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DOE to award up to $35M for environmentally-prudent unconventional resource development

4 May 2014

The US Department of Energy (DOE) has issued a funding opportunity announcement (DE-FOA-0001076) for projects in Fiscal Year 2014 (FY2014) that focus on improving the environmental performance of unconventional oil and natural gas (UOG)—i.e., shale gas, tight oil, and tight gas—resource development. DOE expects approximately $25-35 million to be available for new awards under the FOA.

While in-place, unconventional resources are substantial, recovery efficiencies are commonly low in these reservoirs. Current industry practice includes decreasing well and frac stage spacing to increase overall recovery. The objective of the new FOA is to address critical gaps of knowledge of the characterization, basic subsurface science, and completion/stimulation strategies of tight oil, tight gas, and shale gas resources to enable more efficient resource recovery from fewer and less environmentally impactful wells.

DOE is considering two primary topic areas under the FOA: following Topic Areas are being considered: Field Validation using Dedicated Research Well(s) and/or Wells of Opportunity; and Prudent Shale Development.

Topic Area 1 – Field Validation using Dedicated Research Well(s) and/or Wells of Opportunity. Field validation of new knowledge or technology development is vital for understanding the nature of resource recovery as well as the cumulative environmental implications of UOG development.

While industry often provides opportunities for researchers to gather data and test new concepts, the timing, location, and other factors often preclude the ideal testing conditions, DOE notes. An alternative is to obtain a well(s) the applicant utilizes, as a dedicated research well or as a research well of opportunity to enable an open, collaborative, and integrated program of science and technology development/testing.

DOE is looking for applicants who will provide access to a well or development site and propose initial plans for scientific testing (subject to review and approval by DOE) that will allow for the collection of samples and data, and/or the testing and demonstration of advanced technologies. Research areas of specific interest for dedicated research wells may include, but are not limited to:

  • Assurance of long-term borehole integrity as well as isolation of production zones from overlying sources of drinking water via natural or other migration pathways.

  • Characterization of petrophysical, geological, geochemical, and microbiological conditions of reservoir rock and seals before, during, and after reservoir stimulation.

  • Demonstration of technologies for improved characterization/visualization of reservoir conditions, fracture development and propagation, fluid emplacement, reservoir response, and stimulated rock volume.

  • Baseline and real-time monitoring of the environmental impact on land, air, water, and communities as well as demonstration of mitigative technologies.

  • Testing and demonstration of new technologies and/or scientific insights that can lead to new approaches that can enable dramatic improvements in drainage radius and recovery efficiency.

  • Demonstration of the effectiveness of emerging environmental impact-mitigation technologies that have been developed with support of the DOE.

Topic Area 2 – Prudent Shale Development The environmental impacts of UOG development—particularly the cumulative and long-term impacts—remain poorly constrained, DOE said. In addition, current industry practice designed to increase recovery efficiency include approaches that have the potential to increase the overall environmental impact of development through significant increases in development intensity.

DOE is requesting applications designed to provide the science and technology to both minimize environmental impacts and improve the efficiency of UOG development.

DOE uses “efficiency” to refer to approaches that can increase primary recovery without increased well density or that can otherwise enable improved recovery from fewer and less-impactful wells.

Projects proposed under Topic Area 2 may include focused experimental, numerical simulation, and/or technology development activities related to any of the topics listed below; however, each project must include a field data collection, validation, and/or demonstration phase to be considered responsive.

Research areas of specific interest under this topic area include, but are not limited to the following critical gaps of knowledge of the characterization, basic subsurface science, and completion/stimulation strategies that will enable recovery from fewer and less environmentally-impactful wells.

  • Development of science and technology related to the assurance of the long-term integrity of boreholes.

  • Demonstration of technologies for improved characterization/visualization of fracture development, fluid emplacement, gas and fluid flow, and stimulated rock volume between and within wells.

  • Demonstration of technologies for the effective monitoring and mitigation of impacts to surface and groundwater resources, ambient air quality/impact, as well as other ecological impacts.

  • Development, validation, and demonstration of affordable non-water-based and non co2-based stimulation technologies, which can be used instead of, or in tandem with, water-based hydraulic fracturing to reduce water usage and volume of flowback fluids.

  • Testing and demonstration of new technologies, field development strategies, and/or scientific insights that can lead to new approaches that can enable dramatic improvements in per-well drainage radius and recovery efficiency, including the effects of water injection on reservoir petrophysics and the evaluation of the optimal use of stimulation fluids.

