A warming climate for enhanced oil recovery

Climate change agreements, high oil prices and new research mean that carbon dioxide capture and storage and its use is expected to be particularly relevant for several Middle East producers, writes David Andrews

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By  O&GME Staff Published  March 2, 2006

technology|~|Technology1TimBoyle200.gif|~||~|The increase in carbon dioxide (CO2) emissions over recent decades is viewed as one of the greatest factors contributing to global warming, and a reduction in the amount of this type of greenhouse gas being released into the atmosphere is the main aim of climate change global agreements such as the Kyoto Protocol.

Now the storage of CO2 in underground geological formations is one of three measures being promoted to address global warming. The others are reduced energy consumption and using fuels that produce less CO2. Depleted oil and gas fields, unexploited coal seams and deep saline aquifers are all ideal for CO2 sequestration.

Already there are projects in several countries for CO2 storage in oil and gas fields, including Sonatrach/BP at In Salah in Algeria, Statoil at Sleipner and Snøhvit in Norway and ChevronTexaco with Gorgon in Australia.

For energy producers, injecting CO2 can also facilitate enhanced oil recovery (EOR). Under this process, CO2 is injected into the reservoir via wells in order to reduce the viscosity of the trapped oil so that it flows more easily. Water is injected in alternating cycles with CO2 to sweep oil to the producing wells that pump it, along with CO2, produced water and any associated natural gas to the surface. Then, the CO2 and the associated natural gas are separated and taken away for additional processing. Natural gas liquids are extracted, and the CO2 is re-injected while the oil and produced water are separated at a central tank battery, and the oil is then piped to holding tanks.

This technology is by no means new; in fact, it has been practiced for some time in the US and Canada, notably in the West Texas Permian where this form of EOR accounts for 20% of the region’s total oil production.

There are several reasons why CO2 capture and storage (CCS), both on its own and for EOR purposes, have not become more widespread. As well as safety concerns, these include the fact that CO2 capture costs can be high, and, in the case of EOR, CO2 injection is costly at lower oil prices; however, today’s higher oil prices have made it a much more attractive proposition.

There are also some new groundbreaking R&D projects underway, most importantly, at the Weyburn oilfield in the Williton Basin, southeast Saskatchewan, Canada. In 2000, Canadian oil firm EnCana began injecting significant amounts of CO2 into the field -- first discovered in 1954 -- to boost oil production.

The first C$40-million, four-year phase of this project has been very successful. “It’s shown us that the reservoir we chose for EOR and CO2 storage is competent and capable of storage,” says Mike Monea, executive director of Canada’s Petroleum Technology Research Centre (PTRC), which conducted the study.

“The EOR exceeded our expectations, and it was very efficient, and the flood mechanism worked perfectly.” The Weyburn field with its 500 wells, Monea admits, “should have been dead by now.” Production from each well was averaging just five to six barrels per day, however, following CO2 injection, this rose in some cases to 1,000 barrels per day. Now, PTRC expects 160 million barrels of crude will ultimately be recovered.

Monea says the success was due to a very thorough preparation of the science involved, including “base-lining all kinds of technologies, geological and geochemical, well bore evaluation and shooting lots of 3D seismic.” The data already acquired is expected to prove invaluable for any company interested in a similar project. “The work we are doing here and our studies of the life-cycle of CO2 can be applied to any reservoir around the world; we already know that [Saudi] Aramco is very interested in getting involved, and we hope that will give a window on the potential in the Middle East’s industries”

A second phase is planned, and PTRC is working on regulation, policy and communication procedures that it hopes governments will adopt to set up their own CO2 injection projects. Monea says it also wants to include data from other projects to create a database so that an interested party can assess whether a particular reservoir could support an EOR project.

PTRC is also working with Schlumberger on new logging techniques and with Halliburton on special cements and casings. “We need to do more work on reservoir simulation and study the well bore in more detail, as we feel this is where the CO2 would be most likely to leak in the future. We also need to design new casings to withstand injection pressure and also the acidity that’s created during the injection process.”

