Natural Gas Storage Consultancy and Training
Natural gas demand and supply rarely match instantaneously and therefore gas storage facilities play a crucial role in modulating supply to meet demand. However, gas storage technology and operations can be costly and challenging due in particular to the relatively low energy content of natural gas, leading to a reliance on geological storage in depleted gas fields, aquifers and salt caverns. Other technologies include peak-shaving and terminal LNG storage, compressed natural gas, use of mines and lined caverns, and linepack. In liberalised, trading markets gas storage plays an additional role as a trading tool, multi-cycling to optimise time arbitrage.
MJMEnergy has advised on a range of gas storage projects covering the full range of gas storage technologies. Our staff and associates combine technical, commercial, regulatory and operational experience of gas storage, enabling us to provide a strong gas storage consultancy service.
The following titles are examples of some of the energy consultancy projects that we have carried out in this area of expertise. (Clicking the title will provide more information.)
- North-West Europe Gas Storage Study
- UK Gas Storage Feasibility Study
- European Storage Investment Opportunities
- UK Significant Code Review: Gas Supply Security
North-West Europe Gas Storage Study
A major investment bank approached MJMEnergy with a requirement to understand future market dynamics for North West European storage in a very short timescale as part of a proposed storage acquisition. Due to our existing in-house resource and storage expertise we were able to respond rapidly, and complete the project within four days of the initial request.
This project included two elements: a spreadsheet listing gas storage facilities in NW Europe and a report analysing future market dynamics for the storage market. The spreadsheet listed over 100 proposed or operational storage facilities in Germany, the Netherlands and the UK, and analysed each in terms of operational characteristics and a range of other commercial factors. The report explained the context for gas storage valuation in NW Europe, including long-term and short-term gas pricing and the value of flexibility, and then considered potential impacts in terms of Knowns, Known Unknowns, and Unknown Unknowns.
The report was delivered on time and completed with a teleconference to summarise the findings and explore further questions and issues.close
UK Gas Storage Feasibility Study
The purpose of this feasibility study was to provide estimates of capex, opex and potential income that would result from converting a disused mine into a gas storage facility for operation in the UK gas market. This project involved understanding how the technical and commercial aspects of gas storage in the UK linked with a detailed geological understanding of the potential asset itself. Therefore we developed a bespoke team that consisted of experts in the technical and commercial aspects of gas storage, gas compression and geology, working with WYG.
In order to establish both the technical and commercial feasibility of the project we developed two work areas. The Technical Team undertook a review of the disused mine as a potential gas storage facility with detailed examination in order to establish its potential technical characteristics. In parallel the Commercial Team, following an analysis of the gas storage market in the UK, developed a gas storage valuation model. Then using the characteristics provided by the technical team, established a potential NPV for the project based on the intrinsic and extrinsic value of the asset. Given the aspirations of the client to ultimately sell the asset the main deliverable was a high quality feasibility study for review by potential purchasers. The final report therefore clearly set out the options open to potential purchasers for using the disused mine as a gas storage facility with associated costs and potential incomes.close
European Storage Investment Opportunities
Working in conjunction with South Court, MJMEnergy provided a ranked project database for an investment firm wishing to enter the European gas storage market. The database included over 50 European gas storage facilities, with rankings reflecting their potential value in changing markets, and recommendations for where investment was l ikely to achieve the greatest return.close
UK Significant Code Review: Gas Supply Security
Ofgem as part of its Gas security of supply review, commissioned MJMEnergy/Redpoint to identify and analyse the possible risks to GB gas supply security, to inform the regulator’s decisions as to whether to support strategic storage or other interventions in the gas market.
The report was based on a wide-ranging literature review and a series of interviews with key stakeholders and academics.
MJMEnergy produced a report that provided an overview of the issue of security of gas supply as it affected the GB market, including an analysis of what was meant by security of supply, current and future challenges to security of supply and a description of the GB gas market from a security of supply perspective.
We also analysed potential supplies of gas (delivered as LNG and pipeline gas respectively) and associated risks to GB supply security and provided key conclusions regarding risks to security of supply for the GB gas market.
MJMEnergy provided gas specialist support to Redpoint’s modelling of the impact of various potential security of supply interventions.close
Training and Capacity Building:
The following are examples of some of the energy training and capacity building we have carried out that is relevant to this area of expertise. (Clicking the title will provide more information.)
- Gas Storage Course
- Why store gas?
- Types of gas storage facilities
- How storage is sold
- Storage economics
- Building gas storage
- A case study of a current storage project
- The future of gas storage
Gas Storage Course
We will explain the need to store gas and look at the different types of storage facilities available. You will gain an understanding of how to buy storage capacity, trade gas using storage, and the whole economics of gas storage. You will look at how to build storage, examine a case study and explore the future of storage.
The course covers:
The following titles are examples of energy reports that we have written, published or sell and are included to complement this section. Feel free to click on the titles for more information.
- Underground Gas Storage and LNG Storage Market in the World
Underground Gas Storage and LNG Storage Market in the World
"The Underground Gas Storage & LNG Storage Market in the World 2015-2035" builds on the CEDIGAZ Underground Gas Storage Database, the only worldwide Underground Gas Storage database to be updated every year, and on the CEDIGAZ LNG Service, a comprehensive service dedicated to the LNG market.
This report is divided into three parts:
Part one: - analyses current and future trends in the storage market to 2035 (UGS and LNG storage).
Part two: - is specifically dedicated to the EU UGS market. The analysis reviews key economic and regulatory factors that are reshaping the EU market.
Part three: - includes in-depth analyses for 49 countries worldwide.close
Key staff and associates:
- Mike Madden
- Nick White
- David Long
- Jeremy Bending
- Chris Le Fevre
- David Haynes