Companies are planning a wave of 16 projects along the Gulf Coast to store natural gas underground in salt caverns to supply the growing number of liquefied natural gas (LNG) export terminals and provide backup fuel for the booming data center industry.

The construction of five new caves to store natural gas, plus 11 expansions of existing gas storage caverns, will provide 359 billion cubic feet of space to store natural gas – about as much as can be held by 65 LNG tanker ships. This will increase by 50 percent the amount of this kind of storage available today in the U.S., according to public records and company announcements in the Oil & Gas Watch database.

Developers build underground storage caverns for natural gas by pumping water into underground salt formations, which dissolves the mineral. Companies then pump the salty water out, leaving caves that are plugged, filled with gas, and tapped when needed.  Storing gas in depleted oil and gas wells is also common.

Although salt caverns have been used to store natural gas since the 1950s, the sudden growth reflects a surge in LNG terminals and exports, an increasing number of pipelines to serve those terminals, and the ravenous appetite of the data center industry, which needs fuel and backup supplies of gas, industry analysts say.

“If you build pipelines from West Texas to the Gulf Coast, you've got to have a place to park the gas before you put it into the LNG terminal, before you send it to a power plant, or before you send it out to a data center,” said Harold “Skip” York, a nonresident fellow in energy and global oil in the at the Rice University Baker Institute Center for Energy Studies. “So part of the reason why you're building storage is because you're building pipelines that are ending on the Gulf Coast.”

Environmentalists fear that building and expanding so many caves full of methane will lead to more leaks of a powerful greenhouse gas and potential accidents and explosions.

"Storing tens of billions of cubic feet of highly pressurized methane underground is inherently risky,” said Luke Metzger, Executive Director of Environment Texas. “At a time when Texas should be reducing methane pollution, these projects would lock us into more fossil fuel infrastructure to serve growing LNG exports and data center demand. Regulators should require rigorous safety reviews and continuous methane monitoring before approving them."

Eight of the proposed storage caverns would be in Texas, five in Louisiana, and three in Mississippi, according to the Oil & Gas Watch database. 

The largest construction project out of the 16 would be the Vinton Dome Gas Storage Hub, which would hold 44.5 billion cubic feet of gas southwest of Lake Charles, Louisiana. Nearby is the planned Black Bayou Gas Storage Facility, which would hold 44.4 billion cubic feet. They would serve the industry in a section of Louisiana that has at least a half dozen LNG export terminal construction and expansion projects planned.

Community groups and fishers in Louisiana have expressed strong opposition to these gas storage facilities because they could leak.  

"While the project aims to enhance regional energy infrastructure, it has raised significant environmental and community concerns that must be thoroughly evaluated," wrote Roishetta Ozane, executive director of the Vessel Project of Louisiana, in a comment submitted to the Federal Energy Regulatory Commission. She argues that the project could increase the risks of  “potential contamination of local water sources, disruption of sensitive habitats, and increased pollution from construction and operational activities."

Four of the salt cavern storage projects are being planned by Enbridge, a Canadian company that operates one of the biggest natural gas pipeline and storage systems in the U.S. Their projects are the Egan storage facility in Acadia Parish, Louisiana; a pair of Moss Bluff facilities in Liberty County, Texas; and Tres Palacios, in Matagorda County, Texas.

In announcing the projects, Enbridge CEO Greg Ebel cited both the rapid growth of the LNG industry and rising demand for backup fuel for the growing number of data center power plants. 

“We can strongly support our customers as they continue to build out North America's LNG capacity and navigate the overall power demand growth,” Ebel said in a press release. “Our gas distribution teams are now advancing more than $4 billion of data center and power generation opportunities.”

The growth of wind power and solar power have also increased the need for natural gas generators – and methane storage in underground caverns – as backup when the wind dies or cloudy weather interferes with solar, according to RBN Energy, a Houston-based energy consulting and intelligence firm.

“Several factors — rising gas production, increasingly undulating demand for gas (tied in part to the ups and downs of wind and solar power), frequent extreme weather events, new LNG export capacity, and plans for lots of new gas-fired power generation — have been boosting the value of storage in Texas, Louisiana, Mississippi and Alabama,” Housley Carr wrote on RBN Energy’s daily energy blog.

In the long run, however, the eventual shift away from fossil fuels and toward electric power – for example to heat homes and light stoves – could make all these huge investments in natural gas storage and export terminals a gamble, said Paasha Mahdavi, a professor at the University of California Santa Barbara and director of the Energy Governance and Political Economy Lab.

This is especially true regarding the overbuilding of LNG terminals along the Gulf Coast, with many of them aiming to profit from selling U.S. natural gas to Europe while the Russian war on Ukraine continues to rage and create barriers for Russian gas. Many of these European countries will likely move away from gas altogether, which could mean all the new LNG terminals and storage caverns along the Gulf Coast could lose their market, Mahdavi said.

“It does generally seem misguided to be trying to put so many eggs in this basket to try to push for LNG because that does ultimately seem risky in the sense of building this amount of infrastructure,” Mahdavi said. “And we also know about a lot of the negative environmental concerns related to these facilities, with methane leakage being a really big one.”