Underground Gas Storage Market: Overview
The rate at which the natural gas is consumed fluctuates from day to day. The demand of the natural gas is quite high in the winter season as compared to the summers. The underground gas storage industry has borrowed much of its technology from oil and gas exploration, gas distribution and ground water utilization. Underground natural gas storage consists of a wide network of pipelines, local distribution companies and producers with an inventory management tool. In order to cope with the rising demand of energy the back up for the energy resource has to be maintained. With the rising demand of natural gas the industry for underground storage industry is growing at a healthy rate.
Diminishing fossil fuel reserves and increasing energy security concerns are the major drivers for the underground gas storage market. The concerns regarding energy security plays an important role in the storage industry as every country is focused on the uninterrupted and continuous energy supply. Cost of setting processing units and maintenance costs are the major drivers for the underground gas storage market. The increasing demand for energy and exploration of new gas reserves adds new opportunities for the existing and new market players to invest in the underground gas storage market.
Underground Gas Storage Market: Segmentation
The underground gas storage market can be segmented on the basis of type of storage used for storing gas. Gas can be stored in the depleted oil or natural gas fields, aquifers and salt caverns. The gas in the storage facility is stored in the same location where it was naturally found. Natural gas is usually found in porous rocks locked up in the pores with a maximum diameter of 0.1 mm between the grain and the sand stones. Conversion of production fields into storage fields takes advantage of existing wells and pipeline networks.
Depleted oil and gas reserves are widely used as underground storage units because of their availability in abundance. In few areas natural aquifers are also converted into gas storage facilities. An aquifer is best suited for gas storage, if the sedimentary rocks are overlapped by the impermeable rock cap. As the geology of the aquifers are same as the depleted oil and gas reserves, their use in gas storage requires greater amount of gas and greater supervision of injection and withdrawal performance. Salt caverns deliver high injection and withdrawal rates for the gas storage capacity. Base gas requirements are generally low in salt caverns as compared to aquifers.
Majorly all the of salt cavern storage facilities are constructed in salt dome formations. The cost of construction of salt caverns is high when compared to depleted oil and natural gas reserves, but the ability to perform several injection and withdrawal cycles reduces the cost associated with per thousand cubic feet of gas injected and withdrawal.
Underground Gas Storage Market: Regional Insights
At the global level, approximately 688 underground gas storage facilities are in operation. In the North American region the United States with 414 underground storage units followed by Canada with 59 storage units. The European region holds the second rank on the list with 144 underground storage units. The Asia pacific region has 18 underground storage sites.
Key players in the underground gas storage market are Niska Gas Storage, Saltville Gas Storage, Floridian Natural Gas Storage Company, LLC, TransCanada, Gazprom and Enbridge Inc, and others.