Storage Capacity – 340 MM m3

11. World Gas Storage Capacity – Volume Distribution

12. USA Gas Storage Capacity – Volume Distribution

13. USA Gas Storage Capacity – Volume Distribution
Total Storage Capacity, MMcf 8,255,042
Salt Caverns 2.9% 239,990
Aquifers 15.0% 1,238,158
Depleted Fields 82.1% 6,776,894
Total Withdrawal Capacity, Bcf/d 76
Total Number of Active Fields 393
Salt Caverns 7.6% 30
Aquifers 11.0% 43
Depleted Fields 81.4% 320

14. USA Gas Cavern Working Capacity
Source: US Energy Information Agency

15. USA Gas Cavern Inventory Levels
Source: US Energy Information Agency

16. Surface Vs. Underground Storage
Do not meet safety requirements to withstand enemy attacks during wars
Vulnerable to fire hazards as a result of mal-operations and accidents
Occupy large area of valuable land
UNDERGROUND
Have inbuilt safety to withstand attacks during wars
Resistant to fire hazards
Economical for larger capacities

17. Types of Sub-surface Storage of Gas
Natural Gas
Coal Gas
H2, CO2 , CO, etc.
Porous Media
Void Space
Abandoned Mines
Depleted Reservoirs
Deep Aquifers
Salt Domes
Salt Layers
Oil Fields
Gas Fields
Mined Caverns
Dissolved Caverns

18. Underground storage of Natural Gas
Total gas storage capacity is the maximum volume of natural gas that can be stored at the storage facility.
Base gas (also referred to as cushion gas) is the volume of gas that is intended as permanent inventory in a storage reservoir to maintain adequate pressure and deliverability rates throughout the withdrawal season.
Working gas capacity is the total gas storage capacity minus the base gas.

19. Underground storage of Natural Gas
Physically unrecoverable gas is the amount of gas that becomes permanently embedded in the formation of the storage facility and that can never be extracted.
Cycling rate is the average number of times a reservoir’s working gas volume can be turned over during a specific period of time. Typically the period of time used is one year.

20. Schematic Diagram for Storage Types
The principle of storage in depleted reservoir is simple, because the reservoir formerly contained gas or oil. Hence it satisfies the permeability & porosity conditions required for storage.
However, before developing a gas storage in a depleted field, it is indispensable to check whether it corresponds to required withdrawal rate and imperviousness of the cap rock.
DEPLETED OIL / GAS RESERVOIR

21. Schematic Diagram for Storage Types
The predominant type of underground storage of natural gas consists of depleted gas / oil reservoir.
This type of storage is the cheapest and easiest to develop, operate and maintain.
The cushion gas for depleted reservoir storage option is high (about 50%).
DEPLETED OIL / GAS RESERVOIR

22. Schematic Diagram for Storage Types
The principle of storage in salt caverns involve dissolving salt with fresh water and removing the brine through a process, called as Solution Mining.
However, before developing a gas storage in a salt formation, establishment of its geologic characteristic features determining its suitability is important.
SALT CAVERN

23. Schematic Diagram for Storage Types
Underground salt formations both salt domes / bedded salt formations offer option of natural gas storages called as salt cavern storages.
Though the process of creating the cavern is relatively expensive, once created the salt caverns offer a high deliverability. The cushion gas component in this option is low (about 30%).
SALT CAVERN

24. Schematic Diagram for Storage Types
The principle of storage in deep aquifers is to create an artificial gas field by injecting gas into the voids of an aquifer formation.
Therefore, geologic conditions such as an anticline with sufficient closure, a porous and permeable reservoir and excellent quality cap rock are prime requisites.
DEEP AQUIFER

25. Schematic Diagram for Storage Types
Deep Aquifer formations need confirmation to be used as natural gas storage.
As these facilities are more expensive than the depleted reservoir types, the deep aquifer storages are usually taken up in areas where there are no depleted reservoir options and that the sub-surface geology of the area suits the requirements.
DEEP AQUIFER

26. Underground storage of Natural Gas
underground storage of natural gas is mainly located within Sedimentary Basins

27. Sedimentary Basins of India
Sedimentary Basins of India occupy 3.14 M Sq.Km.
0.39 M Sq. Km. is in Offshore up to 200m water depth.
1.35 M Sq. Km. is in deep waters beyond 200m.
1.40 M Sq. Km. is in Onshore.
Source : DGH
India is endowed with 26 major sedimentary basins of an estimated 50,000m thick Sediments.

28. Aspects for Storage Performance
Verification of Inventory (Capacity)
Containment against Migration (Operating Parameters)
Assurance of Deliverability (Efficiency)

29. Approach for Regional Assessment
Reconnaissance Survey
Regional Geological Setting
Regional Ground Water Table

30. Parameters vis a vis Types of storages
Anticlinal Geometry
Stratigraphic Lenses
Faults / Structural Traps
Deep Aquifers
Salt Caverns
Depleted Reservoirs
Self Healing Salt Formations
Depleted / Marginal Reservoirs

31. Reservoir Characteristics
Porosity
Directional Permeability
Vertical Migration
Horizontal Migration

32. Reservoir Characteristics
Porosity Permeability in % in milli darcies
Storage Media ,000
Sand Stone
Fractured Limestone
Impervious Caprock zero
Shale
Limestone
Anhydrite

