Carbon dioxide and oil & gas (By Sam A Rushing)
About the author
Sam A. Rushing, a chemist, is President of Advanced Cryogenics, Ltd., a major CO2 and cryogenic gas consulting firm, headquartered in Florida. Work from technical thru market and business oriented is offered with ‘excellent results’.
Some fear carbon dioxide (CO2) atmospheric content may grow two or three fold by the end of the 21st century, should major carbon emissions continue at their current rate – and that is quite frightening, expensive and perhaps, catastrophic.
Many such statements about possible doom are broadcast all the time; however at the very least, we all need to play a role in greenhouse gas mitigation, both as an industry and on a personal level.
With respect to carbon sequestration, a major sink is geologic in nature, and enhanced oil recovery (EOR) happens to sequester significant sums of CO2, along with increased oil production – so this is needed more than ever. A particularly large sector for crude CO2 usage as a liquid product is the EOR sector, by volume, compared to single volume supply to one or a few typical merchant consumers, such as food and beverage customers.
Today, due to pressure from environmental sectors, wishing to reduce CO2 greenhouse gas emissions, coupled with a strong need to produce more oil domestically, EOR and more creative means of producing oil and gas in general are very much in fashion. This big push to produce more oil via EOR is a reality and, for the (natural) gas sector, this is evidenced by all the shale formation sources that are now being developed for more gas production, and horizontal drilling. The end result is more fossil fuel for the immediate term – and the foreseeable future.
This end result could also be good news for the gases business and more specifically, the CO2 sector, as explored here.
Much has been written about biofuels as a necessary component of the gasoline and diesel mix future.
Biofuels will certainly become more practical, cheaper to produce, and more available, particularly as advanced biofuels become a significant commercial factor, where these advanced biofuels are only in test, demo and pilot modes so far in North America.
The advanced biofuels are those composed of non-edible grain materials, sometimes called cellulosic fuels, of which there are algae, energy-rich sources of valuable oils for extraction, plus the algae mass for fertiliser and cattle feed.
In terms of natural gas applications for CO2, otherwise known as ‘frac’, this sector can conceivably consume huge sums of carbon dioxide for literally fracturing sub-surface geological structures, thus releasing natural gas content. With respect to this sector, single jobs for frac service can range, for example, from less than one ton to thousands of tons per job.
When the volume is particularly large, significant portable storage or large stationary vessels are brought in to serve these locations with sufficient volume on-site, and the job can take days to complete. The same can apply to EOR projects, in terms of on-site storage, depending upon mode of supply, duration and size of the job. In both cases, this ‘downhole’ application requires significant pressures to achieve the goals sought, such as compression equipment on-site, and if the liquid is delivered to an EOR project, which is always a long term venture, then compressor stations may also play a role throughout the length of the pipeline.
Further, there would be possible applications in CBM, or coal bed methane projects; that would be specifically advanced CBM, when replacing the molecules of methane – as natural gas production with CO2 in coal seams, coal beds, and specific coal borne natural gas opportunities. This is an excellent way, as EOR is for the sequestration of CO2; thus a dual opportunity, when working with carbon dioxide.
CO2 in the oil and gas industries
The physical application of CO2 in EOR jobs exists in places such as the Jackson Dome (in Mississippi) which is primarily operated by Denbury Resources, a Dallas area oil firm owning the majority of the massive CO2 reserves in the Dome – and a company that is pursuing the ongoing purchase of regional oilfields, for the delivery of the CO2 from the dome, via pipeline.
Long-term plans are to continue EOR from this source indefinitely, we understand. Other domes which supply EOR CO2 to places include the Permian Basin, a major producing region in West Texas and Eastern New Mexico,.
Today, the opportunity for EOR is often perceived to be more viable than ever due to high prices for oil, coupled with dire needs to address carbon offsets and greenhouse gases in general. It is a safe assumption to say oil prices should remain high for a long time, more than likely.
States in the US and other world markets are now evaluating CO2 floods (another common term in EOR) for oil producing regions, sometimes where old, mature and often water-flooded fields are prime for secondary or tertiary CO2 floods. The water flood would be a primary flood, in such a case. The actual physical application of CO2 would be modelled and built upon the success of a pilot flood; using specific geological and physical data, to drive out the most oil possible from a field using this solvent.
The carbon dioxide has many benefits in the process, which of course is under significant pressure, 2,000 psig and beyond, often performing in a ‘sweeping action’ while also reducing the oil’s viscosity, increasing permeability of the rocks and formations, reducing swelling of clays, and dissolving certain carbonates.
