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Fw: [fuelcell-energy] Coal-bed Methane Might Ease

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  • Pat N self only
    ... 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
    Message 1 of 1 , Nov 3, 2005
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      ---------- Forwarded Message ----------
      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
      potential.
      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.

      Advances Possible

      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
      drawing board.

      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.

      New Technologies

      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
      Interior.

      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.


      http://www.energycentral.com/content/newsletter_creation/energybizinsi
      der_html_creation.cfm?articleid=48

      http://tinyurl.com/95kql

      j2997








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