Global Underground Natural Gas Storage Market
was valued at USD 220
Billion in 2022 and is anticipated to project robust growth in the forecast
period with a CAGR of 4.5% through 2028. Natural gas is a versatile and widely
used energy source, employed in various sectors such as power generation,
industrial manufacturing, and residential heating. Unlike some other energy
sources like coal or oil, natural gas cannot be easily stored on-site in large
quantities. This necessitates the development of dedicated storage facilities. Underground
Natural Gas Storage facilities serve as a buffer during supply-demand
imbalances, ensuring a stable energy supply even during peak demand or supply
disruptions. In times of extreme weather or geopolitical tensions that affect
gas supply routes, these reserves become critical. Demand for natural gas often
varies seasonally, with higher consumption during winter for heating and lower
consumption during summer. Storage helps balance these fluctuations by storing
excess gas during low-demand periods and releasing it when needed. Underground
Natural Gas Storage plays a pivotal role in stabilizing gas prices. When supply
is abundant, excess gas can be stored, reducing the risk of price spikes.
Conversely, during supply shortages, stored gas can be injected into the market
to alleviate price pressures.
Key Market Drivers
gas has emerged as a leading primary source of energy because it burns cleaner
than other fossil fuels. It is widely adopted in various applications stressing
the demand for energy security by storing it in different forms. Natural gas is
stored during periods of lower demand and withdrawn during periods of higher
demand. The consumption of natural gas is strongly influenced by weather conditions,
especially during the winter season as it is used for space heating in
residential and commercial buildings. Stored natural gas plays a vital role in
ensuring that any excess supply delivered during the summer months is available
to meet the increased demand for winter months. Natural gas in storage imparts
energy security against the catastrophic disaster that may affect the
production or delivery of natural gas. In addition to serving those purposes, Underground
Natural Gas Storage is broadly adopted by industry participants for commercial
reasons. Storing gas when prices are low and withdrawing and selling it when
prices are high. Due to several other reasons and advantageous properties of
natural gas; it is essentially important to store natural gas.
Need of Underground Natural Gas Storage System
Underground Natural Gas Storage can be broadly
classified into the type of storing method; Aboveground Storage and Underground
Storage. The transportation and distribution of natural gas in above ground
storage can be done in the form of liquified natural gas (LNG) as it requires
less space compared to gaseous natural gas. Underground storage is further
divided into depleted gas reservoirs, aquifers, and salt caverns. The depleted
gas reservoir is the most common type of storage facility due to the capacity
to hold natural gas for future use and the rate at which gas can be withdrawn.
Depleted oil and natural gas reservoirs commonly used underground storage sites
because of their economic viability. Aquifers are porous, a permeable rock
formation that acts as natural water bodies. In certain conditions, these
natural water bodies are reconditioned to store natural gas. Aquifers are
expensive to develop and usually employed where there is no availability of
depleted gas reservoirs. The salt cavern is an artificial cavity created by
injecting water to dissolve the salt and offers the facility to store natural
gas. Natural gas not only offers an environmentally friendly form of energy but
also burns cleaner than other forms of fossil fuels turning it into the most
affordable and highly utilized fuel expanding the growth of the natural gas
storage. To meet the increasing demand for natural gas, storage is important to
offer energy security which drives the market of natural gas storage. A rigid
infrastructure is needed to store natural gas in a controlled environment. It
requires a huge periodic investment in operation and maintenance activities to
curb leak from storage tanks. Underground Natural Gas Storage is quite
expensive and criticality in transmission capacity is the restraints are
anticipated to hamper the growth of the Underground Natural Gas Storage market.
Download Free Sample Report
Underground Natural Gas Storage market is a critical component of the global
energy infrastructure, enabling the reliable supply of natural gas to meet
various energy needs. This market encompasses a range of storage facilities and
strategies designed to balance supply and demand, manage price fluctuations,
and ensure energy security. However, it is not without its share of challenges.
