THE Shale Gas Thread (merged)

[Graeme]

The trouble with shale gas

The topic: shale gas, a kind of natural gas once considered impossible to extract that is now becoming the Great Energy Hope of a Canadian industry approaching the end of its easiest-to-find gas deposits. It took U.S. energy companies nearly two decades to figure out the immense technological challenges involved in extracting shale gas, and Canadians are just beginning that work.

Still, according to Mr. Faraj, this country holds so much shale gas that it stretches the bounds of believability.

He has estimated that Canada's depths could contain as much as 15,000 trillion cubic feet (TCF) of gas -- a staggering number nearly triple the proven gas reserves for the entire world. But shale gas is anything but proven, and experience has shown that very little of the gas in place can actually be extracted.

All of which helps explain why in 2007 the industry spent a record-shattering $928-million to secure oil and gas rights over 400,000 hectares of three zones of northeastern B.C. shale, an area the size of Prince Edward Island in a province that is creating a new, shale-friendly royalty regime that is drawing companies away from Alberta

"They're moving in," said Warren Walsh, a senior petroleum geologist with the B.C. Ministry of Energy, Mines and Petroleum Resources. "This could be the next great unconventional play in North America."

When a drill bores into a shale gas deposit, the gas often won't rise to the surface at all. Why? In a traditional deposit, the gas is pooled inside fractured rock, and can escape and flow through the millions of tiny cracks in the rock. In shale, much of the gas is stuck on to rock that contains far fewer cracks. As a result, it can't flow -- at least, not without the help of expensive fracturing technology, which cracks the rock enough that the gas can escape.

financialpost

[efarmer]

The troubles with shale gas, tar sands, hydrogen economies, and methane hydrates are all very similar in my opinion Graeme; they are not ready, will not be ready soon, and they are such a crap shoot and stretch of economy, policy, and technology, that they may never be ready. Next we couple that with the fact that we are just around the half way point of using our petroleum up and will mainly burn petroleum until we simply cannot even remotely justify it any longer.

The rich and the royal had human servant energy before the fossil fuel age, and in the decline of the age, they will probably be the last to have the fossil fuel energy, and will of course retain all of their human servants and be positioned for many more at the right price as time goes forward.

I believe that many of us, myself included, are petroleum amplified, pseudo rich, and that we are in the wind in a very big way my dear Graeme. I think that petroleum depletion may very well be far more gradual than the dire predictions I have seen, I am more concerned about us doing nothing on our own due the the plethora of Hollywood endings for sale to those who wish to buy one and wait for it to be delivered.


Looking carefully at the script, efarmer decided he would try to rewrite Act 5 and make it happier yet not a dream sequence.

1. Womber.
2. Boomer.
3. Zoomer!
4, Gloomer?
5. Doomer;
6. Tomber.

[Tanada]

You know despite what we might think the Soviet Union did do some rather creative things IRT gas and oil production.

One mthod they used with considerable success for unlocking gas in tight formations is quite simple, they would drill a shaft down to the bottom of the formation and then lower a small nuclear explosive into the well, setting it off very deep under the ground. The shockwaves would crack the formation for great distances and create a chamber filled with loosely packed rock debris. Then that would drill another well into the loose pocket they created and draw off the gas as fast as the crack network could refill it.

Of course the gas was slightly radioactive, but if you are using it for power plants that is not a concern. Using it for sealed combustion furnaces would also not be a concern, but direct flame stoves would be a less healthy use for home owners.

They did similer work with low porosity oil formations, purportedly doubling extraction rates.

Perhaps it is time to seriously reveiw these actions and see if they could be economically used.

[Graeme]

Unconventional Natural Gas Reservoir In Pennsylvania Poised To Dramatically Increase US Production

Natural gas distributed throughout the Marcellus black shale in northern Appalachia could conservatively boost proven U.S. reserves by trillions of cubic feet if gas production companies employ horizontal drilling techniques, according to a Penn State and State University of New York, Fredonia, team.


"The value of this science could increment the net worth of U.S. energy resources by a trillion dollars, plus or minus billions," says Terry Engelder, professor of geosciences, at Penn State.

Engelder, working with Gary Lash, professor of geoscience, SUNY Fredonia, has conservatively estimated that the Marcellus shale contains 168 trillion cubic feet of natural gas in place and optimistically suggests that the amounts could be as high as 516 trillion cubic feet.

The U.S. currently produces roughly 30 trillion cubic feet of gas a year, and these numbers are dropping. According to Engelder, the technology exists to recover 50 trillion cubic feet of gas from the Marcellus, thus keeping the U.S. production up. If this recovery is realized, the Marcellus reservoir would be considered a Super Giant gas field.

