permian basin overview july 25, 2006. mcelmo dome unit doe canyon unit cortez pl sheep mountain unit...
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Permian Basin OverviewPermian Basin Overview
July 25, 2006July 25, 2006
McElmo Dome Sheep Mountain
Bravo Dome
Guyman
Doe Canyon
Wellman PL
0 25 50 75 10012.5Miles
Permian Basin CO2 Pipeline Map
K INDER M ORGAN
Contact 1-800-247-4122www.kindermorgan.com
McElmo Dome Unit
Doe Canyon Unit
Cortez PL
Sheep Mountain Unit
Bravo Dome Unit
Bravo PL
Sheep Moutain PL
Denver City
CRC PL
Central Basin PL
W Bravo Dome
Val Verde Plants
How did it Happen?How did it Happen?
Wasson
TexasNew Mexico
Welch
Slaughter
SACROC
Salt Creek
Terrell Plant
Grey Ranch Plant
Mitchell Plant
Puckett Plant
YatesPermian Permian BasinBasin
Circa 1970Circa 1970
GeraldineFord
ElmarN. Dollarhide
S Cross
S. Cowdan
Means Unit
Cogdell
Mabee
SeminoleNorth Hobbs
Adair
Southern CRCSouthern CRC
CR
C P
ipel
ine
McCamey
New Mexico
Welch
Slaughter
SACROC
Salt Creek
Terrell Plant
Grey Ranch Plant
Mitchell Plant
Puckett Plant
CR
C P
ipel
ine
Yates
Permian Permian BasinBasin19721972
S Cross
GeraldineFord
ElmarN. Dollarhide
Wasson
TexasMeans Unit
Mabee
S. Cowdan
Cogdell
Seminole
Adair
North Hobbs
Windfall Profits Tax adopted in 1980Windfall Profits Tax adopted in 1980 Waterfloods unitized in the 60’s and 70’s had started Waterfloods unitized in the 60’s and 70’s had started
to declineto decline Owners of Potential EOR Projects aligned with COOwners of Potential EOR Projects aligned with CO22
Source FieldsSource Fields Major Oil Companies operating in PermianMajor Oil Companies operating in Permian
Shell, Mobil, ARCO, Exxon, AmocoShell, Mobil, ARCO, Exxon, Amoco Source Field UnitizationsSource Field Unitizations
Shell, Mobil, et al – McElmo DomeShell, Mobil, et al – McElmo Dome ARCO/Exxon – Sheep Mountain UnitARCO/Exxon – Sheep Mountain Unit Amoco, Hess, et al - Bravo Dome UnitAmoco, Hess, et al - Bravo Dome Unit
Majors commenced planning and development for Majors commenced planning and development for their EOR projectstheir EOR projects
Southern CRCSouthern CRC
CR
C P
ipel
ine
McCamey
Denver City
New Mexico
S. Cowdan
Slaughter Salt Creek
Terrell Plant
Grey Ranch Plant
Mitchell Plant
Puckett Plant
CR
C P
ipel
ine
Elmar
YatesPermian Permian
BasinBasin1982 - 19891982 - 1989
Sheep Mountain
Bravo DomeMcElmo Dome
Welch
Central B
asin
N. DollarhideGeraldineFord
Mabee
Means Unit
Denver UnitWasson
S Cross
SACROCTexas
CordonaLake
Cogdell
Cortez Pipeline
SMPL B
ravo P/L
Seminole
Val Verde
CR
C P
ipel
ine
McCamey
Denver City
New Mexico
S. Cowdan
Slaughter Salt Creek
McElmo Dome
Terrell Plant
Grey Ranch Plant
Mitchell Plant
Puckett Plant
CR
C P
ipel
ine
Yates
Sheep Mountain
Bravo Dome
Permian Permian BasinBasin
1990 - 19991990 - 1999
Welch
Este
GeraldineFord
Elmar
N. Dollarhide
S Cross
SACROC
CordonaLake
Reinecke
Sharon Ridge
Cogdell
Mabee
Cortez Pipeline
SMPL Bravo
P/L
Central B
asin
Means Unit
Adair
Seminole
Val Verde
CR
C P
ipel
ine
McCamey
Denver City
New Mexico
S. Cowdan
Slaughter Salt Creek
McElmo Dome
Terrell Plant
Grey Ranch Plant
Mitchell Plant
Puckett Plant
CR
C P
ipel
ine
Yates
Sheep Mountain
Bravo Dome
Permian Permian BasinBasin
2000 - 20062000 - 2006
Welch
Este
Este
GeraldineFord
Elmar
N. Dollarhide
S Cross
SACROC
CordonaLake
Reinecke
Sharon Ridge
Cogdell
Mabee
Cortez Pipeline
SMPL Bravo
P/L
Central B
asin
Means Unit
Adair
Seminole
Centerline PL
North Hobbs
EOR Projects started in 1983 are still EOR Projects started in 1983 are still purchasing CO2.purchasing CO2.
