Tokyo, JAPAN. Study group 2.2. Life Cycle of UGS. Working Committee 2 (UGS) International Gas Union nd World Gas Conference, Tokyo, Japan

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1 22 nd World Gas Conference Tokyo, JAPAN Study group 2.2 Life Cycle of UGS Working Committee 2 (UGS) International Gas Union 1

2 Slovakia France Austria Germany Russia Study Group Members Wicquart Wallner Jan, study leader Kalo_aj Pavol, assistent Daniel Bourjas / Pierre Marion / Emmanuelle Gernold Weissenboeck / Pawel Siemek Wilhelm Gilch Alexander V. Grigoriev Italy Massimo Moschini / Roberto Bonaventura D Amico / Alberto Succetti 2

3 Contents 1. UGS Life Cycle Phases 2. General Planning Questions, Public Relations, Permissions 3. Advanced Exploration Methods 4. Cost Reduction Potential 5. Decommissioning Of Storage Facilities 6. Recommendations 3

4 Based on the experience the following phases i n t h e " L i f e C y c l e " o f U G S c a n b e distinguished: UGS Life Cycle Phases Feasibility Study phase Geological exploration phase Planning phase Construction phase Operation phase Decommissioning phase 4

5 Phases of a new UGS project development Construction Operation Planning Geological Exploration Decommissionning Feasibility Study 5

6 Lead times for a new UGS project development UGS Type Depleted Aquifer oil and gas Salt caverns structures Phase fields Feasibility Study 0,25-2,00 0,75-2,00 0,30-2,00 Geological exploration 0,50-1,50 1,50-5,00 1,00-3,00 Planning 0,50-2,00 0,75-3,00 0,75-2,00 Storage construction 0,75-1,50 2,00-4,00 3,00 )* Total 2,00-7,00 5,00-14,00 5,05- )** Notes: )* average leaching time for m 3 cavern )** depends on number of caverns, leaching rate, brine disposal... [years] 6

7 Contents 1. UGS Life Cycle Phases 2. General Planning Questions, Public Relations, Permissions 3. Advanced Exploration Methods 4. Cost Reduction Potential 5. Decommissioning Of Storage Facilities 6. Recommendations 7

8 Scheme of necessary agreements & permissions 1. Civil law agreement between owners and gas company 2. Permission for gas storage in the selected reservoir (mining authority) Noise prevention guideline Guideline for protection against fire Protection law for water Protection law for air Health and safety regulations Protection law for nature conservan 3. Civil law agreement between gas company and landowner 4. Permission for drilling and well completion (mining authority) 5. Permission for underground gas storage operation (mining authority) 6. Underground gas storage monitoring (mining authority + official experts) 8

9 Contents 1. UGS Life Cycle Phases 2. General Planning Questions, Public Relations, Permissions 3. Advanced Exploration Methods 4. Cost Reduction Potential 5. Decommissioning Of Storage Facilities 6. Recommendations 9

10 Scope and methods applied for exploration of geological formations depend on: existing knowledge storage type : Advanced Exploration Methods Converting depleted gas/oil deposits data are available from the former exploration works of the deposits and from the gas/oil production phase Aquifer structures all data/information for technical facilities planning have to be estimated by exploration works 10

11 Porous reservoirs Geological and structural configuration of the reservoir Petrographic characteristics of the reservoir rock Petrophysical and sealing characteristics of the cap rock Sealing characteristics of the cap rock: thickness Petrografic and the structure parameters of the cap rock, Stress of porosity the cap and rockwater saturation of the reservoir rock Fracture rock pattern capillarity Mechanical permeability characteristics. of the reservoir rock reservoir rock consolidation net/gross ratio of the reservoir thickness 11

12 Geological / Reservoir model 12

13 Geological / Reservoir model Grid of 3D Model Grid ofhe Model 13

14 Advanced Exploration Methods The standard techniques: seismic and appraisal wells to define the geological model, core and loganalyses for petrographical/petrophysical investigations, reservoir simulation model based on the dynamic information acquired from gas/oil fields during primary production phase The most advanced technologies: 3D and 4D seismic to define the better structural and geological description, horizontal drilling to increase deliverability, injection/production and interference tests to characterize the reservoir dynamic model. 3D reservoir simulation to determine the optimum gas storage potential and the optimum number and location of additional operation wells. 14

