2005 Results and Overview2005 Results and Overview

GCCC Staff at the Bureau of Economic Geology, Jackson School Of Geosciences, The University of Texas at Austin

December 14, 2005

Gulf Coast Carbon Center (GCCC)Gulf Coast Carbon Center (GCCC)

Mission: A global leadership position in economic implementation of large scale greenhouse gas sequestration.

Sponsors

GCCC Staff at Bureau of Economic GeologyIan Duncan, Bill Ambrose, Susan Hovorka, Mark H. Holtz, Shinchi Sakurai,

Joseph Yeh, Khaled Foaud, Jeff Paine, Becky Smyth, Cari BretonMike Moore, Falcon Environmental; Michelle Foss, Center for Energy Economics

Other GCCC CollaboratorsOther GCCC Collaborators

• DOE-NETL – Frio project• Southeast Regional Sequestration Partnership

(SECarb); Southwest Regional Sequestration Partnership

• Environmental research, NGO’s– Environmental Defense, National Resources Defense

Council Houston Sierra Club• Other research teams

– National labs, NETL, LBNL,LLNL, ORNL, PNL; USGS; Institute for Energy, Law & Enterprise; HARC; UT ESI; Louisiana Geological Survey, Australian CO2CRC

• Mike Moore (Falcon Environmental)– GCCC consultant with power industry

GCCC ActivitiesGCCC Activities

• Source-Sink Inventory• Field Demonstrations

– Permian historic field impact study– Permian new field evaluation– Gulf Coast stacked storage – Frio Brine Pilot Experiment

• Risk Assessment• Carbon trading workshop• Public information• Information to Texas Legislature (and other Gulf

Coast States)

Source- Sink inventory: US Source- Sink inventory: US Distribution of CODistribution of CO22 Sources and Sources and

Subsurface SinksSubsurface Sinks

CO2 Data from IEA Greenhouse Gas databaseThickness of sedimentary cover from USGS Sources of CO2 gridded and summed and thickness

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Results at www.gulfcoastcarbon.org

Message to LegislaturesMessage to Legislatures

Energy supply benefits from applying CO2 enhanced

oil recovery processes in Texas and the Gulf Coast.

The Environment benefits from capturing and storing a major greenhouse gas.

The Economy benefits from• Enhanced oil recovery (EOR) including wellhead

value, taxes, and jobs. • Net positive carbon credits in Texas and the Gulf

Coast owing to large volume storage capacity• Jobs created by infrastructure development

associated with a CO2 sequestration industry

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Saline Formations

Focus on the Gulf CoastFocus on the Gulf Coast#

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Ozone nonattainment

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Sources (dot size =release) Refineries and chemical

plants Electric power plants

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Selected oil fieldthat could benefit from EOR

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Existing CO2

pipeline

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Future CO2 pipeline

Frio Brine Pilot

Pipelines and Areas of InterestPipelines and Areas of Interest

Courtesy of AirLiquide

Economic Framework for Gulf Economic Framework for Gulf Coast COCoast CO22 Source-Sink Integration Source-Sink Integration

• Numerous sources including immediately available CO2 from refineries and chemical plants and large amounts of CO2 available from power plants at the time that technologies mature.

• Numerous oil and gas fields in decline provide market for CO2

• Determine price of CO2 under various configurations of sources, pipelines, and technology breakthroughs, and incentives.

• Identify early opportunities for successful implementation

Oil & Gas ReservoirsOil & Gas Reservoirs(Texas)(Texas)

DECISION TREEFOR SCREENING

CANDIDATERESERVOIRS

Oil-reservoir database

Has reservoirbeen waterflooded?

Minimummiscibility

pressure (depth,temp., pressure,

oil character)

Does reservoir havewater- drivemechanism?

No

Rejected

No

Rejected

No

Rejected

No

Yes

Unknown

Yes

Yes

Yes

No

Candidate reservoirs

Candidate forsecondaryrecovery

Reservoir depth> 6000 ft

Cumulativeproduction> 1 MMSTB

Yes

Oil Reservoir Candidate ScreeningOil Reservoir Candidate Screening

• Oil reservoir database developed for Texas– Total of 3,266 reservoirs

• Applied screening criteria for 3 countiesBrazoria, Galveston, and Orange CountiesCandidate reservoirs lie in 5 geologic plays

Piercement Salt-DomeFrio Deep-Seated Salt DomesFrio (Buna) Barrier/Strandplain SSFrio Barrier/Strandplain SSHackberry Submarine-Fan SS

