Sinopec plans second gas storage facility at China's Zhongyuan block

State-owned China Petroleum & Chemical Corp or Sinopec, is developing a second natural gas storage facility, with a capacity of 10.42 billion cubic meters, at the onshore Zhongyuan block in China, the company said Monday on its website.

Results of the feasibility study for the Wen-23 gas storage project have already been approved by the National Development and Reform Commission, the company said without providing a timeline for completion.

This follows the Wen-96 project -- the company's first gas storage facility developed from a depleted underground gas reservoir -- which started operating in September last year.

The company said the Wen 96 project has accumulated 232 million cu m of gas to date, and is expected to store a further 60 million cu m over the coming winter and spring seasons. It will help to fulfill winter gas demand in parts of eastern Shandong and central Henan provinces, Sinopec said. The project has storage capacity of 588 million cu m and stores gas from the Wen 96 gas field in the Zhongyuan block. It has hit a gas gathering rate of 2 million cu m/d, Sinopec said, higher than the 1.3 million cu m/d announced in July this year.

The two projects are part of previously announced plans to develop more than 20 gas storage facilities to help ease shortages during peak demand periods.

The central government has once again urged state-owned companies to step up efforts to maximize gas supplies over the November-March period, when cold winter weather is expected to lead to a spike in demand for the fuel, which is primarily used for residential heating.

Sinopec said early this month that it intends to increase its gas supply to the domestic market for the upcoming winter and spring by 10.5% year on year to 7.58 billion cu m.