The cost of constructing salt caverns for gas or hydrogen storage is generally higher in initial investment compared to depleted gas reservoirs, but salt caverns offer operational advantages that can lead to lower per unit storage costs.
Salt Cavern Construction Costs:
- Salt caverns are created by solution mining, injecting water to dissolve underground salt formations and form a cavity. This process involves significant upfront investment, making salt caverns the highest initial cost option among underground storage types.
- For hydrogen storage specifically, the capital cost of building a salt cavern facility remains fairly constant despite changes in storage pressure, with detailed analyses estimating capital costs that contribute significantly to the overall storage cost. For example, levelized costs for hydrogen storage in salt caverns can be around $0.21/kg H2, with capital costs as a major component.
- Salt cavern construction also requires some costs related to brine disposal and mechanical integrity testing, adding to the overall capital expenses.
Depleted Gas Reservoir Construction Costs:
- Depleted gas reservoirs do not require excavation or creation of new cavities, as the storage space is the existing reservoir left after gas production.
- Investment is primarily in well modifications, compressor stations, and surface facilities, with relatively lower initial excavation or cavern formation costs compared to salt caverns.
- However, depleted reservoirs generally need a larger volume of cushion gas (unrecoverable gas left in storage to maintain pressure), which increases operational and gas inventory costs.
Comparison Summary:
| Aspect | Salt Caverns | Depleted Gas Reservoirs |
|---|---|---|
| Initial Construction Cost | High (due to solution mining and cavern creation) | Lower (repurposing existing formations, no excavation) |
| Cushion Gas Requirement | Low (~33% of storage capacity) | Higher (more cushion gas needed) |
| Operational Costs | Lower per unit due to high deliverability | Higher due to larger cushion gas and slower injection/withdrawal rates |
| Storage Capacity | Smaller volume | Larger volume |
| Use Case | Peak load demand due to high deliverability | Base load supply due to large capacity |
In conclusion, salt cavern construction entails higher upfront capital costs than depleted gas reservoirs, but offers operational advantages like lower cushion gas requirements and higher deliverability rates, which reduce per unit storage costs and make salt caverns preferred for peak load storage. Depleted reservoirs are less expensive to develop initially but involve higher ongoing costs related to cushion gas and slower operational flexibility.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-the-cost-of-constructing-salt-caverns-compare-to-depleted-gas-reservoirs/
