COALBED METHANECOALBED METHANE----A NONA NON--CONVENTIONAL ENERGY SOURCECONVENTIONAL ENERGY SOURCE
WHAT IS IT AND WHY IS IT IMPORTANT
ROBERT A. LAMARRELAMARRE GEOLOGICAL ENTERPRISES
Fueling The Future25th Annual North American Conference of the USAEE/IAEE
Sept. 20, 2005
Natural Gas Production, Consumption, and Imports,1970 - 2025 (trillion cubic feet)
0
5
10
15
20
25
30
35
1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
Consumption
Production
Net Imports History Projections
0
1
2
3
4
5
6
Pipeline Liquefied Natural Gas
Natural Gas Net Imports, 2001 and 2025(trillion cubic feet)
2001
2025
(EIA)
0
2,000
4,000
6,000
8,000
10,000
12,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Gas
Pro
duct
ion
(mm
cfd)
Tight Gas
CBM
Conventional Gas
Major Growth in Production from Unconventional Resources
• Tight Gas - 2.3 bcfd in 2004 to 4.1 bcfd in 2010• CBM - 1.8 bcfd in 2004 to 3.9 bcfd in 2010• Conventional Gas - 2.5 bcfd in 2004 to 2.3 bcfd in 2010
Approx. 42% growth expected across the
Rockies
2005 - 2010
CBM offers the greatest potential with 116% volume
growth
Wood MackenzieWoodmac.com
Scott Tinker, DirectorBureau of Economic GeologyAugust 4, 2003
Why Natural Gas?Efficiency
QAd1023
Scott Tinker, DirectorBureau of Economic GeologyAugust 4, 2003
PREFERRED ENERGY SOURCE
COAL-FUELED ELECTRICITY-GENERATING PLANT AND CBM WELL IN UTAH
NATURAL GAS IS A CLEAN BURNING FUELNATURAL GAS IS A CLEAN BURNING FUEL
METHANE GAS PRODUCED FROM UNDERGROUND COAL BEDS
COALBED METHANE IS FORMED DURING THE COALBED METHANE IS FORMED DURING THE CONVERSION OF PEAT TO COALCONVERSION OF PEAT TO COAL
TimeTime
It all starts with Organic Debris or
• Peat in a Swamp
Pressure
Expelled By-Products• Water• Methane• Carbon Dioxide (CO2)
Heat
Residual Products• Coal• Methane• CO2
Coal
Coal is formed from peat over time by heat and pressure
ALL Consulting 2/04
PEAT SWAMP
COAL
PRESERVED TREE TRUNK
Natural Resources Law Center 7/02
GAS CONTENTS OF VARIOUS ROCKY MTN. BASINSGAS CONTENTS OF VARIOUS ROCKY MTN. BASINS
IDEAL RANK
(Scf/t)
CBM HAS BECOME AN IMPORTANT SEGMENT OF US GAS PRODUCTION
Conventional Natural Gas74%
Tight Gas Sands14%
Coal BedMethane
10 %Gas Shales
2%
U.S. CONSUMES 19 TCF OF GAS ANNUALLY
U.S COALBED METHANE PROVED RESERVES, 1989-2003
18.7 TCF
ROCKIES BUSINESS UNIT
UINTA3.2 TCF
SAN JUAN7.5 TCF
U.S. CONTAINS 703 TCF OF CBM RESOURCES
ARKOMA2.6 TCF
RATON1.8 TCF
POWDER RIVER25 TCF
GRN. RIVER3.9 TCF
WIND RIVER0.4 TCF
W. WASH0.7 TCF FOREST CITY/CHEROKEE
2.4 TCF ILLINOIS1.6 TCF
N. APPAL.11.5 TCF
CENTRAL APPAL.3 TCF
BLACK WARRIOR
PRODUCING
EMERGINGPLAYS
IDENTIFIED POTENTIAL
PICEANCE 7.5 TCF
GRI
U.S. CBM RESOURCES
