June 06, 2006
Tuesday

ALBUQUERQUE, N.M. - Scientists from Sandia National Laboratories are looking to salt away a little extra oil for a rainy day - almost 13 billion gallons.

The Albuquerque facility has been charged with carrying out a congressional mandate to boost the nation's oil stockpile, the Strategic Petroleum Reserve, by 300 million barrels.

A barrel holds 42 gallons of oil - thus, in this case, an extra 12.6 billion gallons. The extra oil would bring the reserve to a total of 1 billion barrels.

The problem is where to put the additional oil.

Now the oil is funneled into man-made caverns in four salt domes, two in Texas and two in Louisiana.

Since January, Sandia scientists have been evaluating five new salt domes in Texas, Louisiana and Mississippi.

U.S. Department of Energy Secretary Samuel Bodman will choose one or two of those sites at the end of July.

After that, Sandia scientists and engineers will design the caverns that will eventually be filled with oil, said David Borns, manager of the labs' Technology and Engineering Department.

"It's insurance," he said of the added capacity.

The United States uses 20 million barrels of oil a day.

Somewhere between 8 million and 9 million barrels a day are produced domestically. The rest is imported from other countries, Borns said.

Canada is the biggest importer to the United States, providing 2.8 million barrels a day. Mexico is next at around 2 million a day.

After that, the United States gets about 1 million barrels a day each from Saudi Arabia, Venezuela, Nigeria and other countries, but some of those countries aren't stable, Borns said.

"About 5 million barrels a day come from insecure areas where you're not sure about delivery," he said.

The new capacity will let the reserve provide 6 million barrels a day, rather than 5 million, which is additional security against those insecure markets, Borns said.

Creating caverns in salt domes to hold the oil is no simple task.

Salt dissolves in water but not in oil. Engineers spray water into the salt domes to carve out the caverns, said Brain Ehgartner, a Sandia engineer leading technical aspects of the project.

After that, oil is pumped into them for storage.

Oil floats on water, and water is used to pump the oil out of the caverns when it's needed.

That water also makes the caverns bigger, because it dissolves more salt from the cavern walls. That's something engineers take into account when they design the caverns, Borns said.

"You do strange initial shapes," he said. "As you pump the oil out of the cavern, it will start widening, and after five cycles, it will be a perfect cylinder."

The caverns must be designed so that even after several withdrawals, they don't interact with one another. If they get too big, they have to be scrapped and new ones built.

At a few of the sites Sandia evaluated, engineers might stack caverns on top of one another, which hasn't been done before. All the existing ones are side by side.

Sandia engineers aren't sure the new layout will be structurally sound, but it does have an advantage, they said. Stacking them in domes that already have caverns means DOE doesn't have to install new pipelines to funnel the oil out, Ehgartner said.

The reserve consists of 62 caverns, which store a total of 727 million barrels. Expanding that reserve will require another 27 caverns, Ehgartner said.

Some of those caverns could be ready in 2007, but all of them should be complete and full by 2003, Borns said.

The reserve was authorized by Congress in the late 1970s in response to the Arab oil embargo and Iranian oil shortage. It's a way to stabilize fluctuations in the oil market, he said.

During times like the late 1990s, when oil was cheap, the reserve buys oil to fill the caverns. Then, when problems like Hurricane Katrina or the Gulf War cripple oil production, the reserve releases the oil to the market at fixed prices to bring domestic gas prices down, Borns said.

"It's a public offering, just like the mercantile exchange," Borns said. "DOE has a secure Web site where different companies can make bids for market value of the oil at that time."

The reason gas prices get inflated even with the reserve, however, is something called "spare capacity."

Countries that produce oil don't typically run their oil production at full bore. They often hold some oil back to keep the market stable, Borns said.

The world needs about 2 million barrels a day in spare capacity to keep the market stable, he said.

Before the second Gulf War, Iraq added about 4 million barrels a day to the market. Its production has stopped since the conflict began, which means most countries are producing all the oil they can to meet the demand, Sandia officials said.

"If Iraq comes back on line, you'll see the oil prices drop, because they provide a huge amount of spare capacity," Borns said. "But that's a big if as to when they're coming online."

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