Original projections indicated these Original projections indicated these projects would be on total recycle but projects would be on total recycle but HCPV Slugs have steadily increased.HCPV Slugs have steadily increased.
Projects such as Denver Unit and Projects such as Denver Unit and Seminole San Andres Unit have been Seminole San Andres Unit have been expanded into the Transition Zone and expanded into the Transition Zone and Residual Oil Zone respectivelyResidual Oil Zone respectively
Higher oil prices have justified startup Higher oil prices have justified startup of smaller and/or previously marginal of smaller and/or previously marginal projectsprojects
Current Denver City CO2 supply Current Denver City CO2 supply from all sources 1,420 MMCFDfrom all sources 1,420 MMCFD
With oil price increasing, project With oil price increasing, project expansions as well as new projects expansions as well as new projects are justifying expansion of CO2 are justifying expansion of CO2 source fieldssource fields
Kinder Morgan and partners are Kinder Morgan and partners are expanding McElmo Dome Unit by expanding McElmo Dome Unit by 200 MMCFD and initiating 200 MMCFD and initiating development of Doe Canyon Unit development of Doe Canyon Unit to 100 MMCFD.to 100 MMCFD.
Kinder Morgan and co-owners are Kinder Morgan and co-owners are planning expansion of Cortez planning expansion of Cortez Pipeline to accommodate SW Pipeline to accommodate SW Colorado source field expansionsColorado source field expansions
Expansion and development Expansion and development opportunities also exist in NE New opportunities also exist in NE New Mexico at Bravo Dome Unit Mexico at Bravo Dome Unit operated by Oxy and West Bravo operated by Oxy and West Bravo Dome Unit operated by HessDome Unit operated by Hess
0
500
1000
1500
1985 1990 1995 2000 2005
2005 was record 2005 was record year, supplies pro-year, supplies pro-rated on occasionrated on occasion
How does the Permian Basin success How does the Permian Basin success story translate to Wyoming?story translate to Wyoming?
Supply, Transportation and Demand Supply, Transportation and Demand have to be aligned. The 80’s had the have to be aligned. The 80’s had the Supply and Demand fields mostly owned Supply and Demand fields mostly owned by the same companies. It is different by the same companies. It is different today.today.
Must be a win-win proposition for allMust be a win-win proposition for all What is the catalyst for EOR expansion What is the catalyst for EOR expansion
in Wyoming - oil price, emissions in Wyoming - oil price, emissions regulation, other?regulation, other?
CO2-A (emissions) is more CO2-A (emissions) is more expensive to capture and expensive to capture and compress than CO2-N is to compress than CO2-N is to develop and producedevelop and produce
CO2-A is likely to cost $2.00 - CO2-A is likely to cost $2.00 - $2.50/MCF Delivered$2.50/MCF Delivered
6-10 MCF/BBL has been a “rule of 6-10 MCF/BBL has been a “rule of thumb” utilization rate for new thumb” utilization rate for new projects in the Permian Basinprojects in the Permian Basin
End