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Unconventional gas background

Summary

30 Jan 2010.

The core definition of unconventional gas (sometimes called continuous) is that the gas is highly dispersed in the rock, rather than in a concentrated bubble over oil or water. The main types of unconventional gas are deposits in shale (“shale gas”), in sandstone (“tight gas”), in coal (“coalbed methane”), or in ice (“gas hydrates”).

Mining of unconventional gas is relatively new. It began with tight gas and coalbed methane in the 1980s and 90s, and has recently expanded into shale. The main enabling technologies are horizontal drilling and hydraulic fracturing, both aimed at connecting a large volume of fractured rock to the well.

Because the area is so new, there remain significant unknowns. The first is that the environmental impact, especially contamination of aquifers, is not well characterized. The second is that the long term productivity of wells, and hence the cost and size of ultimate recovery volumes, is unclear.

Highlights

Clippings below covered through 23 Dec 2009.

Definitions (30 Jan 2010) There is not a standard definition, however the core idea is the same across different sources.

  • The core idea of “unconventional” gas is that the gas is highly dispersed in the rock, rather than in a concentrated bubble over oil or water.
  • Some prefer the term “continuous”, to mirror the geology.
  • The main types of unconventional gas are deposits in shale (“shale gas”), in sandstone (“tight gas”), in coal (“coalbed methane”), or in ice (“gas hydrates”).

Environmental concern (30 Jan 2010)

  • The fracturing fluid is mainly water and sand, but it also contains a number of other chemicals: acids, biocides, detergents, potassium chloride, lubricants, corrosion inhibitors, etc.
  • The fracturing process introduces this fluid at very high pressures, and spreads it widely, by design. There is some evidence that it may contaminate aquifers.
  • In at least one case, where drilling had been planned in a watershed serving New York city, protests caused the plans to be shelved.

History (30 Jan 2010) Two brief recaps of the history:

  • Schlumberger: “To keep up with a growing market and depleting reservoirs, producers in the 1980s began looking beyond traditional sources of natural gas into the more difficult tight gas sands. By the early 1990s, they were also looking at coalbed methane. Today the industry is moving into shale.”
  • Advanced Resources Int'l: “a “paradigm shift” is underway on world natural gas supplies. … [It] began a decade ago in North America … Low cost coalbed methane in the San Juan Basin of Colorado and New Mexico led the way. Next was the introduction of highly productive tight gas development at the Jonah and Pinedale fields in western Wyoming. Third was the emergence of the Barnett and now the other North American gas shales. The final segment of the “paradigm shift” - - the worldwide pursuit of gas shales and unconventional gas - - has only just started, with Australia, China and Europe in the lead. ”

Recovery (30 Jan 2010) Because shale gas mining is still relatively new, and the technology is still improving, there are disagreements about how much gas can be recovered in practice, and how much it will cost. In particular, it is notable that the impressive estimates found in most newspaper reports are for the somewhat vaguely defined “technically recoverable” resources, while what will actually matter in the long term is what is economically recoverable.

Technology (30 Jan 2010) The main enabling technologies are horizontal drilling and hydraulic fracturing, both aimed at connecting a large volume of fractured rock to the well. A 2005 summary from Schlumberger: “Effective, economic hydraulic fracturing and horizontal drilling are the primary enabling technologies behind the recent surge in shale gas production. Long a dream of the petroleum industry, horizontal drilling came into widespread use in the mid-1990s. … Fracturing involves isolating sections of the well in the producing zone, then pumping fluids and proppant(grains of sand or other material used to hold the cracks open) down the wellbore through perforations in the casing and out into the shale. The pumped fluid, under pressures up to 8,000 psi, is enough to crack shale as much as 3,000 ft in each direction from the wellbore.”

