A Review of Michigan's Underground Hydrocarbon Storage

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A Review of Michigan's Underground Hydrocarbon Storage A REVIEW OF MICHIGAN'S UNDERGROUND HYDROCARBON STORAGE SPE MWGS SPRING WORKSHOP 4 MARCH 2015 Timothy J. Brock, PE Brock Engineering, LLC PRESENTATION OVERVIEW • Why does Michigan need underground storage? • Where are the storage facilities? • What is stored and how much? • How is it stored? • What are the formations that are used? • How is the working gas distributed by formation? • What is the percentage of base gas to total storage? • How many wells are involved? • How does the base gas requirement differ between zones? • How much area do the fields require/BCF? • How old are the facilities? NOTE: ALL INFORMATION IN THIS PRESENTATION HAS BEEN OBTAINED FROM PUBLIC SOURCES – USEIA, MDEQ AND MPSC 2 MICHIGAN ENERGY CONSUMPTION BY TYPE 3 MICHIGAN NATURAL GAS CONSUMPTION AND PRODUCTION, 2001-2013* 1,000,000 900,000 800,000 700,000 600,000 500,000 Gas Consumption Gas Production 400,000 300,000 Annual Gas Volumes, MMCF Gas Annual 200,000 100,000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 * Per USEIA 4 MICHIGAN’S UNDERGROUND HYDROCARBON STORAGE LOCATIONS 5 MICHIGAN STRATIGRAPHIC COLUMN SHOWING STORAGE FORMATIONS* Stray Sandstone Reed City Salina Salts, Carbonates, Niagaran and Reef Trenton * Michigan DEQ Office of Oil, Gas and Minerals 6 WHAT IS STORED UNDERGROUND IN MICHIGAN? • Natural Gas • Natural Gas Liquids • Propane • i-Butane • n-Butane • Mixed Butanes • Mixed NGL’s 7 HOW MUCH IS STORED? • Natural Gas* • Working Gas: 688 BCF • Base Gas: 447 BCF • Total Storage Gas: 1,135 BCF • NGL** • Total Cavern Capacity: 537 MMGAL • Number of Facilities: 5 • Number of Caverns: 40 * Per Michigan Public Service Commission ** Per Michigan DEQ Office of Oil, Gas and Minerals, not necessarily storage volume 8 HOW IS IT STORED? • Natural gas • Depleted reservoirs – former producing reservoirs that have been converted to storage • Salt caverns – former solution mining operations for salt production and dedicated caverns constructed for gas storage • NGL’s • Salt Caverns – former solution mining operations for salt production and dedicated caverns constructed for NGL storage 9 WHAT FORMATIONS ARE USED? • Natural Gas • Michigan Stray Sandstone (Mississippian), 14 Fields, 11 Active • Reed City Dolomite (Devonian), 1 Active Field • Salina Salts (Silurian), 2 Active Facilities, 9 Caverns • Salina Carbonates (Silurian), 2 Active Fields • Regional Niagaran (Silurian), 2 Fields, 1 Active • Niagaran Reefs (Silurian), 39 Fields, 38 Active • Trenton (Ordovician), 1 Inactive Field • NGL’s • Salina Salts (Silurian), 5 Active Facilities, 40 ActiveCaverns 10 NATURAL GAS STORAGE WORKING GAS BY FORMATION, BCF* 2.17 9 30.9 33 22 146.9 A-1 Carbonate B Salt Michigan Stray Niagaran Reef Reed City Regional Niagaran Trenton 466.5 * Per Michigan Public Service Commission 11 NUMBER OF WELLS INVOLVED* Active I/W Plugged I/W Active OBS Plugged OBS Gas Storage 2322 708 465 152 NGL Storage401800 * Per Michigan DEQ Office of Oil, Gas and Minerals 12 BASE GAS % OF TOTAL GAS STORAGE CAPACITY* 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Base GasPercent of Total Storage * Per Michigan Public Service Commission 13 GAS STORAGE ACRES/BCF WORKING GAS* 10000 1000 100 10 Acres/BCF of Working Gas 1 A1 B Salt Michigan Michigan Niagaran Niagaran Reed City Regional Regional Trenton - Carbonate Stray - Stray - Reef Reef - Prop Niagaran Niagaran - Abdn Active Abdn Abdn * Per Michigan Public Service Commission 14 STORAGE RESERVOIRS AVERAGE AGE, YEARS 70 60 50 40 30 20 Average Age in Years in Age Average 10 0 * Per Michigan Public Service Commission 15 FUTURE DEVELOPMENT • Most likely additional natural gas storage will occur in depleted Niagaran Reefs • High deliverability • Lower base gas requirement • Less areal extent required • Large number of potential targets • Most likely additional NGL storage will occur in and around existing facilities, due to infrastructure. 16 QUESTIONS? • Thank you for the opportunity to share this information today. • Brock Engineering, LLC is a professional engineering consulting company. Our mission is to provide top quality engineering solutions to our clients’ needs in a timely and in a cost effective manner. 17.
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