In this article, they will explore the Underground Natural Gas Storage market,
its significance, the types of storage facilities, and delve into the key
challenges it faces. Natural gas is a versatile and widely used source of
energy, playing a crucial role in various sectors, including electricity
generation, heating, and industrial processes. Unlike some other forms of
energy, natural gas cannot be easily stored at the point of production or
consumption in sufficient quantities to meet fluctuating demand. Therefore, the
development of dedicated storage facilities is essential. The significance of
the Underground Natural Gas Storage market can be summarized as follows:
Security: Underground Natural Gas Storage facilities act as a buffer during
supply-demand imbalances and unexpected disruptions. They provide a reserve
that can be tapped into during extreme weather conditions or geopolitical tensions
affecting gas supply routes, ensuring a consistent energy supply.
Seasonal Demand: Demand for natural gas often varies seasonally, with higher
consumption during the winter months for heating and lower consumption during
the summer. Storage facilities allow excess gas to be stored during periods of
low demand and released when needed, helping to balance these fluctuations.
Stabilization: Underground Natural Gas Storage helps stabilize gas prices by
absorbing excess supply during periods of oversupply and releasing stored gas
during shortages. This helps prevent extreme price fluctuations and ensures
affordability for consumers.
in the Underground Natural Gas Storage Market
Underground Natural Gas Storage market faces several challenges, which have
grown in complexity in recent years. These challenges can have a significant
impact on the operation, economics, and sustainability of storage facilities.
Here are some key challenges:
Complexity: The development and operation of Underground Natural Gas Storage facilities
are subject to complex and evolving regulatory frameworks. Regulations can vary
significantly by region, making it challenging for operators to navigate
compliance requirements. Regulatory changes can also affect the financial
viability of storage projects.
Concerns: Underground Natural Gas Storage operations can pose environmental
challenges, particularly in terms of methane emissions. Leaks and fugitive
emissions of methane, a potent greenhouse gas, can occur during the storage
process. Addressing these concerns is essential to align with environmental and
Key Market Trends
of Natural Gas Storage
gas is a versatile and clean-burning fossil fuel used for various purposes,
including electricity generation, heating, and as a feedstock for industries.
Unlike some other energy sources, natural gas production is often uneven and
can be subject to seasonal fluctuations, geopolitical disruptions, and
unexpected demand spikes. Underground Natural Gas Storage facilities act as a
buffer against these uncertainties, providing a consistent and reliable supply
of gas to meet demand fluctuations. The global Underground Natural Gas Storage market
has been steadily growing over the years, driven by factors such as increasing
natural gas consumption, expansion of gas infrastructure, and the need for
energy security. According to the International Energy Agency (IEA), in 2020,
global natural gas consumption stood at 4,047 billion cubic meters, and this
demand is expected to continue growing in the coming years.
of the prominent trends in the Underground Natural Gas Storage market is the
expansion of storage infrastructure. As demand for natural gas grows, new
storage facilities are being constructed, and existing ones are being upgraded
and expanded. This is particularly crucial in regions where natural gas plays a
significant role in energy supply, such as North America, Europe, and Asia. Advancements
in technology are transforming the Underground Natural Gas Storage sector.
Enhanced storage techniques like underground salt caverns, depleted oil and gas
reservoirs, and aquifer storage are becoming more common, allowing for higher
storage capacities and improved efficiency. Additionally, digitalization and
automation are enhancing monitoring and control systems, making storage
operations more efficient and cost-effective.
Towards Renewable Energy
global push towards cleaner energy sources is influencing the Underground
Natural Gas Storage market. Natural gas is seen as a bridge fuel that can help
transition from fossil fuels to renewable energy sources like wind and solar
power. This has led to increased interest in flexible gas storage solutions
that can quickly respond to fluctuations in renewable energy generation,
ensuring grid stability.
changes and environmental concerns are impacting the Underground Natural Gas Storage
market. Governments worldwide are imposing stricter emissions standards, which
are driving investments in technologies like carbon capture and storage (CCS)
to reduce the environmental footprint of gas storage facilities. Additionally,
regulatory changes may affect the location and construction of new storage
facilities. Geopolitical factors continue to influence the Underground Natural
Gas Storage market. Supply disruptions due to geopolitical tensions can lead to
increased demand for gas storage as countries seek to ensure a steady supply of
energy. For example, the European Union has been actively promoting gas storage
projects to enhance energy security in the face of political uncertainties.