33. Critical Issues for Deep Aquifers/Depleted Reservoirs
Geometric Shape
Inverted Saucer preventing vertical and lateral migration
Caprock Matrix
Permeability, Porosity and Threshold Pressure
Continuity
Freedom from anomalies
Leakage Detection
Tracer Study

34. Salt Cavern Storage Features Large volume
Hydrocarbon liquids & gas, compressed air, hydrogen
Impermeable containment
Advantages
Less costly (larger scale)
Excellent physical security
Lower environmental impacts
Disadvantages
Geological limitations
Longer to construct

35. Salt Cavern Storage Benefits for natural gas storage
Salt provides an impervious barrier
Very high deliverability
Good [ working gas : total gas ratio ]

36. Key Design Elements - salt cavern storage
Cavern and well integrity
Geomechanical stability
Salt creeping and convergence
Cavern separation
Surface subsidence
Maximum operating pressure
Minimum operating pressure
Cavern shape, roof span
Web or pillar width

37. Typical Salt Cavern Storage Characteristics
Bedded Salt Caverns
Size
50 000B to 1 MMB
Depth
Top of Salt: 500’ – 1,000’
Depth to Roof: 500’ – 3,000’
Short and Squat
Cavern Height: 30’ - 300’
Diameter: 75’ – 300’
Domal Salt Caverns
Size
2 to 15 MMB (& larger)
Depth
Top of Salt: 500’ – 2,000’
Depth to Roof: 2,000’ – 4,000’
Tall & Slender
Cavern Height: 500’ – 2,500’
Diameter: 75’ – 300’

38. Salt Dome Storage

39. US Salt Deposits
DOMAL
BEDDED

40. Attributes of Underground Storage
Large Aquifer offers the maximum potential storage capacity.
Deliverability from a Salt Cavern Storage is rated higher than other options
Therefore, when the two storage attributes, the Inventory (capacity) and the Deliverability are considered in relation to specific requirements of energy markets, it is clear that both Aquifer storage and Salt cavern storage command their respective justifications in economic desirability.

41. Underground Storage of Gas
Terminaling
Storage
Transmission
Trans-National Pipelines
Trans-shipment of LNG Through Sea Port
Underground Strategic / commercial Storage
National Gas Grid
Access Pipelines to the Grid
Regional Underground Storage Hubs

42. Strategic /Commercial Storage of Natural Gas
Present consumption is about 65 MMSCMD (as of 2008) of natural gas supplied to the consumers.
About 40% of NG is used for power generation,
28 % for fertilizer and balance
32% for uses such as industrial, residential etc.
The 10th Plan document predicted increase in natural gas consumption from present 65 MMSCMD to 130 MMSCMD- double the consumption level in five years.
Vision 2025 document envisages consumption level of Natural Gas is expected to rise to 391 MMSCMD.

43. National Gas Grid
Development of Strategic / Commercial Gas Storage along with National Gas Grid will cater to energy integration of the nation.

44. Pre-Feasibility Studies
Based on the geology of the Indian sub-continent, and with a design basis that all strategic gas inventories should be located as near as practical to existing and planned gas transmission pipelines, initially ten prospective areas were identified :
Based on the desk studies of available literatures, geological maps etc. seven sites were retained for further studies.
The seven sites were comparatively ranked using a weighted scale of evaluation factors, where in the first four sites have been subsequently selected and are ranked as follows:
1.      North Gujarat (Depleted / Marginal Reservoirs)
2.      Bikaner (Salt Cavern)
3.      Kota (Deep Aquifer)
4.      Bhubaneswar (Deep Aquifer)

45. Pre-Feasibility Studies
In order to maximize the storage capacities at each of the candidate sites to the extent possible, with the intention of storing the proposed 3 BSCM of natural gas at each site, an assessment was made through the PFR studies.
The study revealed that while it is possible to store 3 BSCM in salt caverns at Bikaner and in depleted reservoirs in North Gujarat individually, the maximum capacities at Kota & Bhubaneswar are of the order of 1250 MMSCM.
While a published report from Geological Survey India outlines a detailed account of the bedded salt formation reported in the North Western part of Rajasthan, a recent study by ONGC reveals the details of salt formation in and around Sri Ganganager Dist. Rajasthan.

46. Pre-Feasibility Studies
An attempt was made in this study, to identify the depleted reservoirs that could be made available for storage of natural gas. However, several operators have declined to part with the reservoirs in the anticipation of enhanced oil recovery.
Thus it has been suggested by MoPNG that a mechanism should be in place so as to define the depleted reservoirs through a due diligence and subsequent relinquishment.
As of the salt cavern storage, the MoPNG / OIDB observed that the possibility of locating both the crude oil and natural gas storages at Bikaner should be explored further.

47. Conclusion
In India, interest in under ground gas storage, which is a relatively recent technique, has been developing rapidly. It can become an essential part of the gas chain.
Stimulated by the changes taking place in the gas market, application of underground storage of natural gas is expected to intensify.
The expected growth in gas demand, increased dependence on imports and the growing need for flexibility will strongly influence future storage requirements.
In addition, the storage infrastructure is gradually offering new opportunities (new services, storage for third parties, storage for transit), enabling the owners of the facilities to strengthen their position on the market.

48. Thank You