One particular EOR project is planning about 4,300 cubic feet of CO2 per barrel of enhanced oil production, and improving carbon storage by around 14-18%, while improving oil recovery rates by 47-50%; however, results and usage for all projects varies according to porosity, permeability, and the geology which compose the field in question. Long-term, it is a ‘win-win’ situation for CO2, more today than ever before, since oil production is ever-important with high prices and scarce supplies – and carbon sequestration is an essential goal everywhere.
We are in a fossil fuel-based economy for a long time to come, and incrementally biofuels and other renewable fuels will help replace fossil fuels over time. For the time being, it is essential to squeeze out what is possible from so many otherwise depleted fields.
These long-term EOR projects often operate for decades, and require a substantial investment in the infrastructure, well beyond the injection and producing wells. This includes pipelines installed at up to $1.5m per mile of construction, and significant compression along the way, plus (typically) a recycling plant to continue the recovery and re-injection of CO2.
The recycling plant would represent a loop system; while continuously feeding additional CO2 from the pipeline and continuously re-injecting, and feeding source product. The payback is a function of operating such an EOR project over the long haul, due to this expensive capital and operational investment.
Frac has been discussed in the media today highly specific to hydraulic fracturing. However, this is separate from what has been so-called traditional fracs. Traditional fracs have often required and greatly benefitted from CO2 as an energised fluid; where hydraulic fracs have not generally called for this requirement. As for traditional frac service, this application for CO2 is generally performed by the oilfield service c
Hydraulic fracturing – The exception to the rule?
I have worked with various projects which conceivably could use carbon dioxide in hydraulic fracturing, in the large major shale fields such as the Marcellus field in the Mid-Atlantic states, the Bakken in the upper plains, the Eagle Ford and Barnett fields in Texas, plus conceivably many more in the Midwest, Southeast and Middle South – plus the Rockies and Southern California.
This existing and potential capacity of new natural gas from the shale fields is nothing short of amazing. However, given all this capacity from all the fields mentioned, this technology, today, does not really call for CO2 usage.
The problem with CO2 usage in hydraulic fracturing is that most of these fractures are generally achieved via (primarily) water, then maybe a small addition of (so-called benign) agents such as sodium chloride, and citric acid; and maybe glycols would be added as well. When I recently worked with CO2 projects surrounding hydraulic fracturing in the southwest, and Middle Atlantic region, the consensus from the major service companies indicated no CO2 use currently – and generally no likely need.
The exception to this may be in truly arid regions of the country with little water, and/or regions with difficulty recycling the water, and disposing of the residue from the process water. Further, there has been some mention of hydraulic frac work possibly using the CO2 in so-called clean-up operations. Therefore, based on what has been said by the major oil and gas service companies, and my work in this sector, there is not a significant market for CO2 in the service of hydraulic fracturing.
The so-called traditional frac work has, and will continue to use CO2; and this is essentially in markets and formations not consistent with the now-popular shale field production of natural gas.
Future for oil and gas production
Some experts see today’s high oil prices as cyclical, and likely to return to more reasonable levels. On the other hand, it seems maybe 15 years ago, when it was difficult to have cheap oil reach $30-35/barrel, compared to today and under $100/barrel – when the producers which I worked for (some years ago) said they needed prices to be at least the mid $30 per barrel of oil to make economics favourable for EOR.
Today we are at truly much higher levels, and perhaps high oil prices will be truly sustained. Oil prices, in any event, are at a point and will be at a point in the long-term, which should precipitate viable economics for the capital investment and returns necessary to make many EOR projects economically viable, assuming all other physical data work for the project in question. Again, traditionally EOR has not been the domain of the CO2 companies, due to the oil companies controlling and operating these projects, which are only the domain of the oil producers, not the gas companies.
However, some of the government-sponsored awards for tests and pilot operations have included some industrial gas concerns. As mentioned earlier, the frac projects are the domain of the industrial gas companies, since they supply the CO2 commodity, along with distribution and portable storage – and require the expertise of the service companies for compression and application. They will continue to work with the oilfield companies to achieve the ultimate end – that being, selling CO2.
CBM has a way to go in terms of being applied on a successfully-broad approach; and have better definitions available to the coal beds under consideration and treatment. Long-term, both EOR and CBM will continue to be excellent forms of carbon sequestration – and as the pressure mounts for America’s energy independence and a need to reduce & sequester carbon emissions, these applications will only grow.
The same applies to all other regions of the globe where imported and scarce oil are such a valuable commodity, along with the need to sequester carbon. Over the decades, with my work in the merchant trade and as a consultant, frac has been a market which has expanded and contracted according to natural gas requirements and selling prices; however, the application will always be around, and gain greater favour, when economics and demands for natural gas strengthen.
Today shale gas is in favour, along with horizontal drilling, and growth in shale gas continues to strengthen, at least for the time being. It is felt this source of natural gas will be truly bountiful and so, in the long-term, sufficient natural gas supplies will be available.
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