Session 4 -GAS STORAGE Legal and Commercial Issues.pptx

The highlight of this presentation covering : definition of gas storage, type of gas storage, functions, service contracts, type of gas storage services, its importance, and the key elements

1. Gas Storage Legal and Commercial Issues [For Non Engineer] Sampe L. Purba

2. Gas Storage Facilities – definition Gas Storage Facilities are infrastructures used to store natural gas for later use. Crucial in balancing supply and demand, ensuring that natural gas is available during peak consumption periods, such as in winter, or when there are disruptions in supply. The stored gas can also help stabilize prices by mitigating the effects of market fluctuations. Agu-24 2 Sampe Purba - Gas Storage

3. Type of Gas Storage Facilities Underground Storage Facilities Depleted Gas Reservoir infrastructure and geological condition relatively known Aquifers  Water-bearing formation, Need more infrastructure Salt Caverns injecting water to underground salt formation. Good for short term supply management Above ground Storage Facilities LNG storage, natural gas cooled to -162C, reducing volume 600 times Agu-24 3 Sampe Purba - Gas Storage

4. Function of Gas Storage Facilities Supply Securities Price Stabilization Operational Flexibility Seasonal Demand Management Agu-24 4 Sampe Purba - Gas Storage

5. Gas Storage Service Contracts Agreements between a gas storage facility operator and customer [gas producer, utility company, or trader] Functioning to managing the logistics of storing, withdrawing, and injecting natural gas Agu-24 Sampe Purba - Gas Storage 5

6. Type of Gas Storage Services Baseload Storage  constant supply, regular demand Peaking Storage  to meet sudden spikes in demand Balancing Storage  managing short-term fluctuation in supply and demand Agu-24 6 Sampe Purba - Gas Storage

7. Importance of Gas Storage Services Contract Supply Reliability  handling disruptions Market participation  gas traders and supplier portfolio management Risk management  mitigate risk against supply shortages, price volatility and operational issues Agu-24 7 Sampe Purba - Gas Storage

8. Key Elements of Gas Storage Service Contracts Contract types [Firm, Interruptible, Seasonal] Capacity and deliverability [Storage capacity, injection and withdrawal rate] Fees and Charges [capacity charges, injection/ withdrawal charges, commodity charges] Contract duration Balancing and Penalties [imbalance charges, make-up rights] Operational Flexibility Force majeure and Liability Agu-24 8 Sampe Purba - Gas Storage

9. References Peter Roberts https://www.amazon.com/Gas-LNG-Sales-Transportation-Agreements/dp/041411129X The Law and Business of LNG, Paul Griffin, 2012 Energy Economics, Concepts, Issues, Markets and Governance, S.C Bhattaacharyya , 2011 Sampe Purba – www.slideshare.com Agu-24 9 Sampe Purba - Gas Storage

10. Agu-24 10 Sampe Purba - Gas Storage