• Greater Green River Basin 314 Tcf• Piceance Basin 99 Tcf• San Juan Basin 50 Tcf• Powder River Basin 30 Tcf• Uinta Basin 10 Tcf• Raton Basin 10 Tcf
TOTAL 513 TCF
Meissner
CBM IN U. S. LOWER 48 STATES
• 13 TCF PRODUCED• 18.7 TCF PROVED RESERVES• 42.3 TCF ECONOMICALLY RECOVERABLE• 101.2 TCF UNDISCOVERED• 703 TCF TOTAL RESOURCE ESTIMATE• >14,000 WELLS• 1.6 TCF PRODUCED IN 2003• >10% OF U.S. NATURAL GAS PRODUCTION
Data as of 12/03
Gas Molecule
ADVANTAGES OF COALS ASRESERVOIRS
Large gas storage capacityShallow depthsRelatively low costVery good economicsMost coal basins have been mappedAbundant data from logs of older wells
PRODUCTIVE STAGES OF ACOALBED METHANE WELL
(1)DEWATERING
STAGE
(2)STABLE
PRODUCTIONSTAGE
(3)DECLINE
STAGE
VO
LU
ME
TIME
TYPICAL PUMPING UNIT ON A CBM WELL
Schwochow, Oil & Gas Investor Supplement Coalbed Methane, Dec. 2003, page CBM-11
GAS PRODUCTION CURVES FOR CBM & SANDSTONE
COMPARISON OF GAS PRODUCTION CURVESExh. # 9
EXAMPLE OF SUCCESSFUL EXAMPLE OF SUCCESSFUL DRUNKARDDRUNKARD’’S WASH CBM PROJECTS WASH CBM PROJECT
0
200
400
600
800
1000
1200
0 10 20 30 40 50 60 70 80
PRODUCTION MONTH
MC
FD, B
PD P
ER W
ELL
0
20
40
60
80
100
120
140
160
180
200
# W
ells
Water Gas # Wells
NOTE DECREASING WATER RATES
MEANS LOWER OPERATING COSTS
NOTE INCREASING GAS RATES
MEANS MORE$$
From Sproule
6666 MCFD
No. of Wells vs Time MMcfd vs Time
www.eia.doe.gov/
NUMBER OF WELLS AND DAILY PRODUCTION VERSUS TIMEIN POWDER RIVER BASIN
365 BCF/YR
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
1995 1997 1999 2001 2003
CBM PRODUCTION IN UTAH
MCF
Thru April
102.2 Bcf
04
THE CRETACEOUS SEAWAY CONTAINS THE CBM PROJECTS IN THE ROCKIES
INTER
IOR
CR
ETAC
EOU
S SEAW
AY
RYER, 1988
Horne, RMAG 2003
TYPICAL COAL DEPOSITIONAL ENVIRONMENTTYPICAL COAL DEPOSITIONAL ENVIRONMENTFOR CRETACEOUS ROCKS IN THE ROCKIESFOR CRETACEOUS ROCKS IN THE ROCKIES
Coal
ShorelineSandstones
Swamp/Lagoon
Marine
POTENTIAL FUTURE COAL BEDS AND CBM
Natural Resources Law Center 7/02
MAJOR COALMAJOR COAL--BEARING BASINSBEARING BASINSIN THE ROCKIESIN THE ROCKIES
OVE
RTH
RU
ST C
OAL
SO
VER
THR
UST
CO
ALS
www.wsgsweb.uwyo.edu/
NNOO
PP
USGS PP1625B, 1999 Kirschbaum et al
COALCOAL--BEARING AREAS IN THE FOUR CORNERS REGIONBEARING AREAS IN THE FOUR CORNERS REGION
FERRON PLAY
CBM POTENTIAL INBLACK MESA BASIN
(No Tests)
SAN JUAN BASIN
PICEANCE BASIN
Horne, RMAG 2003
COALCOAL--BEARING CRETACEOUS FORMATIONSBEARING CRETACEOUS FORMATIONS
10,0
00 F
EET
Ryer, T.
PRODUCTIVE COAL SEAMS IN THE VERY SUCCESSFUL FERRON CBM PLAYOF EAST-CENTRAL UTAH
COAL
SCHEMATIC CROSS SECTION MESAVERDE DEPOSITIONAL SEQUENCE
SANDSTONE Reservoir
COALS Source & Reservoir
Top Seal
Bottom Seal
AN IDEAL “GAS MACHINE”
Meissner
COAL
COALBED METHANE
THE FUTURE LOOKS BRIGHT FOR CBM
ENERGY SUPPLY AND
ANCIENT SWAMPS