See also

Below are clippings used in the construction of this page

USGS non-conventional gas definition

May 2005. Paper on USGS web site.

http://certmapper.cr.usgs.gov/data/noga00/natl/text/CH_13.pdf

“U.S. Geological Survey Assessment Concepts for Continuous Petroleum Accumulations. By James W. Schmoker”

“Continuous petroleum accumulations form a geologically diverse group that includes coalbed methane, “tight” gas, basin-center gas, oil and gas in fractured shale and chalk, gas hydrates, and shallow biogenic gas. Despite their obvious differences, these various petroleum deposits are linked together as continuous accumulations by two key geologic characteristics: (1) they consist of large volumes of rock pervasively charged with oil or gas, and (2) they do not depend upon the buoyancy of oil or gas in water for their existence.”

Schlumberger backgrounder on technology for production of shale gas

Oct 2005. Schlumberger web site.

http://www.slb.com/media/services/solutions/reservoir/shale_gas.pdf

“Shale gas. Joseph H. Frantz, Jr. and Valerie Jochen”

“In many oil fields, shale forms the geologic seal that retains the oil and gas within producing reservoirs, preventing hydrocarbons from escaping to the surface. In a handful of basins, however, layers of shale—sometimes hundreds of feet thick and covering millions of acres—are both the source and reservoir for natural gas. These shales have one thing in common: They are rich in organic carbon. … most shale gas is fairly clean and dry. That’s because over time, there has been enough heat in the reservoir rock to break down any liquid hydrocarbons. … The Barnett Shale in the Fort Worth basin of North Central Texas is by far the most active shale gas play in the United States. The reservoir ranges from 100 ft to more than 1,000 ft in gross thickness and holds from 50 ×109 ft3 (50 bcf) to 200 bcf of gas per square mile. The Gas Technology Institute estimates that organic shale reservoirs in the United States contain up to 780 trillion (780 ×1012) ft3 of gas. Equally gas-rich organic shales almost certainly exist elsewhere around the world, but so far the United States is the only country with a large shale gas industry. … To keep up with a growing market and depleting reservoirs, producers in the 1980s began looking beyond traditional sources of natural gas into the more difficult tight gas sands. By the early 1990s, they were also looking at coalbed methane. Today the industry is moving into shale. In 2000, there were 28,000 shale gas wells in the United States, with a combined production of more than 700 bcf per year. … Except for the earliest wells, operators have historically ignored shale. What’s more, shale gas can occur where there is no traditional oil and gas production, so many prospects remain unexplored. There’s a fair amount of excitement that reminds some observers of the early days of the oil industry. Suddenly, many new areas are attractive. Shale gas operators across the Mid-Continent and Western United States are leasing hundreds of thousands of acres, all looking for the next big play. … Effective, economic hydraulic fracturing and horizontal drilling are the primary enabling technologies behind the recent surge in shale gas production. Long a dream of the petroleum industry, horizontal drilling came into widespread use in the mid-1990s. Horizontal drilling has been an efficient way of removing gas from conventional reservoirs, coal seams, and even from tight gas reservoirs. Now drillers are using it to enhance recovery rates in the ultralow permeabilities they encounter in shale. … Fracturing involves isolating sections of the well in the producing zone, then pumping fluids and proppant(grains of sand or other material used to hold the cracks open) down the wellbore through perforations in the casing and out into the shale. The pumped fluid, under pressures up to 8,000 psi, is enough to crack shale as much as 3,000 ft in each direction from the wellbore. … Shale gas wells don’t come on as strong as tight gas, but once the production stabilizes, they will produce consistently for 30 years or more.”

Composition of fracturing fluid

21 Sep 2009. Advanced Resources presentation slides.

http://www.adv-res.com/pdf/Kuuskraa%20EFI%20Natural%20Gas%20SEP_21_09.pdf

“Paradigm Shift in Domestic Natural Gas Resources, Supplies and Costs. Vello Kuuskraa, President ADVANCED RESOURCES INTERNATIONAL, INC.”

[Follow link for a figure showing typical composition of fracturing fluid.]

Shale gas resource numbers may be too optimistic

2 Nov 2009. FT fm p11.

“Shale gas numbers may not add up. John Dizard”

“shale gas fields have gone from having about 15 per cent of the total gas exploration and production spending committed to them to well over half. Enormous reserves have been found. But how much can be produced economically, and how quickly?