• 44 initial candidate reservoirs

Net sand in brine formation

Oil and gas fields, play outlines

Refineries, chemical plants

Coal-fired power plants

Gas and oil -fired power plants

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100 0 100 200 Miles

Source-Sink OpportunitiesSource-Sink OpportunitiesExplored in GISExplored in GIS

Existing CO2 pipeline

Oil fields - benefit from EOR

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Recovery Efficiency of Sandstone Reservoirs from Enhanced Oil Recovery Efficiency of Sandstone Reservoirs from Enhanced Oil Recovery ProjectsRecovery Projects

Fre

qu

enc

y

Recovery efficiency (percent)

Submarine fan

Barrier/strandplain

Fluvial/deltaic

QAc4237c

0

2

3

4

0 6 12 18 24 30 36 42

1

5

6

7

West Texas COWest Texas CO22 Market Market• Company- KinderMorgan

• # reservoirs – app. 70• Additions usage-• 1,500 miles of major

pipelines• Approximately 7.3 TCF or

380 MM tones used

Mississippi COMississippi CO22 Market Market

Simplified Model Using Dimensionless Simplified Model Using Dimensionless Groups for Rapid Assessment of COGroups for Rapid Assessment of CO22

Flooding and Storage in Gulf Coast Flooding and Storage in Gulf Coast ReservoirsReservoirs

• Model can be applied to candidate Gulf Coast reservoirs in BEG database – limited data on many reservoirs

• Potential for use by small and big operators alike to quickly identify best reservoirs

CO2 Injection and Production

0.00E+00

1.00E+09

2.00E+09

3.00E+09

4.00E+09

0 25 50 75 100 125

Time (days)V

olu

me

(SC

F)

Injected

Produced

Derek Wood, Larry Lake

Texas COTexas CO22 EOR Resource Target at EOR Resource Target at

15 % Recovery15 % Recovery

2,037,000

307,6941,965,856

1,445,550

Gulf Coast

Texas Cretaceous Shelf Margin

East Texas

North Central Texas

0

100,000

200,000

300,000

400,000

500,000

600,000

Res

idua

l oil

(MST

B)

Gulf Coast residual oil target by play

Total = 5.7 billion STB

Additional Production from COAdditional Production from CO22 EOR EOR

98 89

1,500

3,027

4,714

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Oil

EO

R P

ote

nti

al (

Mill

ion

Bar

rels

)

Alabama Mississippi Louisiana Texas GulfCoast

Total

New Miscible CO2 EOR Potential

Role of Pilots in Evolution of CORole of Pilots in Evolution of CO22 Industry Industry

Extensive EOR and UIC experience

PilotsPilots

SACROC/ Claytonville

Stacked Storage

Denbury

Frio

SACROC/ ClaytonvilleSACROC/ Claytonville

• Co-operative with New Mexico Tech and Kinder Morgan

• SACROC – 30 years injection for EOR– Best practices – expansion to North area– Environmental impact on Groundwater

• Claytonville –Characterization for expansion into new production

Extensive Data In West Texas EORExtensive Data In West Texas EOR

• Show VRML of Fulterton• Charaterization of heterogenety,

remaining mobile oil optimizing engineering for secondary and tertiary recovery

• West Texas most mature providence over 1 billion STB produced by CO2 EOR

Model for Stacked Storage in the Gulf Model for Stacked Storage in the Gulf CoastCoast

Linked enhanced oil and gas productionto offset development cost and speed implementation

Very large volumestorage in stacked brineformations beneathreservoir footprints

Near-term and long-term sources and sinks linked in a regional pipeline network

Validation of adequacy of permitting and monitoring protocols

Prospective Source-Sink Matches for Prospective Source-Sink Matches for Stacked StorageStacked Storage

• Source – numerous Texas City refineries, Praxair hydrogen plant

• Sinks – two reservoirs; Smith Energy, Hunt Petroleum, capacity 4 million tons in stacked structural closures, excellent data

• 5-8 mile pipeline• Coastal lowland, stacked

sinks

Frio Pilot

Amoco Pipeline Access to Gillock Amoco Pipeline Access to Gillock FieldField

Gillock field

Gathering hub

To Texas City

Franks Production CharacteristicsFranks Production Characteristics

• OOIP- 16 million STB

• Cumulative production- 8 million STB

• Target EOR volume (15 % of OOIP)- 2.4 million STB

• Drive Mechanism- water drive

Franks Reservoir Geologic Franks Reservoir Geologic CharacteristicsCharacteristics