Engelder, who has studied this area of the U.S. for most of his career and began looking into fractures under a National Science Foundation grant 25 years ago, has identified and mapped natural fractures in the Marcellus shale. He and Lash will present some of their recent work at the 2008 American Association of Petroleum Geologists Annual Convention and Exhibition this spring.

sciencedaily

[Oil-Finder]

I kinda covered this here.

[steam_cannon]

You can power most any engine or heating system off of gas.
It's an interesting article, something to keep an eye on...

[Chuckmak]

hopefully my state will be the first to see the benefits of this.

[Oil-Finder]

I just discovered a very good article about this with a bit more technical info on Petroleum News:

--> Appalachia to the rescue <--

Teaser:

In a report published mid-January two geologists have suggested that a rock unit known as the Marcellus shale that extends from southern New York state through western Pennsylvania into eastern Ohio and West Virginia may contain anywhere from 168 trillion cubic feet to 516 tcf of natural gas. That could translate to a “super giant” gas field with at least 50 tcf of technically recoverable gas, the geologists, Terry Engelder, professor of geosciences at Pennsylvania State University and Gary Lash, professor of geosciences at the State University of New York (Fredonia), have said.

The 50 tcf estimate is based on about 10 percent of the 516 tcf gas-in-place number, Engelder told Petroleum News Jan. 21.

“Believe you me, that 500 tcf … number is conservative,” Engelder said.

In comparison, the U.S. Geological Survey puts known, technically recoverable natural gas reserves in northern Alaska at 35.5 tcf, 24.5 of which are in the Prudhoe Bay field, and total undiscovered, technically recoverable gas onshore and offshore Alaska’s North Slope at more than 200 tcf, for a grand total of 235.5 tcf of conventional natural gas in the northern part of the state.

From an article in Buffalo Business First, here's a map showing where the Marcellus Shale is located. It's not just Pennsylvania:

[SchroedingersCat]

Shale gas requires 'stimulation' to make it recoverable. This usually means fracturing the seams and holding them open to allow the gas to move. This requires a very large amount of water.

Shale gas has been known for decades. It has been economically unfeasible to recover.

The Domestic Natural Gas Status

Normally Devonian shale gas wells are stimulated by artificial fracturing with explosives or hydraulic pumping. While some shale wells may outperform some conventional gas wells on a cumulative production basis, their slow flow rates result in a slow rate of return on invested capital.

If gas prices increase enough and they can fight the local communities for water rights, they will extract it. If.

[Oil-Finder]

^
Since most of the area containing the Marcellus shale receives 35-50 inches of precipitation per year, I don't think water availability is a problem (sans an occasional drought).

Unconventional gas sources, while more expensive and technically demanding to extract, have a flip side: They are more abundant and occur in larger formations, thus reducing risk.

LINK

Unconventional Gas Production

Traditionally, conventional natural gas production has centered on sandstone and carbonate rock formations. Increasingly, however, the nation has turned to low-permeability, tight sandstones, gas shales and coal bed methane formations to increase our nation's natural gas reserves.

With our strong technical and operating expertise related to shale formations, we are well positioned to deliver on our nation's growing need for natural gas.

Our DTE Gas Resources subsidiary operates more than 150 wells in the Fort Worth basin. Located in north central Texas, the Barnett shale formation has emerged as one of the largest and most active gas fields in North America.

Conventional vs. Unconventional Gas Production


From an investment standpoint, conventional natural gas exploration holds more risk. Gas reservoirs are typically smaller and/or more difficult to locate.

On the other hand, unconventional gas reservoirs can exist over a large area penetrated by older conventional wells, reducing the exploration risk. Horizontal drilling techniques may enhance and extend production of unconventional natural gas.

Unconventional reservoirs exist in a self contained environment where the productive formation may act as source, reservoir and seal. After test wells prove the economic viability of a given area, unconventional resources can be developed on a large scale.

[Oil-Finder]

Shale gas has been known for decades. It has been economically unfeasible to recover.

Incidentally, this is not true anymore (your article was from 1995). Here is a graph showing production from the Barnett Shale in Texas, which is currently the largest-producing gas shale in the US. If it were uneconomical to recover, then why has production soared?

Texas Barnett Shale Gas Production
(1993 through 2006)

Source

[SchroedingersCat]

In 1993 US withdraws were about 2 tcf per month. In 2007 they still are. Prices have more than tripled in that time. Higher prices mean more money for more wells. Even with all the drilling we are still at 2 tcf per month.

My point is that this is not a new find and there are geologic, economic and social issues that will limit how quickly production can be developed. It's great that we have these resources and that they generally don't produce at a high rate. A small, steady supply.

