BP Exploration (Alaska), Inc.BP Exploration (Alaska), Inc.Methane Hydrate ProjectMethane Hydrate Project

Robert HunterProject Manager, Independent Consultant

September 29, 2003 – DOE Hydrate Conference

Characterize, quantify, and determine commerciality of gas hydrate and associated free gas resources in arctic regions through integrated academic, industry, and government collaborative research to promote safe, low cost, and environmentally responsible production of abundant, strategic, and secure energy resources

Courtesy USDOE

Methane Hydrate Project Methane Hydrate Project Presentation OutlinePresentation Outline

• Research Alignment and Teams

• Gas Hydrate Resource Potential

• Alaska North Slope Review

• BP Gas Hydrate Research Program

• Resource Characterization

• Resource Development Modeling and Technology

GOVERNMENT

INDUSTRY UNIVERSITY

Methane Hydrate Research Methane Hydrate Research Alignment and InteractionAlignment and Interaction

U.S. Department of Energy

3D Seismic& Well Data,Infrastructure

Research/Expertise

ResearchInnovation

ResourceEvaluation

UnconventionalResource

Determination

Collaborative ResearchCollaborative Research

• Industry-Focused Project Funding•Encourages Industry Collaboration

• Enables Methane Hydrate Project Research

•Ensures Research Fit-for-Purpose• Enables Long-Term Value

•Supports Industry & Government Goals• Enables Resource Decisions and Planning

• Industry – Academic Research Alignment• Research Topic Important to Both • Industry Not Inclined to Self-Perform• Industry-Directed Research Programs• Industry Expectations Clear• Industry-focused Research Results

Alaska Gas Ken Konrad

Gas HydrateProject Manager Robert Hunter

USGS LeadGas Hydrates

Timothy Collett

UAF PIEngineering Shirish Patil

UA PI Geoscience

Robert CasavantUSGS

Geophysics David Taylor

USGSGeophysics Myung Lee

Co-PIGeoscience

Mary Poulton

Co-PIGeophysics Roy Johnson

Lawrence-Berkeley

Pacific Northwest Pete McGrail (PNNL)Tao Zhu (UAF)CO2 Injection

LBNL LeadReservoir Model George Moridis

Arctic Energy UAF-DOE

National Laboratory Collaborative Projects

GOVERNMENT INDUSTRY UNIVERSITIES

Co-PIGeoscience

Charles Glass

Consultant to UAGeoscienceKen Mallon

ParticipatingScientist

S. Khataniar

Co-PIAbhijit Dandekar

ParticipatingScientist

Godwin ChukwuParticipating

ScientistDavid Ogbe

ParticipatingScientist

Doug Reynolds

Methane Hydrate Program Methane Hydrate Program Collaborative Research TeamCollaborative Research Team

ArgonneArun Wagh (ANL)

Ceramicrete Cement

Technical Advisor Scott Digert

Methane Hydrate Resource Methane Hydrate Resource --Potential to Fill Projected Gap?Potential to Fill Projected Gap?

Options to Increase Gas SupplyOptions to Increase Gas Supply

• Open Exploration/Production Areas• Increase LNG Imports• Develop Unconventional Resources

• Coalbed Methane• Deep Gas• Shale Gas• Gas Hydrate

•Best Gas Storage Capacity•Technically and Economically Challenging HEI

Unconventional Gas Resources Unconventional Gas Resources Gas Storage Capacity ContrastGas Storage Capacity Contrast

05

101520253035404550

In-Place Gas Per Cubic Foot,30% Porosity Reservoir

Gas Hydrate

Coal BedMethaneTight Sands

Devonian Shale

Geo-PressuredAquifers

After National Petroleum Council, 1992

Methane Hydrate ResourceMethane Hydrate ResourcePetroleum System ComponentsPetroleum System Components• Source – Thermogenic - Biogenic

• Migration – Fault Systems

• Reservoir – Sub-PermafrostShallow Sands

• Trap – Complex Structural andStratigraphic through 4D

• Seal – Can Self-Seal

• Stability – Pressure/Temperature

• Gas/Water – Clathrate Structure

Gas Hydrate Resource and Gas Hydrate Resource and Prospect RequirementsProspect Requirements

• Petroleum System Components• Industry Infrastructure • Industry Acreage Access• Production Technology (Familiar)• Economics and Risk Assessment

• Ultimate Recovery Potential?• Daily Production Rate?• Operating Cost?• Profitability?

