The Appalachian Storage Hub

Jan 25, 2018 Transportation & Infrastructure

The Tri-State Shale Summit

In late November, members of the Tri-State Shale Coalition and interested stakeholders from Ohio, Pennsylvania and West Virginia gathered for the third annual Tri-State Shale Summit at Stark State College in Canton, Ohio.

The 2017 Summit was a forum to discuss current efforts promoting the region’s developing shale industries. The Summit addressed the question, “Where have we been and where are we going?” The agenda featured engaging sessions on the coalition’s work in transportation & infrastructure, marketing the region, research & innovation, commercialization, and workforce development. Power of 32 talked to four of the expert presenters who shared the key messages from their presentations.

The big message from Dr. Brian Anderson’s overview on the Appalachian Storage Hub was, “Yes, we have ample geologic opportunity to build and construct storage facilities for natural gas liquid (NGL).”

Dr. Brian Anderson, director of the West Virginia University Energy Institute, was part of the Planned Work for the Future session at the Summit. His presentation on the Storage Hub focused on the geologic investigation of subsurface storage potential for NGLs in a broad geographic area of the tri-state region.

The geologic investigation was a collaborative effort of the West Virginia, Pennsylvania and Ohio state Geological Surveys. The collaboration was spearheaded by the Tri-State Shale Coalition with the assistance of the Benedum Foundation and 12 industry and commercial partners to help fund the one-year effort performed by the three geological surveys to analyze the subsurface potential for building a natural gas liquid (NGL) storage and trading hub.

According to Anderson, the project was “a prime example of a great collaboration among the three states.”

“The way we broke down the work structure among the three state surveys was not by having each group work within the borders of their data,” explains Anderson. “Instead, we actually found experts in each of the Surveys in different rock types, and then shared the data among all three states and had people focusing on one rock type — forgetting where the state borders were because geology doesn’t care.”

The final geological survey report was a critical step in the process of infrastructure development which is key to reinvigorating the region’s petrochemical industry.

In fact, as a follow up to the efforts of the Geological Surveys, it was recently announced that the Department of Energy (DOE) has given approval for the Appalachian Development Group – a collaboration between WVU and MATRIC – to move forward with a part II application for a $1.9-billion loan guarantee from the DOE to build and construct a storage hub.

“That approval is a huge step in realizing the construction of a storage hub,” says Anderson. “And it wouldn’t have happened without the survey and the collaboration across three states. 

“Many people including experts in the petrochemical field believe that the storage hub is an absolutely critical piece of the infrastructure for us to fully realize the potential of the petrochemical industry in the region,” says Anderson.

The construction of storage and trading hub is expected to catalyze the creation of petrochemical investments with a value the American Chemistry Council estimates at $36 billion.

Anderson describes the hub as a number of connected storage facilities. He adds that perhaps the bigger value in the hub is the connectivity of the pipeline, and the efficient movement of raw materials from one place to another. He cites the Gulf Coast as one example of an interconnected industry ecosystem where one plant might create a byproduct, like nitrogen, that a neighboring plant uses and it can be piped from one place to another. 

“We don’t have that interconnected network in our region,” he says. “But if we start moving to the predicted level of investment in chemical and manufacturing facilities we need a better infrastructure to make movement a bit more efficient. It’s more efficient energetically, there’s less emission, less waste and it’s more cost effective — making our region more attractive.”

More Opportunities

At the Summit, Anderson also made a presentation about the West Virginia – China Energy Investment Company agreement signed in November. The partnership is a memorandum of understanding between the state of West Virginia and China Energy, one of the world’s largest energy companies and a long-time research and development partner of WVU, that contains a number of different energy and petrochemical projects that add up to $83.7 billion worth of potential investment. 

One of the announced projects that is in that portfolio is the China Energy interest in the storage hub and potentially being an investor in helping getting that constructed.

In a news release issued by WVU, Anderson says, “This is a game-changer for the state of West Virginia. By collaborating with global companies like China Energy to invest in our state through joint research, business development and demonstration opportunities, we begin to move West Virginia forward by expanding and diversifying our state into newfound prosperity and success.”

You can find Anderson’s presentation at https://www.tristateshalesummit.com/2017-presentations

Proposed Appalachian Storage Hub