|The proposed Shell-Statoil CO2-EOR project. Click to enlarge.|
Shell and Statoil have signed an agreement to work towards developing the world’s largest project to date using carbon dioxide (CO2) for enhanced oil recovery (EOR) offshore. The concept involves capturing CO2 from power generation and injecting it in into offshore oil fields to enhance oil recovery, resulting in increased energy production with lower CO2 impact.
The project could potentially store approximately 2 to 2.5 million tonnes of CO2 annually in two different fields.
The project will be based on an 860 MW gas-fired power plant and methanol production facility at Tjeldbergodden in Mid-Norway. The plant will be fueled by gas from offshore fields. In turn, it will capture and provide CO2 back to the Draugen and Heidrun offshore oil and gas fields. Power from the plant will serve mid-Norway, and also be provided to the offshore fields, enabling near zero CO2 and oxides of nitrogen oxide (NOx) emissions from these installations.
The various elements of the project will be phased in during the period 2010-2012. Establishing this CO2 value chain is, according to the panters, technologically and commercially challenging. Hence:
The project will hence depend on a substantial Government funding and involvement. The project will rely on the involvement of industrial stakeholders and electricity users in the region.—Shell and Statoil statement
Shell began working with CO2 for EOR in the 1970s. Statoil is a pioneer in CO2 storage through Sleipner in the North Sea, Snøhvit in the Barents Sea and In Salah in Algeria.
The US Department of Energy recently released a series of reports claiming that the development of new carbon-dioxide capture and injection technologies for Enhanced Oil Recovery could more than quadruple US domestic oil production. (Earlier post.)
Statoil and Shell coincidentally announced their CO2-EOR partnership on 8 March 2006: the 50th anniversary of the speech given in San Antonio, Texas, by a Shell employee, M. King Hubbert. In that speech, Hubbert predicted that US oil production would start to decline by the early 1970s (which it did). That speech marked the beginning of the still ongoing and contentious debate over the finiteness of the global oil supply.
Norwegian oil production in the North Sea has peaked and begun its decline, dropping down 11% to around 2.5 million barrels per day in 2005 from 2.8 mbpd in 2004. (Earlier post.)
The Draugen oil field in the North Sea, one of the participating fields in the CO2-EOR project, was discovered in 1984. Its oil production peaked in 1999, according to figures from the Norwegian Petroleum Directorate, at an average 209,000 barrels per day. By 2005, that had dropped to an average of 104,000 barrels per day.
The operators currently use water injection to maintain pressure in the field. Water production from the field—which was zero in the peak year of 1999 increased to 103,000 barrels per day in 2005—a composite water cut of about 50%.
Heidrun was discovered in 1985 and peaked in 1997 with an average production of 231,000 barrels per day; production in 2005 was an average 140,000 barrels per day. Water injection began in 2000, and in 2005, the field produced an average of 79,000 barrels of water per day, for an average composite water cut of 36%.