Natural gas storage policy
The owner of the natural gas storage (herein referred to as the “storage owner” or “transporter”) is not entitled to sell or loan the natural gas but is obligated to store the natural gas for the customer (shipper). The storage owner earns a service fee for the shipper’s injection, storage, and withdrawal of the natural gas.
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6 FAQs about [Natural gas storage policy]
Where is natural gas stored?
Natural gas is stored in large volumes in underground facilities and in smaller volumes in tanks above or below ground. The United States uses three main types of underground natural gas storage facilities: Depleted natural gas or oil fields —Most natural gas storage is in depleted natural gas or oil fields that are close to consuming areas.
Are natural gas storage facilities state regulated?
If a storage facility serves interstate commerce, it is subject to the jurisdiction of the Federal Energy Regulatory Commission (FERC); otherwise, it is state-regulated. Owners/operators of storage facilities are not necessarily the owners of the natural gas held in storage.
How does natural gas storage work?
Natural gas storage during periods of low demand helps to ensure that enough natural gas is available during periods of high demand. Natural gas is stored in large volumes in underground facilities and in smaller volumes in tanks above or below ground. The United States uses three main types of underground natural gas storage facilities:
What is a natural gas storage facility?
Natural gas storage facilities are an integral part of the U.S. natural gas infrastructure. Most storage facilities function to modulate the naturally occurring seasonality in demand of natural gas – historically providing a demand sink in the summer when natural gas demand is low and a supply source in the winter when demand is high.
Why is underground storage of natural gas important?
The underground storage of natural gas has historically been critical in assuring that overall demands and use of specific requirements of natural gas customers are met.
Is natural gas storage capacity inadequate?
Over the same period, gas storage capacity has increased only 1.4 percent. While construction of storage capacity has lagged behind the demand for natural gas, we have seen record levels of price volatility. This suggests that current storage capacity is inadequate.