With a large part of the funding for Weyburn coming from oil companies, interest in CO2/EOR applications is obviously high. “Incremental oil and gas production using this technology is very attractive to the oil majors at present,” says John Gale, communications manager for the International Energy Agency’s (IEA) Greenhouse Gas R&D Programme, based in the United Kingdom.

However, he is still cautious about the long-term outlook. The IEA has estimated that oil and gas fields will need to be taking up to 40% or even 50% of all global CO2 storage sector in order to have a major impact on climate change, and the cost of CCS still needs to fall for it to become more financially attractive.

Gale also points out that CO2 transportation remains a problem, and that the ideal scenario is where it is sourced from a power station close to an oilfield to reduce costs, as well as for safety reasons. One-third of all CO2 emissions due to human activity come from fossil fuel used in electricity generation. “The power sector needs to drive this forward; the cost of capture and storage need to come down,” Gale says.
But he says that there is “considerable” interest in EOR from oil and gas producers particularly in the Middle East. Here, companies including Saudi Aramco and Qatar Petroleum have been involved in R&D work, and the Abu Dhabi National Oil Company (ADNOC) has carried out a CO2 injection study in the western area of the Upper Zakum field “as part of its long-term strategy to enhance oil recovery by injecting CO2 into oil reservoirs,” the state-owned firm says.

Further proof of the potential in the Middle East came in December via a Shell EP International and Mitsubishi Heavy Industries regional, strategic alliance to explore “business opportunities relating to CO2 capture and recovery.” This will include EOR projects to improve oil flow and recovery rates from developed reservoirs. Any project promoted by the two companies would use Mitsubishi’s flue-gas CO2 recovery technology, known as the Kansai-Mitsubishi proprietary CO2 recovery process, based on a chemical process that separates and absorbs the CO2.

“Shell has inventorised CO2-EOR opportunities in the Middle East, and we believe CO2 sequestration is a great opportunity for countries in the region,” says Nejib Zaafrani, Shell vice-president Strategic Alliance, Middle East, Caspian, South Asia. “We are actively pursuing economic ways to capture CO2 from our existing and future operations.”

The agreement with Mitsubishi lasts for two years, but may be renewed by mutual agreement for a further period. Zaafrani adds, “There are increasing concerns worldwide about the security of oil supply in the future, as well as the effects of global climate change…. Projects that involve CO2 capture linked to EOR projects are unique in being able to address both concerns at the same time…. The capture and use of CO2 contributes to the abatement of carbon emissions and the increase of a more efficient use of energy in upstream operations.”

But it’s not just the emissions angle that interests Shell. High oil prices are helping reduce costs related to CO2/EOR technology: “In reservoirs that are suitable for CO2 EOR, we believe that at current oil prices, the potential revenues of incremental recovery greatly exceed the associated costs of CO2 capture and injection…. CO2 EOR is a tremendous opportunity to enhance the lifetime of some of the giant reservoirs in the Middle East,” says Zaafrani.

Any projects Shell launches may also benefit Petroleum Development Oman (PDO), in which it is not only a shareholder but also acts as technical advisor. According to Jan van Buitenen, PDO’s EOR director, the company is “certainly interested in CO2 as a means by which to improve oil recovery from our fields.” He says that carbon dioxide could possibly replace a hydrocarbon gas as an oil solvent in a miscible-gas EOR project such as the one PDO is carrying out at Harweel.

Van Buitenen adds, “Because hydrocarbon gases are currently extremely marketable, carbon dioxide becomes an attractive substitute. But in none of the EOR schemes that we have investigated can we fully replace the requirement for hydrocarbons. In the end, whether or not PDO captures or stores carbon dioxide will depend on the economics of the project, taking into consideration the environmental benefits as well.”
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