Fw: [fuelcell-energy] Coal-bed Methane Might Ease
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Coal-bed Methane Might Ease
Natural Gas Shortages
October 26, 2005
There may be more than one way around the current natural gas
shortages and the corresponding high prices. And it may be found in
underground coal seams, in a form called coal-bed methane. But the
environmental consequences of production could threaten this
Coal-bed methane is a natural gas-like fuel associated with coal
fields. But, production of it is accompanied by significant
challenges that include the prevention of unintended loss of methane
to the atmosphere during underground mining and the disposal of large
quantities of water, sometimes saline, that are unavoidably produced
with the gas.
The Bush administration wants to increase natural gas production over
the next 15 years by 40 percent. Coal-bed methane would comprise
about a quarter of that increase. In fact, the United States now
consumes about 20 trillion cubic feet (tcf) annually and the Energy
Information Administration expects that to rise to 30 tcf by 2025, if
natural gas is more moderately priced. Given that many areas are now
off-limits to production, the goal seems a bit lofty -- unless
producers can make use of coal-bed methane.
Coal-bed methane now accounts for about 7.5 percent of U.S. natural
gas production, the U.S. Geological Survey says. Recent U.S.
estimates indicate more than 700 tcf of coal-bed methane gas in
place. But, only 100 tcf is now economically recoverable, which
represents a 5-year supply at present rates of consumption. Further,
coal stores six to seven times more gas than the equivalent "rock
volume" of a conventional gas reservoir, the geological agency says.
But future growth is now under threat. Water pressure prevents the
methane trapped under the coal seams from escaping. To develop the
resource, the water must be removed so that the gas can be harnessed.
But the subsequent salt water must be disposed of and that usually
occurs in surface waters. And that, of course, directly affects the
farmers and ranchers who earn their livings from the land.
The matter has reached a boiling point in Montana, which could have
consequences for the rest of the nation. There, the Northern Plains
Resource Council filed suit against the Fidelity Exploration and
Development Co. The environmental group wants the developer to get an
environmental permit to dispose of the water.
The case was initially dismissed but was appealed to the U.S. Ninth
Circuit Court of Appeals where the plaintiffs won. Unlike the lower
court, justices there said that such water is a pollutant regulated
under the Clean Water Act. Now the case has been taken to the U.S.
Supreme Court, which may hear the case but in the meantime has
granted a stay, essentially prohibiting the development of those
methane resources unless the water can be disposed of in an
environmentally suitable manner.
In the meantime, the environmental council and the developer have
reached a tentative agreement -- with the consent of a federal
magistrate -- to allow production on 86 existing wells. But, the deal
still forbids any development unless landowners request it. Still,
the U.S. Supreme Court could alter the entire landscape. If it hears
the case and decides to uphold the appeals court decision, then coal-
bed methane developers nationally would have to go back to the
That's profound: Many of the almost 6,100 permits granted to drill
for oil and gas on federal lands in 2004 were coal-bed methane
projects. Furthermore, the U.S. Department of the Interior expects
more than 66,000 new coal-bed methane wells in Wyoming's Powder River
Basin alone in the coming years. Even the Bureau of Land Management
(BLM) says that the extraction process in just one state -- Wyoming --
would result in the discharge of 700 million gallons of potentially
contaminated groundwater per day.
"We believe that responsible development of coal-bed methane
resources in ways that are sensitive to the environment and community
concerns are in the best long-term interests of our country, natural
gas companies, and their shareholders," says a letter written by
shareholder activists to the Independent Petroleum Association of
America. The investors, which include the Calvert Group, Trillium
Asset Management and U.S. Bancorp Piper Jaffray, recommend that
developers consult with landowners, use best-available technologies
and protect the wildlife and environment.
Needless-to-say, no one wants to lose sight of the potential
environmental benefits of coal-bed methane. If the methane is
captured and used as an energy form, particularly from the
underground coal mines in the Appalachian basin that accounts for
about two-thirds of the emissions in the United States, it may make a
mark on global emissions. Nearly 10 percent of atmospheric methane
resulting from human activity is derived from coal mining.
Regulators are sensitive to all concerns. Nationally, the parties
agree that if more sites are permitted then better monitoring is
essential. The BLM, for example, says that it can require developers
to modify their designs by regulating the rate of drilling in certain
areas. At the same time, it can reduce the need for new roads by
necessitating the use of modern technology that keeps tabs on how
well the drilling equipment is working. And, finally, all land under
the jurisdiction of the BLM must be reclaimed. Such steps can go a
long way to preserve wildlife and the environment, it says.
Meantime, new technologies to treat contaminated water show promise.
Wyoming-based Drake Engineering is about to complete a demonstration
project with Marathon Oil Corp. in Sheridan, Wyo. The process the two
are using seeks to expedite the removal of salt and bicarbonate at a
reasonable cost. The engineering firm says that the price of treating
the contaminated water is about 20 cents per barrel, or 42 gallons.
Developers in Oklahoma say that they are already getting rid of
unwanted salt water in an environmentally safe manner. El Paso Corp.
is partnering with Chesapeake Energy Corp. there in an endeavor that
has already drilled about 330 coal-bed methane wells. Harken Energy,
meantime, is participating in joint partnership in Indiana to find
coal-bed methane. The Dallas-based company says that the venture
holds potential, noting that it is extracted before the coal is
mined. That provides both environmental and safety benefits.
"Over the short-term, coal-bed methane can be developed more
economically and more quickly than other deep reservoir onshore gas
or deepwater offshore gas," says Rebecca Watson, assistant secretary
for Land & Minerals Management at the U.S. Department of the
Rising natural gas prices are giving developers new incentives to
find alternative energy sources. Coal-bed methane is one of those
alternatives. Already, consumers are seeing the benefits of this fuel
source. But, if it is to be fully developed, then it is imperative
that the environmental consequences associated with drilling those
wells be properly addressed.
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