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In October 2015, due to a mechanical failure, a leak began at a natural gas storage injection well at the Aliso Canyon Underground Storage Facility owned and operated by the Southern California Gas Company (SoCalGas). Many residents of the Porter Ranch Community, which lies about a mile away from the affected well, were relocated while SoCalGas Company worked to stop and repair the leak. On February 18, 2016, state officials announced that the leak was permanently plugged.
SoCalGas is part of the investor owned utility Sempra Energy and is not a member of CIPA. Instead, they are a utility regulated by the California Public Utilities Commission and provide natural gas directly to end users and power generators. CIPA represents independent oil producers, which are companies that extract oil which is then sold to refineries that convert the raw crude into gasoline, diesel, jet fuel, and other refined products.
Many have asked how a gas storage facility differs from an oil and natural gas production facility. This paper explains some of the differences.
Aliso Canyon is an historic oil and natural gas field with oil production dating back to the 1930s. When oil production wells began to run dry in the 1970s, SoCalGas purchased a portion of the field to convert it to a natural gas storage facility. The field was suitable for storage since the geological formations that once held oil were now depleted and the impermeable layers of rock, known as the “cap rock”, which once trapped oil were now available for storing injected natural gas.
To help keep prices low, protect against price spikes, and meet higher customer demand for natural gas in the winter, SoCalGas buys natural gas throughout the year from as far away as Canada and stores it at their storage facilities like Aliso Canyon. Natural gas from the storage facility also helps supply the energy needed for electricity generation.
Unlike storage facilities which inject and draw out natural gas imported from other areas via pipelines, production wells extract oil and natural gas that is naturally present deep below the surface. Storage facilities are often kept at high pressure so the injected gas can easily be removed when needed. Oil fields, on the other hand, generally have constantly declining pressure throughout their lifespan.
As noted above, Aliso Canyon was initially an oil production field. Like most Southern California oilfields, wells are drilled to produce oil, and natural gas is mostly an associated product that is either sold to a utility or used by the producer for on-site energy needs.
Given that oil production has been occurring in the field for nearly a century, the oil reservoirs are not under high pressure. Decades of production have relieved naturally occurring pressure and now in order to produce, oil companies must use “artificial lift” such as a pumping unit to get the crude to flow to the surface. Another result of the state’s mature, low pressure reservoirs is that an average oil well in California produces just 11 barrels a day aided by artificial lift.
Conversely, natural gas storage facilities like Aliso Canyon are purposely kept at high pressure at the beginning of winter, so that the natural gas will flow to the surface when the utility is ready to remove gas from the storage facility. This is one of the conditions making the repair of the damaged injection well difficult. This would not be the case with an oil production well. If an issue were to develop with the well casing, the crude (which is normally heavy and viscous in nature), would not naturally flow to the surface.
Another important distinction is that stored natural gas under this pressure will expand by 200 times its volume as it moves from the bottom of the well and is released to the atmosphere. Oil is incompressible in comparison to gas and is essentially unchanged in volume when it is lifted out of the ground. Think of the difference between shaking a bottle of champagne before opening it, and doing the same with a bottle of salad oil.
Residents in the nearby Porter Ranch community have reported smelling the released natural gas. Natural gas is colorless and odorless and what the residents are likely smelling is a gaseous product called “mercaptan” that is added by the utility to the natural gas before it is injected. Mercaptan is a relatively harmless, but pungent smelling gas which has been described as having the stench of rotting cabbages or smelly socks. It is added to utility provided natural gas to make it safer by making leaks more detectable. Since oil is not gaseous and therefore not a risk of undetected air release, there is not the need to add mercaptans. Mercaptans are another way gas storage facilities and production wells are different.
Governor Edmund G. Brown Jr. issued a proclamation that declared the situation an emergency and detailed the administration's ongoing efforts to help stop the leak. The order also directs further action to protect public health and safety, ensure accountability, and strengthen oversight of gas storage facilities.
The Division of Oil, Gas, and Geothermal Resources is investigating the leak and overseeing Southern California Gas Company's efforts to stop it, including issuing emergency orders in November and December directing Southern California Gas Company to halt gas injections into the storage facility, immediately work on alternatives to stop the leak, and provide testing results, data, daily briefings, and a written plan and schedule for sealing the well.
The state will promulgate emergency regulations for gas storage facility operators throughout the state, requiring: at least daily inspection of gas storage well heads using gas leak detection technology such as infrared imaging; ongoing verification of the mechanical integrity of all gas storage wells; ongoing measurement of annular gas pressure or annular gas flow within wells; regular testing of all safety valves used in wells; minimum and maximum pressure limits for each gas storage facility in the state; a comprehensive risk management plan for each facility that evaluates and prepares for risks, including corrosion potential of pipes and equipment. Additionally, the Division of Oil, Gas and Geothermal Resources, the California Public Utilities Commission, the California Air Resources Board and the California Energy Commission will submit to the Governor's Office a report that assesses the long-term viability of natural gas storage facilities in California.