• Research Support in Aligned Areas: Gulf of Mexico and Alaska

HEI

Alaska Gas Owners

ExxonMobil

ConocoPhillips

StateOthers

BPØNorth Slope Proven Gas = 35 TCF

ØPrudhoe Bay 8 BCF/Day Production

ØReinjected Gas Reservoir Energy

Alaska North Slope (ANS) Alaska North Slope (ANS) Development InfrastructureDevelopment Infrastructure

Miles

0 5 10 15 20 25

TAPS

Northstar

PBUKRU

MPU

NPRA

ANWR

Coastal Plain(1002 Area)

LJL (April, 1997)

Pt. ThomsonLiberty

Badami

Colvi

lle R

iver

Developments

Discoveries

Tarn

(Eileen)Alpine

Endicott

Location Map

Present-Day SurfaceNORTH

ANS Schematic CrossANS Schematic Cross--SectionSection

BROOKS RANGE

ELLESMERIAN BEAUFORTIAN BROOKIAN

WEST SAK/UGNU

ENDICOTT

PT. MCINTYRE/NIAKUK

PRUDHOELISBURNE

ALPINE

TARN

GAS HYDRATE

KUPARUK/MILNE PT

PERMAFROST

ANS Methane Hydrate ANS Methane Hydrate Estimated InEstimated In--Place ResourcePlace Resource

FREE GAS?

PBU26%

KRU39%

MPU100%

DIU

EILEEN TREND

44 TCF

60 TCF?

GAS HYDRATE& FREE GAS

GAS HYDRATE(After Collett, 1993)TARN TREND

TARNTREND

Alaska Gas Hydrate Resource Alaska Gas Hydrate Resource Methane Hydrate Stability FieldMethane Hydrate Stability Field

EILEENTREND

300

0(m) (ft)

0

1000

(psi)0

500

1000

1500

2000

2500

0

4

8

12

16

-10 0 10 20 30TEMPERATURE (°C)

DE

PT

H

PR

ES

SU

RE

(MP

a)

Base ofice-bearingPermafrost

Geothermalgradient G

as h

ydra

te s

tab

ility

fiel

d

Modified After Collett, 1993

MethaneHydrate

Rock/Sediment

Free Gas

600

900

2000

3000

40001200

Alaska Gas Hydrate Resource Alaska Gas Hydrate Resource Historical ANS PerspectiveHistorical ANS Perspective

YearInitial ANS Exploration

NW Eileen #2 Gas Hydrate Test Well

Prudhoe Bay Field Discovery

USGS Research ProjectsUSDOE Gas Hydrate ProjectsBP EWE Seismic Study

USGS Resource Assessment – 590 TCFARCO Gas/Hydrate Study

USDOE-BP Gas Hydrate Project

Possible Pilot Development

1960

1970

1980

1990

2010

Oil-Focus Research Gap

2000

Year/Phase/DOE Cost

BP BP –– DOE Gas Hydrate ProjectDOE Gas Hydrate Project

2001

2002

2003

2004

2005

2006

I $2.0

II $3.6

III $7.6

Project ProposalDOE-Industry Alignment

Drilling/Production RE/PE Studies

Wells of Opportunity – Acquire Data

Reservoir and Economic Modeling

Production Test, Reserves Calc.

Possible Pilot Development

Reservoir and Economic Modeling

Characterize Reservoir/FluidVerify In-Place Resource

• Interpret 3D Seismic and Well Data• Characterize Reservoirs and Fluids • Seek Sizable, >Continuous Resource • Collect Data in Opportunity Wells• Model Gas – Gas Hydrate Reservoir• Evaluate Development Scenarios• Design Drilling, Completions,

Production Technology• Decide Phase II Progression-Activities• Select Candidate Operations Area(s)

Phase I: Assess/Phase I: Assess/Aquire Aquire Data, Data, Determine Resource PotentialDetermine Resource Potential

BPXA BPXA –– DOE Gas Hydrate ProjectDOE Gas Hydrate ProjectComponents and CollaborationsComponents and Collaborations

• Gas Hydrate Productivity Studies: UAF, LBNL, PNNL, ANL• Control Gas Hydrate Stability • Assess Drilling/Completion/Production Ops• Model Thermodynamics – Productivity• Develop Production Scenarios/Technology

• Resource Characterization Studies: UA, USGS, BPXA• Assess Shallow Conventional 3D Seismic• Evaluate Fluid Acoustic Properties• Incorporate and Acquire Well Data

ReservoirReservoir--Fluid CharacterizationFluid CharacterizationGas/Hydrate InGas/Hydrate In--Place CalculationPlace Calculation

3D Seismic / Well Data Interpretations

• Stacked Fluvial-Deltaic / Marine Sands• Disrupted Reservoir Continuity/Quality

• Facies, Fluid, & Reservoir Heterogeneity

• Intraformational Unconformities• Fault Compartmentalization

Geophysical CharacterizationGeophysical CharacterizationReservoirs and FluidsReservoirs and Fluids

Possible Gas Hydrate

Possible Free Gas

Polarity Reversal

Trapping Fault

Tim

e

Milne Milne Point 3D Seismic LinePoint 3D Seismic LineGas Migration: Fault ConduitsGas Migration: Fault Conduits

