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Steel-Lined Storage Considered for Northeast

Steel-Lined Storage Considered for Northeast

The Northeast's hunger for gas storage could be answered by a new high-deliverability cavern technology being developed in Sweden. A consortium of U.S. and European companies are participating in a project to develop lined rock cavern (LRC) technology. LRC performance is said to be similar to that of salt cavern storage, but it can be located in areas where salt is not geologically present. The consortium is made up of New York State Electric & Gas Corp. (NYSEG) and the European companies Gaz de France and Sydkraft of Sweden.

Traditionally, gas peaking needs in the Northeast have been met using liquefied natural gas (LNG) or propane/air, both of which have limited flexibility. Because of its high injection and withdrawal capability, LRC storage can be completely cycled up to 12 times per year. Partial injection and withdrawal cycles can be provided daily or even hourly. And it may be possible to locate an LRC facility adjacent to a large end user, such as a local distribution company or power plant, to minimize pipeline transportation costs. However, LRC storage is expected to cost about twice as much to develop as similarly sized salt cavern storage, said Mike Kroft, NYSEG manger of commercial and industrial gas sales. The projected costs of LRC storage per dekatherm of daily deliverability is $8 per month.

Kroft said NYSEG and its partners are in the process of determining whether LRC is economic for the New England area. Mitigating the higher costs would be the ability for customers to turn back some of their upstream pipeline capacity. Also, multiple injections and withdrawals allow for better economics, Kroft said.

"We're looking at essentially the New England area, Connecticut, Massachusetts, and Maine. It's partly based on some siting type of studies that we are in the process of doing. And then there's also consideration of the market potential." Ideal would be a spot where there's a new power plant going up and also a gas LDC on which gas could be moved without using interstate lines.

An LRC project could complement Sable Island gas supply arriving in New England on the Maritimes and Northeast pipeline, Kroft said. "You've got to get enough capacity for whatever your peak need is. If some storage could be had to level that out, the two could complement each other, I believe."

Developed in Sweden, LRC technology involves lining specialty mined rock caverns with steel, enabling the storage of up to 3 Bcf of gas at pressures around 3,500 psig. The LRC concept has been engineered and tested in Grangesberg, Sweden. A determination project under construction in Skallen, Sweden, is to be placed in operation in early 2001 for full-scale testing and evaluation. Phase I of the U.S. project entails geologic and environmental review of potential sites, construction evaluation, and market analysis. If it is decided later this year to go forward with a U.S. project, the anticipated in-service date for an LRC cavern would be the winter of 2004-2005.

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