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SPE Distinguished Lecturer Program
The SPE Distinguished Lecturer Program is funded principally through a grant from the SPE Foundation.
The society gratefully acknowledges the companies that support this program by allowing their professionals to participate as lecturers.
Special thanks to the American Institute of Mining, Metallurgical, and Petroleum Engineers (AIME) for its contribution to the program.
Society of Petroleum Engineers Distinguished Lecturer Programwww.spe.org/dl
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The Kiss of Death
• You never want to hear the words “it was a technical success but an economic failure” about your project
• I’m going to try to help prevent this!!
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Practical Business Aspects of the
CO2 EOR Process
Ken BrownAlberta Research Council
EOR/CCS Options
Society of Petroleum Engineers Distinguished Lecturer Programwww.spe.org/dl
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Outline
• World context• Technical context• Hard Business Issues• Soft Business Issues• Summary
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The World Context
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ENHANCED OIL RECOVERY MECHANISMS
CO2Hydrocarbon
NitrogenFlue Gas
Air
Steam (soak; drive)Combustion (in situ)
Hot water
PolymerAlkaline/CausticMicellar/PolymerSurfactant (foam)
CHEMICALGAS(Miscible/Immiscible)
THERMAL
OTHER
MicrobialSeismic
Enhanced Oil Recovery
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CO2 Project Locations
Ref: IPCC Special Report on Carbon Dioxide Capture and Storage
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Worldwide EOR Production
• Production is currently 2.3 MM BOPD• Represents 3.3% of the world’s production• Some projections reach 30 MM BOPD by
year 2020• CO2 floods will be a major contributor
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Active CO2 Flood Statistics
Location Number Project BOPD EOR BOPD
World 125 373,500 285,100
U.S. 105* 323,100 249,700
Canada 8 43,000 28,000
* additional 16 projects in 2008-2009
Oil and Gas Journal April 2008
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The Technical Context
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The Size of the Prize
• Primary Production - 15% recovery
• Secondary Recovery - 30% recovery
• Enhanced Recovery - 45% recovery
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Weyburn CO2 EOR Project
00
1010
2020
3030
4040
5050
19551955 19651965 19751975 19851985 19951995 20052005 20152015 20252025
Incremental Miscible Flood ProductionIncremental Miscible Flood Production
Base Waterflood ProductionBase Waterflood Production
Incremental Horizontal ProductionIncremental Horizontal ProductionIncremental Vertical ProductionIncremental Vertical Production
Prod
uctio
n (k
bbl/d
ay)
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Weyburn Unit Oil Production
0
10,000
20,000
30,000
40,000
50,000
Jan-
55Ja
n-57
Jan-
59Ja
n-61
Jan-
63Ja
n-65
Jan-
67Ja
n-69
Jan-
71Ja
n-73
Jan-
75Ja
n-77
Jan-
79Ja
n-81
Jan-
83Ja
n-85
Jan-
87Ja
n-89
Jan-
91Ja
n-93
Jan-
95Ja
n-97
Jan-
99Ja
n-01
Jan-
03Ja
n-05
Date
BO
PD (g
ross
)
Primary & Waterflood
Pre CO2 Hz Infills
Vertical InfillsCO2 EOR
MB97-03 Forecast
Current production at 35 year high
WF Improv
Graph courtesy of EnCanaApprox. 75% of production comes from EOR area
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What do you need to know?
• Can CO2 recover incremental oil?
• If yes, at what rate and volume?
• What is the necessary investment?
• What are the ongoing operating costs?
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Technical Considerations
• The devil is in the details!!– Screen– Manage it correctly– Study 44
– Model– Pilot– Consult experts
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Hard Business Issues
• Source• Transport• Oilfield
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The Source of the CO2 ?
• Syncrude/Suncor• Wabamun• Exxon LaBarge• Saskpower• DGC• TransCanada• Hydrocarbon instead
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Borsig Compressor
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CO2 Pipeline To CanadaRegina
Estevan
Bismarck
WeyburnWeyburn
BeulahBeulah
North DakotaMontana
Manitoba
Saskatchewan
EdmontonEdmonton
CalgaryCalgarySaskatoonSaskatoon
ReginaRegina
AlbertaAlberta SaskatchewanSaskatchewan
CanadaCanada
USAUSA
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Pipeline Construction
• 1,080,000 feet of pipe
• Averaged 2-3 miles per day
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Recycle GasCompressors
Battery GasBattery GasCompressorCompressor
CO2Receiving Terminal
COCO22 InjectionInjectionWellWell
Source WaterWells
Surface Facilities for CO2
WaterWaterInjection PlantInjection Plant
EOR Oil Satellite
CO2 InjectionSatellite
Water InjectionSatellite
Water InjectionWells
Conventional Oil Satellite
CO2 from DGC
Free WaterKnock Out
Treaters(Existing)
InletSeparator
Gas Sales
Oil Sales
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Soft Business Issues
• Owners • Government • Economic value• Operational• Societal
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Owner’s issues
• Risk tolerance, cash management and capacity to invest
• Joint Venture agreement
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Government issues
• Royalty• Regulatory• Environmental
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Economic Value Issues• Price forecasts • CO2 credits• Reserves management• Risk management
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Operational Issues
• Technical competence• Operations competence
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Societal Issues• Sour gas• Storage • Socio economic
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Summary•EOR is not just a Technical challenge •Business “opportunities" exist with:
–CO2 supplier–Existing facilities–Partners–Government–Operations–Society
• A long term strategic plan to address these “opportunities” is essential