Courtesy USGS

MPU 3D Seismic Waveform Class MPU 3D Seismic Waveform Class PotentialPotential FaciesFacies & Fluid Identifier& Fluid Identifier

40ms Window,USGS Zone C

Petroleum and Reservoir Petroleum and Reservoir Engineering ResearchEngineering Research

Phase Behavior

Reservoir & Economic Modeling(UAF-BPXALBNL-RS)

3 miles2 m

iles

95ft

Methane Hydrate

Free Gas

Water

Eileen Trend

Tarn Trend

Free Gas

Petroleum and Reservoir Petroleum and Reservoir Engineering ResearchEngineering Research

Drilling, Completionand Production Studies(UAF, ANL, others)

CO2 to Enhance CH4 Recovery(UAF-PNNL)

Relative Permeability(UAF, LBNL)

Preliminary Reservoir ModelPreliminary Reservoir Model(LBNL(LBNL--BPXABPXA--USGSUSGS--UAFUAF--RS)RS)

3 miles

2 miles

95ft

Methane Hydrate

Free Gas

Water

Sagavanirktok Fm, Unit C

5 wells, centered in Free Gas area

Ø Calculate Recovery FactorsØ Develop Production Scenarios

Preliminary Reservoir Model Preliminary Reservoir Model Gas Hydrate DissociationGas Hydrate Dissociation

Components of Reservoir Voidage

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

1 3 5 7 9 11 13 15 17 19

Years

Gas

Rat

e, M

MS

CF

/D

Reservoir Free Gas Hydrate Dissociation

Cum Gp vs Time

0

100000

200000

300000

400000

500000

600000

700000

0.0 5.0 10.0 15.0 20.0

Y e a r s

Free Gas Only Plus LBNL Eq Hydrates

Free Gas GIIP

ØSignificant Production Increase due toFree Gas Dissociation from Gas HydrateØSignificant Uncertainties: Use with Caution

Productivity Challenges Productivity Challenges Gas Hydrate Production MethodsGas Hydrate Production Methods

Methanolor CO2

Dissociated

Thermal Injection

Gas Out

Imperm. Rock

Impermeable Rock

Gas Hydrate

Inhibitor or CO2Injection

Gas Out

Imperm. Rock

Impermeable Rock

Depressurization

Free-Gas

Gas Out

Gas Hydrate

Hydrate

Reservoir Dissociated HydrateDissociated Hydrate

Imperm. Rock

Hot Brine

or Gas

Gas Hydrate

After Collett, 2000

Ø Endothermic heat of dissociation

Ø Temperature recovery lag time

Ø Hydrate self-preservation

Ø Large energy in Ø Heats Host RockØ Possible in-situ

Electromagnetic

Ø High costØ PNNL Lab TestingØ Unk. Effectiveness

Proof-of-Principle CH4 → CO2

ProofProof--ofof--Principle Principle CH4 CH4 →→ CO2CO2

• Temperature Reading Immediately Spiked from -2.5°C to 8°C

• Collected Gas Samples Displayed Strong Methane Peaks with Small to No CO2 Peaks on GC Analysis

• Thermodynamically Favorable• Offsetting Dissociation Enthalpy: Heat of

formation for CO2 hydrate ~20% larger than CH4 hydrate heat of dissociation

• Reforming CO2 Hydrate Mechanically Stabilizes Hydrate-Bearing Sediments

Theory: Inject CO2 to Recover CH4 from Gas Hydrate

Results: CH4 from Gas Hydrate by Injecting CO2

• Short-Term: 4-5/7üDetermine Physical/Chemical Propertiesü Input Research to Databases and Websiteü Improve Distribution/Volume Assessmentü Improve Geophysical Characterization ToolsüProvide Samples and Use Sampling Tools

• Mid-Term: 3/3üRefine Characterization ToolsüEstimate Recovery PotentialüDevelop/Test Production Methods

• Long-Term: 3/4üEconomically Produce for Secure Gas SupplyüProvide Knowledge/Tools Supporting R & DüLeader in Gas Hydrate R & D

Interagency Gas Hydrate R & D Interagency Gas Hydrate R & D Objectives Attainable in AlaskaObjectives Attainable in Alaska

BP Alaska Gas Hydrate BP Alaska Gas Hydrate Project SummaryProject Summary

• Alaska North Slope: Premier Area/Time• Resource – Infrastructure – Alignment

• Characterize and Quantify Resource• Determine Production and Economic

Resource Potential• Develop Drilling, Completion, Production

Technology• Benefit Industry and Government

• Assess Technical/Economic Hurdles• Convert Potential Resource into Reserves• Develop Huge/Unconventional Resource• Use Gas for Reservoir Energy &/or Sales