Prospects For A Strategic Stockpile In Natural Gas
Authors: Tek M.R. 
Published: December 2007

The need for a "Strategic Stockpile in Natural Gas" so vividly demonstrated by the harsh winter of 1976 is examined to identify 'prospects' as well as 'problems' the development of such a stockpile would entail. World wide distribution of "market limited supplies" as contrasted with "supply limited markets" suggests that the U.S. is the only country having the unique combination of three natural gas related resources. These are:World's largest market for natural gas;World's most elaborate existing pipeline network;World's largest number of existing gas reservoirs already connected to markets.

Having all the three resources, all developed, mostly paid up, and more and more unused, the paper, treats the inescapable conclusion that long range solution of present gas shortage may be possible through a long range development of a stockpile of gas imported from overseas.

The main source for the suggested stockpile is identified as natural gas transported to the U.S. following "Methane-Methanol-Methane" route using standard and surplus crude oil tankers.

Prospects and problems related to production overseas, methane-methanol reforming, transport in comparison to LNG, U.S. based plants and technology to gasify methanol into methane are reviewed in reasonable detail.

Other possible or probable sources for the strategic stockpile such as new gas from arctic or lower 48, LNG imports (presently underway), SNG from coal are also entertained as well as a review of pipeline, compression and underground storage capabilities.

Introduction

The United States once possessed the world's largest gas supply. This, along with the traditional climate of free enterprise led to the development of the world's largest market. The two, the supply and the market were connected with the world's most elaborate pipeline network. Due to the unique combination of these three resources a prolific growth industry resulted which consumed over 400 trillion cubic feet o natural gas between the years 1935 and 1975. However, the reserves leveled and appear to peak out. The discovery of oil and gas in the 'north slope' brought a brief sign of encouragement but the declines painfully resumed and appeared to persist thereafter. The harsh winter of 1976–77 helped focus the problems of the future into the view of the present. As our dependence on natural gas gets more and more critical and the hour grows late, our supply limited market must have access to market limited supplies around the world. Furthermore, the solution gas associated with the production of crude oil (our prime energy resource still for a number of years prime energy resource still for a number of years to come) also depends upon gas markets for proper consumption. In countries which do not practice conservation, the gas is flared into the atmosphere contributing both to pollution and waste. In countries where conservation is practiced through 'no flare' rule, scarcity of local markets for gas curtails the production of oil so much in need.

In the United States, we are fortunate to have a unique combination of not only a developed market and pipelines to supply and distribute the gas to it, but, at the same time, an environment, safe and ecological to put the gas in storage.

SO WHY NOT BUILD A STRATEGIC STOCKPILE IN METHANE?

We have over 32,000 gas wells, some 6,000 plus existing gas or storage reservoirs, over 70,000 linear miles of gas gathering lines 260,000 miles of long distance pipelines and 660,000 miles gas distribution networks. We have over 45 million meters. Over 60 percent of our homes are heated by natural gas. These facilities shown schematically in Figure 1 are all operational, mostly paid and more and more unused. Why not use these resources more effectively? If we could pressure up and restock our existing reservoirs to conditions which prevailed before our overall economic well-being prevailed before our overall economic well-being would be vastly improved.

Where could we get the gas from? We could get it from far away overseas resources where market limited supply exists: Saudi Arabia, Iran, West Irian, Australia, even Siberia, other areas.