The leading shale sceptic analyst is an independent geologist, Art Berman, often described as a “radical”. Rather soft spoken, though, he says: “I hope I'm wrong about shale.” The problem, as he sees it, is that the standard industry analysis about shale well Estimated Ultimate Recovery, or lifetime production, is too optimistic. “They have fantastic initial rates, but the question is whether the (rate of production) persists as they say.” For example, he says, in deep shale formations “the rock collapses as gas is produced, and crushes the proppant. And as the fractures are drained you have to frac and frac and frac.” Expensive.

Dan Pickering, director of research at the Houston investment firm of Tudor Pickering Holt, counters: “Berman's decline curve analysis is looking too early in the production curves to judge where the decline (rate) will actually be. As for rising decline rates, I think exploitation techniques have improved, so rising decline does not necessarily mean worse economics.”

Ben Dell, of Bernstein Research in New York, whose work is respected by both sides in the debate, says: “The average well deteriorates more in quality, and more wells fail, than people believe. Still, I think a rise in prices would make more (shale prospects) economic. Plenty of plays work at $9 per mcf [1,000 cubic feet].”

This less-than-expected productivity in the leading gas sector tells Mr Dell that US gas production will decline on the order of 10 per cent next year, leading to $8-$9 gas, or $3 to $4 more than the forward curve anticipates. ”

Kuuskra overview on shale gas

12 Dec 2009. Presentation at the United Nations Climate Change Conference in Copenhangen.

http://www.adv-res.com/pdf/Kuuskraa%20Condensed%20Worldwide%20Uncon%20Gas%2012_12_09.pdf

“Worldwide Gas Shales and Unconventional Gas: A Status Report. Vello A. Kuuskraa, Scott H. Stevens, ADVANCED RESOURCES INTERNATIONAL, INC.”

“Driven by a new understanding of the size and availability of gas shales and unconventional gas, a “paradigm shift” is underway on world natural gas supplies.

This “paradigm shift” began a decade ago in North America with only modest fanfare. Low cost coalbed methane in the San Juan Basin of Colorado and New Mexico led the way. Next was the introduction of highly productive tight gas development at the Jonah and Pinedale fields in western Wyoming. Third was the emergence of the Barnett and now the other North American gas shales.

The final segment of the “paradigm shift” - - the worldwide pursuit of gas shales and unconventional gas - - has only just started, with Australia, China and Europe in the lead. Europe, still in “dress rehearsal”, could also emerge with a lead role.”

Opposition to shale fracturing

18 Dec 2009. FTUSA p18.

“Horizontal drilling”

“The technology that has ushered in a renaissance in US natural gas production … may be polluting drinking water. Hydraulic fracturing, or fracking, pumps millions of gallons of water and chemicals into rocks at high pressure to break them apart and release hydrocarbons. …

individual actions by states or private lawsuits could give the industry headaches. … New York City's budget office estimates that drilling in the city's main watershed might cause the already cash-strapped authority to spend an additional $6bn-$10bn in water filtration infrastructure. …

Greener technologies already have been proposed by operators such as Schlumberger, but piling costs on to what is already an expensive form of drilling could make some fields uneconomical.”

An example of environmental concern

23 Dec 2009. NYTimes.

http://www.nytimes.com/2009/12/24/science/earth/24drill.html

“City Agency Warns Against Gas Plan. By SINDYA N. BHANOO”

“New York City environmental officials said Wednesday that months of scientific research had indicated that hydraulic drilling for natural gas would contaminate the watershed serving the city. …

Already concerned about the watershed, the city’s environmental department had hired scientists and environmental engineers specializing in gas drilling to begin researching the potential impact of the drilling last January. The report argues that drilling is dangerous for several reasons. …

Paul Rush, the department’s deputy commissioner …

Extracting gas from the shale involves blasting water, mixed with chemicals into the rock at a high pressure, which causes the natural gas to flow out. The chemicals result in significant amounts of wastewater that can contaminate water supplies and damage the infrastructure, the report found.