15 Contents 1. UGS Life Cycle Phases 2. General Planning Questions, Public Relations, Permissions 3. Advanced Exploration Methods 4. Cost Reduction Potential 5. Decommissioning Of Storage Facilities 6. Recommendations 15

16 Cost Reduction Potential The biggest cost reduction potential are seen at the overlapping phases Planning and Exploration, followed by Commissioning, Construction, Operation and Phases Summary Decommissioning. Exploration 2 Priorities of the cost reduction impact (the highest priority = 1) Planning Construction Commissioning Operation Decommissioning

17 Planning Phase Potentials Cost reduction potential PORE SPACE STORAGES Increasing tubing diameter (>5 ) increasing withdrawal rate (up to 50%) Drilling horizontal wells increasing withdrawal rate (up to 300%) Increasing max. reservoir pressure increasing withdrawal rate (by 10-35%) Utilization of inert gas for cushion gas cost reduction for cushion gas (up to 20%) 17

18 Cost reduction potential CAVERN STORAGES Planning Phase Potentials Integrated pressure/temperature models reduction for planning phase (up to 30%) Dimensioning max. cavern volume lower investment cost (up to 35%) Increasing max./decreasing min. pressure increasing of the working gas (up to 15%) Gas velocity >25m/sec increasing withdrawal rates (up to 35%) 18

19 Typical Distribution of Investment Elements Dehydration 8% Compression 16% Piping 6% Auxiliary units 7% Cushion gas 27% Buildings 6% Wells 23% Others 7% UGS in Depleted Fields 19

20 Typical Distribution of Investment Elements Dehydration 7% Compression 13% Piping 4% Auxiliary uni 5% Buildings 5% Cushion gas 27% Others 6% Wells 33% UGS in Aquifers 20

21 Typical Distribution of Investment Elements Compression 18% Dehydratation 8% Piping 4% Auxiliary units 3% Buildings 6% Leaching 32% Cushion gas 12% Others 2% Wells 15% UGS in Salt Caverns 21

22 Contents 1. UGS Life Cycle Phases 2. General Planning Questions, Public Relations, Permissions 3. Advanced Exploration Methods 4. Cost Reduction Potential 5. Decommissioning Of Storage Facilities 6. Recommendations 22

23 Decommissioning The decommissioning of storage facilities using progressive methods minimises costs under the conditions of maximum safety, which are in compliance with high environmental requirements/standards. 23

24 Decommissioning A significant number of UGS has being in operation for more than years. New trend Decommissioning of UGS especially for economical reasons 12 storages world wide 3 storages in Europe 24

25 Decommissioning Common character of the abandoned storages: Aquifers shallow reservoirs < 300 m working gas volume < 150 Mil. m_ necessary wells > 35 Decommissioning phases (Porous reservoirs) residual gas production (cushion gas), abandonment of wells, abandonment of surface facilities, evaluation of mining safety for long-term conditions. 25

26 Contents 1. UGS Life Cycle Phases 2. General Planning Questions, Public Relations, Permissions 3. Advanced Exploration Methods 4. Cost Reduction Potential 5. Decommissioning Of Storage Facilities 6. Recommendations 26

27 General recommendations development in several phases Recommendations permanent comparison of the reached results with project s goals trustfull co-operation with the population in catchment area extension of existing storage facilities instead of new projects cycling several times per year considerably increases storage efficiency 27

28 General Technical Recommendations utilisation of existing seismic measures Recommendations 3D seismic should be used for complex geological structures detailed Final Report for the Exploration phase forms the basis for an optimum Planning phase 28

29 Recommendations Special Technical Recommendations For porous reservoirs: inert gas as cushion gas maximum storage pressure over the initial reservoir pressure horizontal wells enlargement of the tubing diameter >5 For salt caverns: integrated pressure/ temperature models for planning cluster wells in situ tests for determination of max. operation pressure developing of max. cavern volume welded tubing and casing strings enlargement of tubing strings >9 5/8 29

30 Recommendations Decommissioningof UGS is relatively rare till now but inseparable part of UGS life cycle It would be an advisable approach to apply the procedures already validated in practice from initial phases 30

31 Conclusion UNDERGROUND GAS STORAGE SHOULD BE DESIGNED AND BUILT EFFECTIVELY AND RELIABLY TO PROVIDE COMMERCIAL SERVICES REQUESTED. THE STATE-OF-ART KNOW-HOW IN ALL PHASES OF UGS LIFE MUST BE USED. 31