April 11, 2018 / 11:05 PM / a year ago

FACTBOX-China's underground natural gas storage facilities

    BEIJING, April 12 (Reuters) - China, the world's No.3 gas consumer, is
speeding up expanding its much-needed underground gas storage (UGS) facilities
for the clean-burning fuel to cope with supply crunches in winter months when
demand surges to heat homes.            
     Gas supplied from underground storages hit a record 7.4 billion cubic
metres (bcm) during last winter's severe supply squeeze, compared to an average
of 4-6 bcm during the previous few winters. 
     China now operates 25 facilities with total designed working capacity of
18.9 bcm and working volume of 11.7 bcm, more than double capacity in 2015.
Maximum daily extraction rate tops 90 million cubic metres. 
     At 11.7 bcm, it makes up less than 5 percent of the total gas consumed,
well below the 20 percent for top consuming nations such as the United States
and Russia. 
     As a comparison, one single storage run by Russian gas giant Gazprom has
working capacity of 170 million cubic metres per day, larger than China's total
combined facilities. 
    PetroChina, the country's dominant gas producer, built 23 of the 25
facilities, with the remaining two built by Sinopec, the No.2 oil and gas
    - First facility, Dazhangtuo at Dagang of northern China's Hebei province,
was put to use in late 2000, primarily to cope with supply disruption of the
Shanxi-Beijing trunk gas line connecting gasfields in the Ordos basin with the
capital Beijing. 
    - Most of the facilities were built using tapped gas wells or producing
wells. Only a few use salt caverns which require higher building costs and
longer construction periods. Building of one salt-cavern project, Jintan in east
China's Jiangsu province, is still in progress after construction began in 2005.
    - Costs for building 10 bcm storages out of gas wells vary between 20-60
billion yuan ($3.2-$9.5 billion), depending on geological conditions. From site
selection to construction, it takes between three to eight years to complete. 
    - Chinese gas wells for storages are typically deeper underground than in
other countries, between 2,500 to 5,000 metres, with many located in the densely
populated southwestern region.  
    - Near-term China will focus on boosting efficiency and utilization at
current sites and serve mainly for peak seasonal demand, while planning
strategic bases in a longer run.
    - Storages in the United States and Europe are mostly independently run in a
fully liberalised market that reflects price spreads between low and high
seasons that give storage investors good returns. China's market is
state-controlled, with fixed premiums for winter pricing.     
      Below is a list of current storage sites sourced from PetroChina's UGS
    (capacity in billion cubic metres)  
 Gas storage                     Location           Working          Start up
 Banqiao Gas  Dazhangtuo      Dagang, Tianjin          3             Dec 2000
              Ban 876                                                            
   Jintan                   Zhixi Town, Jintan,       1.72           May 2007
    (salt                        Jiangsu                         
 Jing 58 Gas  Jing58          Yongding Hefan          0.75           Aug 2010
   Storage                  District, Yongqing                   
    Group                     Town, Langfang,                    
 Suqiao Gas   Su1               Jinjiabao,            2.33           Jun 2013
   Storage                     Wangzhuangzi                      
    Group                    Village, Bazhou,                    
              Su4            North Yanggezhuang Village, Xinan           
                                    Town, Bazhou, Hebei          
              Su20          Renzhuangzi Village, Bazhou, Hebei           
              Su49          Yongqing County, Langfang, Hebei             
  Hutub Gas                 East Hutubi County,      4.51            Jun 2013
   Storage                   Changji, Xinjiang                   
 Xiangguosi                   Sansheng Town,         2.28            Jun 2013
 Gas Storage                Yubei District and                   
                             Beibei District,                    
  Liuzhuang                   North Chenqiao          0.25          Nov. 2011
 Gas Storage                Town, Jinhu County,                  
                              Huaian, Jiangsu                    
    Wen96                   Wenliu Town, Puyang       0.3           Nov. 2013
  (Sinopec)                   County, Puyang,                    
 Bannan Gas                  Dagang District,         0.43          Jun. 2014
   Storage                     Tianjin                           
 Shuang6 Gas                Panjin, Liaoning          1.6           Apr. 2014
  Shaan224                   Jingbian County,         0.5           Nov. 2014
 Gas Storage                  Yulin, Shaanxi                     

($1 = 6.3261 Chinese yuan renminbi)

 (Reporting by Chen Aizhu. Editing by Lincoln Feast.)
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