[Graeme]

Chesapeake Energy to Drill in "Marcellus Shale" (VIDEO)

Underneath New York and Pennsylvania is an untapped reservoir of natural gas that could swell U.S. reserves. It's called the Marcellus Shale and energy companies are looking to get in on the action.
Researchers at Penn State University and SUNY Fredonia say the Marcellus Shale could contain as much as 50 trillion cubic feet of recoverable natural gas. Right now the U.S. produces less than half of that.
The shale covers 54,000 square miles, including the Northern and Southern tiers.
The folks at Oklahoma-based Chesapeake Energy, which has a field office in Big Flats, are interested in drilling in the Marcellus Shale. Spokesman Matt Sheppard says it's an exciting prospect.

weny

[Oil-Finder]

--> Cabot Oil & Gas Provides Operations Update <--

Appalachia - Marcellus

"The most exciting new play in the U.S. right now is the Marcellus section of the Devonian shale in the east," commented Dinges. "Cabot has a substantial holding of acreage with Marcellus potential and an ongoing program gathering multiple data points."

The Company continues its extensive leasing program in six targeted areas in Pennsylvania and West Virginia, targeting the Marcellus shale. To date, well over 100,000 net acres have been leased. In addition, two vertical wells have been drilled in one area with limited tests from a thick Marcellus section at rates between 800 Mcf and 1,000 Mcf per day. This rate exceeds most of reported industry rates from vertical Marcellus completions. With information from these wells, Cabot has initiated its 20 well development program for 2008 in the area. The third well (vertical) will spud by month-end with the fourth well (horizontal) to spud in March. Pipeline applications and infrastructure support work has begun with expected first production in the third quarter.

"The reason we are excited about this play is the fact that the Marcellus regional shale could contain several hundred TCF of gas in place. This shale is sparsely drilled, both vertically and geographically, it is normal to over-pressured in contrast to the shallower pays in the basin, and it appears to be extensively fractured. Also, the rocks are at the optimum maturation level, with the rock mechanical properties appropriate for maximum stimulation effectiveness. Cabot holds a very large acreage position, both existing and new, with Marcellus potential," said Dinges.

Dinges added, "In addition to our leasing, we have begun an effort on our existing leasehold that has proven Marcellus under several hundred thousand of Cabot's acreage in West Virginia." The Company has deepened several wells to the Marcellus and determined that slick water stimulation is more effective than nitrogen fracs in the higher pressured Marcellus section. Most recently Cabot drilled three vertical wells on its West Virginia acreage and applied slick water fracs to the Marcellus with encouraging flow test rates between 1.2 and 1.8 Mmcf per day. Cabot has recently spud its first horizontal Marcellus test in West Virginia.

"As we continue gathering this encouraging information we are evaluating different options of capital allocation to enhance our program," stated Dinges.

[Oil-Finder]

--> Atlas sees 4-6 tcf from Marcellus shale <--

Atlas sees 4-6 tcf from Marcellus shale
By OGJ editors

HOUSTON, Feb. 21 -- Philadelphia operator Atlas Energy Resources LLC said it has determined that it could ultimately recover 4 to 6 tcf of natural gas from the Devonian Marcellus shale on its properties mostly in southwestern Pennsylvania.

Atlas Energy controls 483,000 acres in Pennsylvania, New York, and West Virginia and is aggressively adding land.

After reviewing the length of its hydraulic fracs, the company said it believes it will be able to develop the formation with vertical wells on 40-acre spacing. That would give it 4,000 to 6,000 potential locations in southwestern Pennsylvania, where it is concentrating on 224,000 acres and where it has drilled all but one of its Marcellus wells.

Almost all of the southwestern Pennsylvania acreage has ample pipeline capacity that is controlled by the company's affiliate, Atlas Pipeline Partners LP.

[..]

[Kingcoal]

Ironic in that southwest PA is where it all started (the oil business that is.)

[Schneider]

Sooo..if i get it correctly..this Mercellus shale would supply,at the end, among for ...2, perharps 3 months of the current US natural gaz consumption...right?

[TreeFarmer]

For what its worth, the oil business started in NorthWest PA, you were close with SW.


TF

[Kingcoal]

For what its worth, the oil business started in NorthWest PA, you were close with SW.


TF

I'll agree on west central PA Either way, the woods in the entire western half of the state is covered in rusting pump jacks. When we were kids visiting Grandma, we used to go hiking and find them, buried under years of vegetation. They were fun to play with.

[Oil-Finder]

Sooo..if i get it correctly..this Mercellus shale would supply,at the end, among for ...2, perharps 3 months of the current US natural gaz consumption...right?

That's true if only 50 tcf can be extracted from this shale.

But if you read the Atlas Energy piece, they say they believe they can extract 4-6 tcf just from their own (~755 sq mi) holdings. As Graeme's link above said, the Marcellus Shale covers 54,000 square miles, so Atlas's holdings cover only 1.4% of the area of the shale - and yet they claim their 1.4% of the land area can recover 8%-12% of the supposedly recoverable reserves. Unless Atlas happens to have most of all of their properties in the best spots of the shale, this suggests that the 50 tcf recoverable estimate is probably conservative.