are a number of advantages to using depleted reservoirs for gas storage. First,
they are typically located close to existing gas production and transmission infrastructure,
which reduces the need for new investment. Second, depleted reservoirs have
already been characterized and evaluated, which reduces the risk of developing
new storage facilities. Third, depleted reservoirs can be used to store large
volumes of gas at relatively high pressures, which makes them ideal for meeting
peak demand requirements. ncreasing
demand for natural gas: Natural gas is a clean and efficient fuel that is
becoming increasingly popular for use in power generation, heating, and transportation.
This growing demand is driving the need for more gas storage capacity.
for reliable and flexible storage options: Gas storage facilities help to
ensure a reliable and affordable supply of gas to consumers, even during
periods of high demand or supply disruptions. Depleted reservoirs are ideal for
this purpose, as they can store large volumes of gas at relatively high
pressures. Governments around the world are supporting the development of gas
storage facilities, as they recognize the importance of these facilities for
energy security and economic development.
Download Free Sample Report
The Asia pacific region has established
itself as the leader in the Global Underground Natural Gas Storage Market with
a significant revenue share in 2022. In 2022,
APAC had the biggest market share, and it is anticipated that during the
forecast period, APAC would continue to rule the storage of natural gas market.
The climate in the region is conducive to the extraction of natural gas, and
countries like China, India, and Indonesia have sizeable rural populations,
therefore the Asian region market is expected to increase significantly during
the course of a projection period. Additionally, rising natural gas prices are
anticipated to drive market growth in the years ahead future. Due to their
fast-growing end-use industries, India and China were two of the world's
biggest marketplaces. Many nations that produce less natural gas domestically
use gas storage facilities to meet demand. These nations consist of Korea,
Taiwan, Indonesia, & Malaysian. All of these elements are anticipated to
fuel market expansion in the region of Asia Pacific.
April 2019, Sempra Energy announced that it has completed the divestiture of
its US renewable business and non-utility Underground Natural Gas Storage assets
generating around USD 2.5 billion in cash.
October 2018, The executive members of Gazprom and VNG meet at 8th St.
Petersburg International Gas Forum to discuss gas imports and storage related
issues. The main attention was paid to joint efforts in the field of
underground gas storage including a joint project for the Katharina UGC
facility in Germany.
January 2018, Trafigura has signed a second deal with Singapore LNG Corp., for
storage and reload services of liquefied natural gas (LNG). Under the new deal,
Trafigura will have access to 160000m³ of LNG storage capacity for the next 24months.
Key Market Players
- Naftogaz of Ukraine
- Centrica Storage
- Uniper SE
- E.ON SE
- TransCanada Corporation
- Enbridge Inc.
- The Williams Companies, Inc.
- Southern Company
- Duke Energy
- Depleted reservoirs
- Salt caverns
- North America
- Asia Pacific
- South America
- Middle East & Africa
this report, the Global Underground Natural Gas Storage Market has been
segmented into the following categories, in addition to the industry trends
which have also been detailed below:
- Global Underground Natural Gas Storage
Market, By Type:
o Depleted reservoirs
o Salt caverns
- Global Underground Natural Gas Storage
Market, By Application:
- Global Underground Natural Gas Storage
Market, By Region:
o North America
§ United States
§ South Korea
§ United Kingdom
o South America
o Middle East & Africa
§ Saudi Arabia
§ South Africa
analysis of the major companies present in the Global Underground Natural Gas Storage
Underground Natural Gas Storage Market report with the given market data, Tech
Sci Research offers customizations according to a company's specific needs. The
following customization options are available for the report:
- Detailed analysis and profiling of
additional market players (up to five).
Natural Gas Storage Market is an upcoming report to be released soon. If you
wish an early delivery of this report or want to confirm the date of release,
please contact us at [email protected]