  • Development of reservoir characterization and interpretation technologies that enable improved prospect delineation and pre-drill assessment of geologic features to reduce the number of non-productive wells drilled, minimize the unproductive injection of hydraulic fracturing fluids, and to delineate subsurface zones that should not be developed due to enhanced risk for unwanted fluid migration.

DOE anticipates making 6 to twelve 12 awards under this announcement depending on the size of the awards. DOE anticipates making 1 to 2 awards for Topic Area 1 and 5 to 10 awards for Topic Area 2. Cost share must be at least 20%.

May 4, 2014 in Natural Gas, Oil | Permalink | Comments (7) | TrackBack (0)

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Comments

If they would just run their rigs using flare gas in North Dakota it would help. You can see the flaring from space, people in national parks can not see the stars from the flaring light pollution.

This probably anticipates two things. One, the higher concentration per square mile of pipelines in fracked fields. Harold Hamm hopes that the Bakken alone wil yield 35 bbl in this manner. Second,the justified recovery of propane, which in jellied form, is a promising frack fluid. That will greatly help the flare situation.If it all works, we will see viable fields in tiny, out of the way places, like former Pennsylvania stakes.

One company is working on a way to power pumps with flare gas. This could and should have been done long ago, but when something is cheap it gets wasted.

SJC, I developed a very preliminary business plan for portable/relocatable power generation fueled by otherwise flared effluent. I made some fairly conservative assumptions about capital costs (liquids separation, etc.) and it seemed pretty close to being viable as a seller of turnkey power-by-the-hour. You would think that somebody with modest E&P familiarity, a power generation portfolio, and a financing arm could make a business of this. I'm thinking GE Oil and Gas.

Anyhow I think you're right. It breaks my heart to see the Bakken fields looking just like the Odessa Permian when I was a kid in the 1960's and the Texas Railroad Commission essentially set the world price of oil at $10/bbl.

TSK Tsk Herman! You accuse me in the blog on autonomous driving of ignorant populist understanding of patent law. Now you make an aside that the Texas Railroad Commission is some evil capitalist trade bloc. Sorry, you can't blame them for the economics of gas and oil. Crack a book on the history of petroleum and you will find out just how little power private trade restraint has on the business. Our federal government (the one that protects fair trade?) is another story.

We can continue this conversation in the other blog.

kalenjay, TRC still exists, but hasn't been a player in setting the price of oil since the early 1970's. The global playing field dwarfs US companies and regulatory authorities. My reference is to decades past. Don't know how you would see the statement "when I was a kid in the 1960's" as anything but a reference to a time before there was an internet (yes, even then).

"The history of petroleum"... Try this one on: when I was 16 and got my drivers license, I was a runner for Mr. Behr and his secretary/girlfriend who made a fortune fraudulently turning old oil into new oil in 1973. (BTW, even I had forgotten the price -- more like $5.) I didn't really understand what they were doing, and I skipped school often to do "errands", but they disappeared to Mexico after buying me a new Yamaha RD350, which made me the King of Gilmer, TX. By then the TRC was already a relic in terms of price setting (but remains, as I understand it, a significant power structure in TX government --- haven't lived there for many years except on TDY).

Capstone Turbine has been selling turbines to run on flare gas to power production equipment, pumps and compressors in the fields but not enough. Buried direct current power lines can be installed cheaply to take power from more turbines to a convertor at a grid interface. Direct current Norwegian hydro-power was sent 30 Kilometers under water to run compressors on a production platform to save on CO2 release costs. Such turbine power can also be used to convert methane to LNG in tanks until tanker can pick them up. StirLNG, Netherlands, liquifiers can be used for small production and continuous cooling of tanks. Foam glass can insulate the smallest and largest, of tanks. Propane, butane and ethane can be separated and stored in pressure tanks without continuous cooling. Years ago an attempt was made to get Philips Stirling to make a combined machine that had a Stirling engine power a Stirling refrigerator directly. A cooler was built in Japan on this premiss. Perhaps the cheapest combination is an INNAS NOAX engine operating a Stirling piston or a ionic liquid compressor for a LINDE cycle liquifier and or CNG storage. COATS LIMITED makes natural gas engines with rotating valves and these or others could be coupled instead of the electric motor of the StirLNG cooler for very low development and operating costs. ..HG..

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