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Oilfield Technology
December
2014
transported 225 km to Golden Trend and Sko‑Vel‑Tum fields
near Oklahoma City where it is injected in EOR floods.
Ì
Ì
Air Products is working with Valero to upgrade two of
the latter’s existing steam methane reformers (SMRs) at
their refinery in Port Arthur, TX. The system will capture
approximately 1 million tpy from the SMR flue gases,
then transport the gas to an EOR flood operated by
Denbury Energy.
Drawbacks
Not all reservoirs are good candidates for CO
2
EOR, however.
Reservoir oil should be relatively light, above 25 API. The
reservoir temperature must be above a certain threshold, and
operators need a minimum miscible pressure of 8 ‑ 10 MPa.
The process also works best in carbonate rock reservoirs that
lack natural water drive, gas caps and major fracture patterns.
Some fields are not equipped with the correct
infrastructure materials to handle CO
2
EOR. When CO
2
mixes
with water in the oilfield, it produces a corrosive acid. Fields
that are ‘sour’ (they have a high CO
2
or hydrogen sulphide
content) are fitted with stainless steel production lines to
withstand the corrosion, but those that are sweet are usually
equipped with less expensive standard steel.
Any CO
2
leaking out of a sweet reservoir would cause
extensive damage to its production facilities. This problem
has bearing not only in North America, but in offshore basins
such as the North Sea, as well. There, most oilfields are
sweet, so they were not fitted with stainless steel. Also, wells
and the infrastructure necessary for CO
2
EOR are an order of
magnitude more expensive offshore (the few CO
2
reinjection
examples that exist, such as Sleipner and Snøhvit in Norway,
are pure sequestration projects, where CO
2
produced with
natural gas is separated and re‑injected into a different
formation).
But the biggest barrier to CCS is the cost. Installing the
equipment necessary to achieve commercial scale capture
is usually in the range of US$ 1 billion. Various estimates
place the operating cost of capturing CO
2
from US$ 15/t for
gasification plants, to US$ 75/t for coal‑fired power plants.
Transportation investment would also be expensive.
Several years ago, the Interstate Natural Gas Association of
America (INGAA) Foundation released a research paper in
which they examined US and Canada’s CO
2
infrastructure
needs. The INGAA study looked at two scenarios; the low and
high case. In the low case, the US would have a CCS capacity
of 300 million tpy by 2030, and in the high case, 1 billion tpy
(or about 50% of annual coal‑fired plant emissions). In
the low case, the network would need 7900 miles of pipe
costing US$ 12.8 billion (with over US$ 7 billion spent for
compressors). In the high case, the network would need up
to 56 000 miles of pipe costing US$ 65 billion (with almost
US$ 25 billion for compressors).
There are several further factors in play that complicate
CO
2
EOR projects. Major players, for instance, have divergent
drivers. Oil producers want a low price for CO
2
, and do not wish
to pay for pipelines to deliver the product. Emitters wish to
maximise government subsidisation in order to reduce upfront
capital costs, and offset capture costs through a higher CO
2
commodity price. Governments, who are looking to capture
GHG emissions in order to meet reduction goals, do not want
to spend inordinate amounts of taxpayer dollars.
In addition, there is the complication of liability. In the
event, say, of corrosion damage resulting in CO
2
leaking from
a reservoir, who is responsible for repairs? There exists no
legislation in any jurisdiction to address such issues.
Finally, even if all conventional oilfields converted to EOR,
it would only handle a fraction of CO
2
emissions. Alberta, for
instance, has numerous immense, mature fields that would
benefit from CO
2
EOR; operators could ultimately capture a
total of up to 400 million t. But annual emissions in Alberta
amount to 230 million tpy, more than half the total.
Solutions
Finding ways to overcome challenges will involve activity on
many different fronts. As more and more CCS systems are
paired with EOR, R&D will drive capital and operating costs
down. Normally, for instance, pure CO
2
has been used for EOR;
recently, researchers have begun testing less‑pure (and much
cheaper) CO
2
streams in order to determine viability.
Bridging the gap between costs and sustainability
will require an imaginative mix of business models. For
instance, CO
2
can be treated like municipal trash, where the
municipality pays for someone to pick it up and dispose it in a
landfill for a commercial return. In a merchant model, credits
are established for disposing each tonne of CO
2
; if sufficiently
high, entrepreneurs will be willing to build CCS to obtain
credits that they can sell over the open market. Large emitters
could follow a model where they integrate a CCS system
into their utility plant, much like they would do for a fire
suppression system or any necessary component.
The GCCSI has several suggestions. First, the US needs to
enact GHG legislation in order to supply clarity to investment.
Costs for capture, transportation and storage need to be
lowered through intensive R&D, and the public needs to be
more informed about how the CCS process works, and the
benefits involved. Finally, tax incentives need to be adjusted
so that CCS does not suffer at the benefit of renewables, such
as wind and solar. “In order to achieve emission reductions
in the most efficient and effective way, governments should
ensure that CCS is not disadvantaged,” notes the Institute.
In the meantime, various jurisdictions are auditing the best
way to combine GHG reduction with EOR. The government
of Saskatchewan recently released a report prepared by the
Integrated CO
2
Network (ICO2N) that examined sources, fields
and saline aquifers within its boundaries, under a carbon
capture usage and storage (CCUS) scenario.
The most economical source of manmade CO
2
is
SaskPower, the provincially‑owned electricity utility.
Currently, SaskPower is retrofitting its Boundary Power station
with a C$ 1.24 billion CCS module, and other coal‑fired plants
offer similar opportunities.
Candidates for EOR include 15 fields in central west
Saskatchewan, and a further 11 fields near Weyburn, in
southern Saskatchewan. All told, industry could consume
approximately 17 megatonnes of CO
2
per year, adding more
than 100 000 bpd to provincial output.
While supplies and demand may fluctuate, both regions
have ample saline aquifer capacity where unused CO
2
could
be securely stored. “Because CCUS is a fairly new technology,
we are very confident that we are going to find opportunities
to reduce costs in all areas,” noted Robert Craig, Managing
Director at ICO2N. “I think there are lots of opportunities,
especially on the capture side, by moving some early projects
forward, and then learning from those projects in helping drive
down the costs of this technology.”