• Play- Frio Deep-seated Salt Domes

• Average Dip-Less then 2 degrees

• Reservoir Depth (ft)- 8,900 ft

• Net pay thickness- 11 ft

• Number of additional reservoirs- 3 oil

Potential Sources Near ProspectsPotential Sources Near Prospects

Company name CITYCO2

ESTIMATEYEAR

ESTIMATED CONCENTRATIONDuPont Orange 1290 2001 12%BP Amoco Texas City 4210 1999 3-13%Marathon Ashland Petroleum Texas City 694 1999 3-13%Valero Energy Texas City 193 2001 3-13%Valero Energy Texas City 1589 1999 3-13%Dow Chemical Texas City 1489 2001 12%BP Amoco Texas City 480 1999 100%BP Amoco Texas City 61 1999 100%

Ecosystem monitoring: Chemical and biologic changeGround water monitoring forgeochemical change

Injection horizon: pressure, temperature, oil and CO2 saturation during and post- injection, instrumented slant hole

Characterization of deeper horizon in preparation for eventualdisposal

Stacked Storage Monitoring ElementsStacked Storage Monitoring Elements

Research ElementsResearch Elements

• Demonstration in high emissions area with high injectivity

• Use of CO2 for EOR – economic demonstration• Assessment of impacts in of injection in high

water table – wetland setting• Monitoring across a fault and though reservoir to

measure CO2 movement, oil bank formation, pressure evolution, and fluid migration.

• Development of dual use of subsurface for EOR and for disposal

• Explore options for monitoring permanence at full implementation – define the gold standard for MMV

• Data to support risk assessment – Stress conditions during large injection– Displacement of brine– Impacts at surface – deformation and tilt

• Improved economic modeling – measure recovery efficiency for current technologies Gulf Coast case specific reservoir

• Dual permit for EOR + disposal

Technology Gaps – Stacked Technology Gaps – Stacked Storage Field Test ObjectivesStorage Field Test Objectives

Denbury as a Corporate ModelDenbury as a Corporate Model

• Added CO2 flood proved reserves of 35.3 MMBOE (12/31/03)– West Mallalieu field (2001) $ 4 million investment 10.4 MMBOE

proved reserves “$2.60/bbl cost”

– McComb Field (2002) $ 2.3 million investment 8.4 MM BOE proved reserves “$3.57/bbl cost”

• Little Creek, Ms 17% recovery– 1974 pilot

– 1985 2 phase project implemented

• 145 MMSCF/day CO2 used for EOR, 64 MMSCF/day sold commercially

CO2 EOR Processes Tested on the CO2 EOR Processes Tested on the Gulf CoastGulf Coast

• Water-alternating gas (WAG)– Example Quarantine Bay, Chevron 1991– Results 16.9% recovery of OOIP, 188 Mstb recovered– Design CO2 slug size 18.9 % of original HCPV, Miscible– CO2 utilization 2.57 Mcf/stb recovered

• Gravity stable flood– Example Weeks Island, Shell ( Johnston, 1988)– Results 64% of starting oil volume, 261 Mstb– Design 24 % pore-volume CO2 w/ 6 % CH4– CO2 utilization 7.9 Mcf/stb with recycle

CO2 EOR Processes Tested on the CO2 EOR Processes Tested on the Gulf CoastGulf Coast

• Huff ‘n’ Puff– Example 28 Texas projects (Haskin &Alston, 1989), 106 LA

and Kentucky wells (Thomas &Monger, 1991)– Results 3,233 to 29,830 stb/well– Design 2-3 week soak times 8 MMscf CO2 injected– CO2 Utilization 0.71 – 2.73 Mscf/stb, Average 1.3 Mscf/stb

Risk AssessmentRisk Assessment

Water tableUnderground source of drinking water

Earthquake

Escape to groundwater,surface water, or air via long flowpath

Substitute undergroundinjection for airrelease

Escape of CO2 or brine togroundwater,surface wateror air throughflaws in the seal

Failure of well cement orcasing resulting in leakage

Impacts of Unexpected Result of Impacts of Unexpected Result of InjectionInjection

Risk Short term (during injection process)

Long term (after closure)

Seismisity

Failure of well engineering

Leakage over a short path

Leakage over a long path

Health and safety Environment Impact on atmosphere

Gulf Coast Carbon CenterGulf Coast Carbon Center

www.gulfcoastcarbon.org