Underground gas storage is the only economical means today to provide enough storage to meet the seasonal demand peaks of space heating. Most of the present underground gas storages in the United States are in old gas and oil fields, but in the absence of natural gas or oil fields, artificial gas fields have been made where suitable combinations of reservoir beds, cap rocks, and geologic traps are known.

Finding a water-sand storage is a problem in geologic exploration like finding a new oil or gas field, and the same methods are used. Reservoir engineering studies generally are helpful in the evaluation of the suitability of a reservoir rock and cap rock before gas is injected, and can be used to equate the potential storage volume and the well and field withdrawal capacities with the gas company's gas-use pattern. In the development of a water-sand storage, water is pushed away from the storage area by gas injection at a pressure higher than the existing hydrostatic pressure. The fill rate and the cushion-gas volume are important additional factors which influence the engineering design of a storage field.

In the United States more than 30 water-sand storages are now in operation and 14 others are under development. France has three in operation; Germany has two and a third under development. England has two projects under investigation, exploratory work is being conducted near Tokyo, Japan, and Russia has five projects under investigation or development.