How Has the Underground Natural Gas Storage Market Evolved Historically and What is its Current Size?
The underground natural gas storage market has seen considerable growth due to a variety of factors.
• The market size of underground natural gas storage has seen significant growth in the past few years. It is expected to expand from $322.13 billion in 2024 to $339.93 billion in 2025, with a compound annual growth rate (CAGR) of 5.5%.
The growth witnessed during the historic period is due to factors such as the expansion of natural gas infrastructure, swift urbanization and population growth, the rise in trade of liquefied natural gas, along with increasing investments from the public and private sectors.
What is the Forecasted Market Size and CAGR for the Underground Natural Gas Storage Market?
The underground natural gas storage market is expected to maintain its strong growth trajectory in upcoming years.
• In the coming years, the underground natural gas storage market is anticipated to undergo significant enlargement, expanding to a value of $415.75 billion in 2029 with a compound annual growth rate (CAGR) of 5.2%.
This growth over the forecast period is expected due to several factors such as the surge in energy consumption, widening of renewable energy sources, escalation of liquefied natural gas (LNG) exports and imports, emergency readiness, and resilience. Major forward-looking trends include the refining of cavern construction methods, enhanced monitoring systems, broadening and improvement of storage facilities, amalgamation with renewable energy, growing focus on enhancing safety and mitigating environmental impact, and the incorporation of digital technologies.
What Key Factors and Trends Are Driving The Growth Underground Natural Gas Storage Market?
The ascent in natural gas production is anticipated to bolster the expansion of the underground natural gas storage market. Natural gas primarily consists of methane (CH4), along with trace amounts of other hydrocarbons such as ethane, propane, and butane. These are viewed as cleaner substitutes to other fossil fuels. The rising demand for natural gas can be attributed to various factors including the shift towards cleaner energy, industrial growth, and energy security. Underground storage helps manage the shifts in natural gas supply by storing surplus gas during periods of slack demand and extracting it during peak times, guaranteeing a stable supply and pricing. It also bolsters grid stability and the amalgamation of renewable energy by providing a backup during times of reduced renewable generation. For example, in September 2024, the US-based government agency, Energy Information Administration (EIA), revealed that the US dry natural gas production in 2023 amounted to 37.8 trillion cubic feet (Tcf) or 103.6 billion cubic feet per day (Bcf/d), marking a 4.3% surge from the 2022 level of 99.3 Bcf/d. As such, the burgeoning production of natural gas is set to stimulate the growth of the underground natural gas storage market.
What Are The Market Segments In The Underground Natural Gas Storage Market?
The underground natural gas storagemarket covered in this report is segmented –
1) By Type: Depleted Gas Reservoir, Salt Caverns, Aquifers, Other Types
2) By Product: Natural Gas, Hydrogen, Other Products
3) By Application: Residential, Commercial, Other Applications
Subsegments:
1) Depleted Gas Reservoir: Onshore Reservoirs, Offshore Reservoirs
2) Salt Caverns: Solution-Mined Caverns, Compacted Salt Caverns
3) Aquifers: Freshwater Aquifers, Brine Aquifers
4) Other Types: Geological Formations, Non-Conventional Storage
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What Trends Are Shaping The Underground Natural Gas Storage Market?
Prominent entities in the underground natural gas storage market are focusing on creating innovative solutions such as the hydrogen storage salt caverns initiative to bolster energy security and minimize carbon emissions. The initiative pivots on leveraging the unique characteristics of salt deposits for the safe and efficient storage of hydrogen. As an illustration, in March 2024, the European Consortium, a UK-based group made up of 17 partners and managed by Storengy, a UK-based natural gas storage firm, initiated the FrHyGe project. Sponsored by the European Union's Clean Hydrogen Partnership, this project with a budget of €43 million ($46.91 million), seeks to validate the utility of underground hydrogen storage in salt caverns on an industrial scale. The intent is to construct an industrial prototype in Manosque, France, and explore potential duplication in Harsefeld, Germany, with potential applicability across Europe. The project's goals encompass transforming natural gas or brine salt caverns into hydrogen storage facilities, proving the feasibility of injecting and extracting 100 metric tons of hydrogen in cycles varying from one hour to one week, scrutinizing market penetration and supply chains, and devising plans for replication at other European locations. Additionally, it intends to evaluate environmental impact, safety standards, and legislation ahead of implementing the GeoH2 (Manosque) and SaltHy (Harsefeld) projects.
Who Are the Key Players In The Underground Natural Gas Storage Market?
Major companies operating in the underground natural gas storage market are:
• Exxon Mobil Corporation
• Equinor ASA
• Uniper Energy Storage GmbH
• Gazprom
• Enbridge Inc.
• Southern Company
• ONEOK Inc.
• Targa Resources Corp.
• DTE Energy
• Sempra
• TC Energy Corporation
• The Williams Companies Inc.
• EnLink Midstream LLC
• NiSource Inc.
• Weatherford International
• Atmos Energy
• Naftogaz Group
• National Fuel Gas Company
• Hess Midstream LP
• NAFTA a. s.
• Texas Brine Company LLC
What Are The Regional Insights Into The Underground Natural Gas Storage Market?
Europe was the largest region in the underground natural gas market in 2024. The regions covered in the underground natural gas storage market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
