Sunday, November 6, 2011

CIRI drilling confirms coal seams suitable for UCG; seismic planned

Alan Bailey
Petroleum News

After an exploration program involving the drilling of 13 core holes, Cook Inlet Region Inc. has confirmed the existence of a significant coal resource likely to be suitable for underground gasification in the corporation’s land on the west side of Alaska’s Cook Inlet.

“We’ve done a significant amount of exploration work,” Ethan Schutt, CIRI senior vice president for land and energy development, told the Alaska Senate Resources Committee on Oct. 20. “Through that work we’ve confirmed that we have a significant commercial coal resource in a geological setting that is favorable for UCG (underground coal gasification) development.”

CIRI land

Stone Horn Ridge LLC, a joint venture between CIRI and Laurus Energy, is investigating the potential UCG development at a site called Stone Horn Ridge, northeast of the Beluga River, in an area where CIRI owns both the surface and subsurface land. Laurus Energy is a Houston-based affiliate of Ergo Exergy, a UCG technology company based in Montreal, Canada.
UCG involves the pumping of compressed air through a well into a coal seam deep underground to enable the controlled underground combustion of some coal; the heat from the burn converts excess air and the bulk of the coal to synthetic gas for delivery to the surface through production wells. It would be possible to burn the synthetic gas for power generation or to convert it to methane, the prime ingredient of natural gas. Other potential applications include the production of jet fuel by a gas-to-liquids process, or the production of fertilizer.

And, since the coal is processed deep underground, the UCG process eliminates much of the environmental impact of conventional coal mining and burning.

“We believe that UCG is a technology by which you can access this world-class energy resource in an environmentally acceptable manner,” Schutt said.

Schutt also assured the legislators that the underground burn required for the UCG process could be stopped very easily by closing off the flow of air required for combustion.

Multiple coal seams

Schutt said that the Stone Horn Ridge joint venture has found multiple, thick coal seams at depths below 650 feet in the Stone Horn Ridge area. The geologic setting of the coal appears favorable for the development of a UCG plant, although the joint venture is still in the process of collecting data and modeling the geology of the project site, he said.
The 13 core holes drilled for the exploration phase of the project penetrated depths ranging from about 700 feet to about 2,600 feet — the project team collected rock core and wireline data from the holes. Field and laboratory examination of rock samples; logging of the drilling mud; and field tests of the desorption of gas from coal samples also added to the data from the project site. That data have enabled the construction of a comprehensive computer-based geologic model of the site that has provided a preliminary validation of the existence of a commercial UCG resource.

The next step will be to carry out a high-resolution shallow seismic survey, gathering eight line-miles of data along three lines over a period of about 25-30 days.

“With that data we’ll complete our preliminary model of the site, incorporating that with the data that we already have, and that will help us move to the next phase of the program, which is the (resource) characterization phase,” Schutt said.

Conceptual engineering

The joint venture has already commissioned and obtained a conceptual engineering and cost analysis for a UCG development at Stone Horn Ridge, with the analysis considering various options for the use of UCG-generated synthetic gas, Schutt said.
The geologic modeling indicates the existence of about 300 million tons of coal in the Stone Horn Ridge site, a UCG resource equivalent to perhaps a little more than 4.8 trillion cubic feet of natural gas, with potential gas production rates in the range of 20 billion to 90 billion cubic feet per year, Schutt said.

And CIRI thinks that UCG-fueled electricity generation, for example, would prove significantly cheaper than generation from Cook Inlet basin natural gas, Schutt said.

But, with the project being at the leading edge of UCG technology deployment, CIRI is taking its time, being “pretty deliberate and responsible” and talking to stakeholders as the project moves forward, Schutt said.

“We’re pretty excited about the project and its potential, but we do also realize that we’ve got a lot of work in front of us,” he said.

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Republished with the permission of the Petroleum News