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Ensuring Safe and Reliable Underground Natural Gas Storage

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Ensuring Safe and Reliable Underground Natural Gas Storage Ensuring Safe and Reliable Underground Natural Gas Storage Final Report of the Interagency Task Force on Natural Gas Storage Safety October 2016 About the Cover: Relief well at the SoCalGas Aliso Canyon Gas Storage Facility well Standard Sesnon 25 (SS-25) (February 2016) Message from the Secretary of Energy Earlier this year, Congress and the Administration worked together to establish a Federal Task Force to analyze California’s Aliso Canyon natural gas leak and make recommendations on how to reduce the likelihood of future leaks from underground natural gas storage facilities across the country. While these incidents are rare, the leak at Aliso Canyon is a reminder that failures at aging natural gas storage facilities can have damaging effects on communities, the environment, and the reliability of our energy supplies. At the same time, the Nation’s 400+ natural gas storage facilities provide essential services. They deliver gas at times of high demand to heat our homes and businesses, to power American industry, and increasingly, to provide fuel for electricity generation. The Task Force identified three principal research areas associated with natural gas storage facilities: minimizing the risk of well failures; reducing health and environmental impacts of major leak incidents; and understanding energy reliability implications. Across these areas, the Task Force has made more than 40 recommendations that identify the need for additional actions at our Nation’s natural gas storage facilities to ensure their long-term safety and reliable operation. Key recommendations of the Task Force include: • Gas storage operators should begin a rigorous evaluation program to baseline the status of their wells, establish risk management planning and, in most cases, phase-out old wells with single-point-of- failure designs. • Advance preparation for possible natural gas leaks and coordinated emergency response in the case of a leak can help manage and mitigate potential health and environmental impacts of leaks when they do occur. • Power system planners and operators need to better understand the risks that potential gas storage disruptions create for the electric system. No community should have to go through something like the Aliso Canyon leak again. The recommendations in this report outline the steps we can take to prevent such an incident in the future. Now, it is up to industry to implement these recommendations in a timely fashion, while State and Federal officials develop regulations that enhance the safety of underground storage facilities in the United States. Ernest J. Moniz Secretary of Energy i Message from Task Force Co-Chairs In April, as a part of the Administration’s ongoing commitment to support State and industry efforts to ensure the safe storage of natural gas, and with the support of Congress, the Department of Energy (DOE) and the Department of Transportation’s (DOT) Pipeline and Hazardous Materials Safety Administration (PHMSA) announced the formation of an Interagency Task Force on Underground Natural Gas Storage Safety. Two months earlier, along with the Secretary of Energy, we visited the Aliso Canyon site to review efforts to control the leak and to learn from experts and local officials about the impacts of the leak on the environment and community. The Task Force includes premier scientists, engineers and technical experts from across the DOE complex, including five National Labs, DOT, the Environmental Protection Agency (EPA), the Department of Health and Human Services (HHS), the Department of Commerce (DOC), the Department of the Interior (DOI), the Federal Energy Regulatory Commission (FERC), and the Executive Office of the President. As a Task Force, we have held three national-level workshops and met with community members, industry representatives, environmental organizations, and State officials. The Task Force established three working groups for research and analysis: (1) the physical integrity of wells at gas storage facilities, (2) the reliability of natural gas supplies from gas storage facilities, and (3) the public health and environmental impacts associated with the Aliso Canyon leak. The “Well Integrity” working group was led by DOE’s Office of Fossil Energy, with important contributions from four DOE National Labs—the National Energy Technology Laboratory, Lawrence Berkeley National Laboratory, Lawrence Livermore National Laboratory, Sandia National Laboratories, and PHMSA. The “Reliability” working group was led by the Department of Energy’s Office of Electricity Delivery and Energy Reliability with important contributions by DOE’s Argonne National Laboratory, DOE’s Energy Information Administration, and FERC. The “Health and Environment” working group was led by the EPA and HHS’s Centers for Disease Control and Prevention. DOC’s National Oceanographic and Atmospheric Administration and PHMSA also contributed. This final report is a synthesis of the three working group reports, which will be made available as separate technical appendices to the report. PHMSA plans to initiate regulatory actions to help ensure the safety of natural gas storage facilities across the country, beginning with an Interim Final Rule due out by the end of this year. Moving forward, PHMSA will consider the recommendations of this Task Force in developing future regulation and safety standards as required by the PIPES Act of 2016 (P.L. 114-183). ii Ensuring Safe and Reliable Underground Natural Gas Storage Natural gas provides heat to millions of American homes and is expected to provide a third of our Nation’s total electric power generation this year. As co-chairs of this Task Force, we have made it a priority to support States, industry and the American public to ensure that our infrastructure is safe. The Task Force’s efforts are an important step forward as we continue to work toward protecting public health and safety and making progress in reducing greenhouse gas emissions. We offer our recognition and gratitude to all those whose hard work and thoughtful analysis are assembled here. Franklin Orr Under Secretary for Science and Energy Marie Therese Dominguez Administrator, Pipeline and Hazardous Materials Safety Administration iii Contents Message from the Secretary of Energy ......................................................................................................... i Message from Task Force Co-Chairs .......................................................................................................... ii Executive Summary ..................................................................................................................................... 1 Legislative Requirement .............................................................................................................................. 4 Chapter 1. Gas Storage Primer .................................................................................................................... 5 Natural Gas Storage Basics ...................................................................................................................................5 Why is natural gas stored underground? .....................................................................................................5 How is natural gas stored? .............................................................................................................................5 Where is natural gas being stored? ...............................................................................................................5 Why do we care about natural gas leaks from UGS facilities? ..................................................................6 Underground Storage Types .........................................................................................................................7 Gas Storage Wells in the United States: Data and Analysis .............................................................................8 Analysis of Gas Storage Well Completions .................................................................................................8 Natural Gas Storage and Population Centers .......................................................................................... 10 Regulation of Natural Gas Storage Facilities ................................................................................................... 11 Overview of Jurisdiction to Regulate Natural Gas Storage Facilities .................................................... 11 Interstate versus Intrastate Regulation...................................................................................................... 11 Past Challenges to State Jurisdiction to Regulate Natural Gas Storage Facilities ................................ 11 Industry Develops Consensus-Based Recommended Practices with State and Federal Authorities 12 Congress Mandates Minimum Federal Standards .................................................................................. 12 State-Level Regulations by Reservoir Type .............................................................................................. 12 State Regulations Related to Natural Gas Storage Wellbore Integrity .................................................. 14 Notable Gas Storage Failures ...................................................................................................................... 16 Chapter 2. The Aliso Canyon Incident ....................................................................................................
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