Twenty to 50 percent of the chemicals used in extraction results in wastewater, for which the state currently has no disposal method, Mr. Rush said. …

Citing data from drilling in Fayetteville, N.C., the scientists estimated that drilling in the New York watershed could result in hundreds of tons per day of fracturing chemicals seeping through the watershed over a 20-year period.

Massive industrial development would be needed to dig and maintain the 3,000 to 6,000 wells that would be dug in the watershed, the report said. Maintenance alone could result in up to 600,000 truck trips per year within the watershed’s boundaries alone, it said.

Responding to rising public concern, the Chesapeake Energy Corporation, which currently owns the lease to drill in the watershed, announced in October that it did not plan to drill in the watershed under its current lease.”

Secretary of Energy Advisory Board on shale gas

11 Aug 2011. DOE.

http://www.shalegas.energy.gov/index.html

[Sensible recommendations on methane air pollution and fracking water pollution. No new regulations yet.]

EPA on possible contamination of groundwater in Wyoming from fracking

9 Dec 2011 overview from Forbes.

http://www.forbes.com/sites/christopherhelman/2011/12/09/questions-emerge-on-epas-wyoming-fracking-study/

8 Dec 2011 EPA report.

http://www.epa.gov/region8/superfund/wy/pavillion/EPA_ReportOnPavillion_Dec-8-2011.pdf

“Investigation of Ground Water Contamination near Pavillion, Wyoming”

[regarding organic contaminants,] when considered together with other lines of evidence, the data indicates likely impact to ground water that can be explained by hydraulic fracturing. …

Although some natural migration of gas would be expected above a gas field such as Pavillion, data suggest that enhanced migration of gas has occurred within ground water at depths used for domestic water supply and to domestic wells. Further investigation would be needed to determine the extent of gas migration and the fate and transport processes influencing migration to domestic wells.

9 Dec 2011 industry response, in Energy in Depth

http://www.energyindepth.org/six-questions-for-epa-on-pavillion/

Evidence of groundwater contamination from fracking

27 Jun 2013. Nature 498, 415

http://www.nature.com/news/gas-drilling-taints-groundwater-1.13259

“Gas drilling taints groundwater. Jeff Tollefson”

“As shale-gas operations expand across the United States, industry officials and environmentalists are at loggerheads over whether or not shale-gas extraction can contaminate groundwater. Now researchers have traced low levels of methane and other contaminants to a source of shale gas: the sprawling Marcellus Formation, which lies beneath much of New York state, Pennsylvania, West Virginia and Ohio …

“The problems we’ve seen are probably more common than people realize,” says Rob Jackson, director of Duke’s Center on Global Change and lead author of the paper. Jackson stresses that the contamination is probably due to poor well construction, rather than hydraulic fracturing itself. But he says that the results are another “wake-up call” for the industry to improve its drilling operations. …

Jackson’s team found methane in 115 of the 141 shallow drinking-water wells that it sampled. To trace its source, the team examined carbon-isotope ratios of the methane molecules — these ratios differ depending on whether the gas was produced by microorganisms in relatively shallow water or by heat and pressure deep in the Earth. The team also looked at the relative concentrations of ethane, propane and helium — other common by-products of gas extract­ion that are rare in shallow groundwater sources.

The results suggest that home­owners living up to 1 kilometre from shale-gas wells probably have groundwater contaminated by gas from the Marcellus Formation. But the team did not find evidence that chemicals used in fracking migrated from depth to contaminate aquifers. Jackson says that the methane is probably from leaks in the well casing itself, which would allow direct contamination. The data also suggest that some gas migrated up from geological layers between the Marcellus Formation and the groundwater table. …

Steve Everley, a spokesman for Energy In Depth, a research and advocacy arm of the Independent Petroleum Association of America, based in Washington DC, says the Duke study is inconclusive. He notes that recent baseline testing by the US Geological Survey found non-microbial methane in two groundwater wells in northeastern Pennsylvania even before drilling. …

“This is about well integrity,” he says. “The industry knows how to do this, and they work hard to maintain well integrity.””