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Natural Gas Processing and Handling

To cater to the seasonal highs and lows in demand throughout a year, natural gas is stored in underground storage facilities. The need for such facilities arose because increasing (or decreasing) gas production to mirror changes in demand is ­neither practical nor economical. Therefore, gas is produced and stored during low-demand times and retrieved to meet the highs during winters. This cyclic trend can be observed also in gas-storage inventories [as reported by the Energy Information Administration (EIA)]. The northeast US has the highest concentration of such storage facilities, close to the biggest market.

Most of the underground gas-storage facilities are depleted reservoirs, but aquifers and leached salt caverns are also used. The US and Canada were the pioneers in realizing the potential of depleted reservoirs for gas storage and, hence, have several well-developed facilities. What makes depleted reservoirs attractive is the presence of existing wells used to produce the reservoir, plus the geologic and engineering knowledge acquired during the development of the field. All that information is leveraged when repurposing the field for gas storage. Depleted reservoirs also contain some amount of gas already in the reservoir, which decreases the requirement to inject gas as cushion gas. (Cushion gas is immobile gas that remains in the reservoir and allows the reservoir to be used for storage.) Depleted reservoirs are also the most abundant.

I would be remiss not to touch upon the Aliso Canyon incident of 2015. Aliso Canyon was the second-largest storage facility in the US at the time. The industry learned a harsh lesson about the repercussions when containment is lost for such facilities. The loss of containment was because of the casing failure of one of the wells (along with having subsurface safety valves removed in the past). This led to 109,000 tonnes of methane emissions by some estimates. One measure that was proposed to reduce such risks is to use offshore reservoirs nearing abandonment for gas storage (instead of onshore ones that are close to populated urban areas).

At the time of this writing, the week-to-week change in the natural gas storage inventory was –237 Bcf, and levels remained lower than the 5-year historical average, according to the EIA. This withdrawal from the inventory was less than most forecasts based on the extreme cold temperatures faced by the US. The Henry Hub natural gas prices reached highs of more than $4.5/million Btu in 2018 because of record gas demand. The price has since dipped to $2.57/million Btu because of abatement in the extreme weather leading to lower demand for heating.

To learn more, visit the SPE Annual Technical Conference and Exhibition in Calgary, 30 September–2 October, and the Gastech Exhibition and Conference in Houston, 17–19 September.

This Month's Technical Papers

Mature Fractured Reservoirs Can Be Repurposed for Gas Storage

New Gas-Separation Technology Reduces Cost, Weight, and Footprint Significantly

Novel Approach to Sour-Gas Treatment Reduces Cost, Safety Hazards

Recommended Additional Reading

SPE 190838 SPE Comprehensive Evaluation of the Dynamic Sealing Capacity of Clayey Caprocks in a Large Underground Gas Storage by Junchang Sun, PetroChina, et al.

SPE 192961 Maintaining Flare-Tip Health by Venugopal Bakthavachsalam, ADNOC, et al.

SPE 192783 Cutting-Edge Solutions for Sour-Gas Treatment: A Retrospective Study by Kuwait Oil Company by Fahad Al-Ghanem, Kuwait Oil Company, et al.

Ehsaan Ahmad Nasir, SPE, is a reservoir engineer at Baker Hughes, a GE company. He has been with Baker Hughes since 2012. Nasir is currently deployed in the US Permian geomarket. His experience includes evaluation of prospects for investment, production forecasting, statistical modeling using machine-learning methods, pressure- and rate-transient analysis, horizontal-multifractured-well production analysis, well-screening studies to identify production issues, data-mining studies in unconventional plays, and reservoir simulation. Nasir holds a master’s degree in petroleum engineering from Texas A&M University. He is a member of the JPT Editorial Committee and can be reached at ehsaan.nasir@bhge.com.

Natural Gas Processing and Handling

Ehsaan Ahmad Nasir, SPE, Reservoir Engineer, Baker Hughes, a GE Company

01 April 2019

Volume: 71 | Issue: 4

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