csg underground storage announcement, page-10

I thought I would add a bit more background to this gas storage idea. Hope readers find it of interest. Basically the development costs of the site, excluding any site specific issues are:

1. quality and variability of the geologic structure
2. the amount of compressive horsepower required
3. type of surface facilities required
4. the proximity of pipeline infrastructure
5. Regulatory, planning and environmental issues.

So using Silver Springs maximum capacity of 90BCF or 95PJ, of which half is base or pressure gas, and using the US figures of $6m per PJ of working gas capacity then we get a total possible project cost of $270m USD or $350m AUD. This development cost assumes the purchase of the base gas, which would be capitalised and recovered over the life of the project. Obviously up front project costs could be reduced by more innovative methods surrounding base gas supply.

Anyway I have also included some information on a new project near Bakersfield in California, a state with over 320PJ of storage in existence or under development, to give readers some falvour as to equipment required.

This field will have 23PJ of working gas but only 10PJ of base gas on a 4 times yearly cycle with a withdrawal capacity of 1Pj per day and an injection rate of .8PJ per day.

It will need 26 new injection wells on 5 pad sites.
9 existings wells will be converted to observation and testing wells
5 water disposal wells
42,000 hp compressor station consisting of 6 x 7000hp electric recripocating compressors
2 x 20inch dia gas injection/ withdrawal pipelines
21 mile long, 36 inch bidirectional gas storage pipeline
1 x 50MW of power supplied by a 3rd party

Sorry but dont have any figures on cost to construct or operational figures as a highly competitive and figures are not disclosed by the field applicants. However their indicative charges for non binding supply are as follows:

Reservation charge in USD $.3025 per "Maximum Storage Quantity",MSQ, per month in MMBtu
Injection Charge of $.0127 per MMBTU
Withdrawal Charge of $.0177 per MMBtu
Fuel Reimbursement charge of 2.44% of nominated volumes.

Max daily withdrawal is 1/30th of MSQ
Max daily injection is 1/60th of MSQ

Somebody else might want to play with the numbers in Excel and come up with a possible model for Silver Springs?

Cheers


Ross