The volume of gas in underground storage is the total of the regularly injected and withdrawn working gas, injected base (or cushion) gas, and native gas. The distinction between working gas vs. base gas, however, is not an absolute, one-answer value.
Numerous factors can influence the classification of working and base gas. Geology of the field, engineering of surface facilities, and market demand and storage contracts are interwoven in determining how much working gas and how much base gas is required. Several of these factors can change over time.
What's what
First, here are some simple definitions of working gas and base gas.
Working gas is the volume of gas that can be injected and withdrawn from storage. Base gas is the minimum volume of gas that must be present in storage at all times to maintain a storage field's pressure. This base gas is required to ensure the storage field will be able to provide the desired deliverability, especially as pressures fall toward the end of the withdrawal cycle.
If you change the minimum operating pressure or the contractual deliverability obligations for the last day of withdrawal, you change the both the base and working gas quantities.
Of course, storage reservoir characteristics are key in determining the classification. Such technical considerations as reservoir depth and pressures, spillpoint, and water encroachment all limit how much gas can be injected and withdrawn (working gas) and what volume of gas must remain in the reservoir (base gas).
In addition to the technical considerations, the volume of gas classified as base gas is also influenced by such surface facilities as wells and compression equipment, contractual obligations, and regulatory descriptions.
Two comparable fields could provide similar deliverability throughout the withdrawal season even if one field operates with a smaller volume of base gas, if that operator makes an investment in additional compression and dehydration. Other factors such as additional horizontal and vertical wells can change base and working gas ratios.
Storage contracts are also a key to determining the designation of working and base gas. Firm storage service requires that the volume contracted for be available for delivery even on the last day of the withdrawal season. Typical storage contracts have a stair-step deliverability obligation with volumes decreasing throughout the withdrawal season. A specific amount of base gas is required to meet the last day of deliverability.
For any particular storage reservoir, base gas requirements may vary 15-75% of its capacity, typically representing one-third to one-half the investment of developing a new storage facility. Given this fact, minimizing base gas and maximizing working gas is a key source of value in storage development and operation.
What's where
The playing field is not exactly level, however.
Storage facilities, usually depleted reservoirs or aquifers constructed in the 1940s or 1950s, operate with very low-priced base gas, often on the order of 10¢/Mcf. Inexpensive base gas already injected into these storage fields provides low-cost storage service and greatly enhances the value of the fields.
In many cases, the percentage of total gas designated as base gas at these older facilities is higher than the base-gas percentages at more recent developments. The high percentage of historically low-cost base gas offsets the expense of adding compression or wellbore enhancements to provide similar levels of deliverability with less base gas.
Recently developed storage facilities are burdened with higher base-gas costs due to high market prices, but the volume of base gas is optimized at lower levels through the use of such advanced technologies as horizontal wellbores and contracts with deliverability profiles that more closely mirror market demand.
Gas is sometimes reclassified as either working or base gas, depending on changes in the storage reservoir, upgrades to facilities, and variations in market demand. It is believed that many existing facilities, particularly in the US Midwest and East, could be re-engineered to provide greater deliverability with less base gas.
Regulatory and commercial issues regarding the rights to low-cost base gas and incremental costs and benefits of technical optimization have hampered this effort.
Even innovative service offerings of existing capacity are limited by regulatory considerations and the existing customer's reluctance to support change.
The natural gas market suffers from inefficient constraints placed on the existing infrastructure.
