TEOR Technology Opportunity for: Kern County Heavy Oil Operations

Transcription

1 TEOR Technology Opportunity for: Kern County Heavy Oil Operations Bakersfield, California, 30 October 2008 George S. Nitschke, D.Eng., P.E.

2 Good Earth Mechanics (GEM) Thermal Enhanced Oil Recovery (TEOR) Using Geopressured-Geothermal (GPGT) Reservoirs GEM technology converts GPGT reservoirs to renewable energy systems (solar ponds) while enabling cost effective TEOR of collocated oil <½ the fuel per bbl steam (v. gas-fired steam generators) $3 $5 cost savings per bbl steam $8/Mcf gas) Establish renewable energy systems ( cost neutral solar ponds) Net neutral carbon footprint (with renewable energy offset) Cheap steam for TEOR while fully addressing the A.B.32 challenge 2

3 Outline GEM GPGT-TEOR for Kern County GPGT resource GEM technology Projected Revenues & Benefits Piloting Opportunities 3

4 The GPGT Resource NOTE: GPGT is largely UNTESTED in Kern County Geopressured-Geothermal energy (GPGT) is an immense energy resource that remains relatively untapped throughout the world High pressure, high temperature, gas cut, brine reservoirs wellhead pressure: psi brine temperature: F GPGT brines contain scf/bbl natural gas normally found at depths greater than 10,000 feet can be produced at high flow rates: 20,000 40,000 bbl/day GPGT brines contain 15, ,000 ppm dissolved solids, typically 85% NaCl outstanding flow longevity (Dept. of Energy flow tests, Gulf Coast region) The recoverable GPGT energies are thermal (heat exchange with brine) mechanical (flowing pressure at wellhead) chemical (natural gas) U.S. GPGT regions are strategically collocated California/Gulf Coast GPGT collocation with water crisis regions GPGT collocation with medium-to-heavy U.S. oil reserves Not to be confused with hot-rock geothermal energy 4

5 The GPGT Resource Survey of Potential GPGT in CA, Mar.1993, GeothermEx U.S. / California GPGT 5

6 Overview: GEM Technology

7 GPGT Conversion Segment Recover GPGT brines for TEOR and build solar FEED ponds as a co-product ELECT GPGT Conversion Segment Recover brine, separate gas Produce H2O, elect., sat. brine Use sat. brine to build solar ponds Use H20, elect. for TEOR steam <1/2 gas for steam (v. OTSG) net zero carbon footprint zero-discharge produced water Other Key Attributes Patented/patent-pending technology Modular, flexible configurations Example configuration in RH figure H2O STEAM SAT.BRINE 7

8 Solar Energy Segment 0.4m UCZ 1.4M NCZ 1.8m LCZ Temp. LCZ: C UCZ pump Solar Energy Segment LCZ Use sat. brine to build renewable energy systems as co-product Large-scale market for saturated brine by-product, avoiding disposal Each baseline GPGT system builds a ~100 acre solar pond every 5 yrs Each 100 acre SP yields ~2+ MWe continuous solar thermal electricity brine preheat condensate flashtank main HX turbine generator condensor make up 8

9 Example Steam Design Points (x,p) Baseline Case: 20k bpd, 35k ppm, 60 scf/bbl, 300F with system optimization Produce steam at any of these P.x design points with the same GPGT source well and surface system extrapolation to higher pressures OK 9

10 Example Sites in Kern County Beer Nose Cymric Railroad Gap South Belridge Elk Hills Shafter Midway-Sunset North Belridge NOTE: Oil&gasoperatorswouldviewtheonsetofGPGT as a negative consequence and hence avoid drilling GPGT zones, or use weight mud, drill through, and/or cement off GPGT encroachment. Therefore using oil and gas well log data to assess GPGT resources (as done here) may paint an overly conservative picture, as the Kern GPGT pays have not been flow tested like the Gulf Coast DOE GPGT test wells were (e.g., measured temps might be confounded with other zones, salinity not representative of cleaned-up reservoir flow, pressures not corrected for skin factors, etc.). 10

11 Outline GEM GPGT-TEOR for Kern County Projected Revenues & Benefits Costs & returns Other benefits Piloting Opportunities 11

12 Planning Costs: Surface Systems $M = 1E06 $ Pilot (including NRE) Production Pelton Turbine / Generator $1M $0.5M Multi-Effect Distillation (MED) / Pwr Equipment $14M $10M Steam Fluid Conditioning System (FCS) (gas turbine, 4-stage vap.comp. intra-stage evaporative cooled, coupled electric motor) Spray Evap Pond (SEP) (½ acre H2O SEP, simple pit construction) Misc. Equipment, Facilities, Construction (pumps, piping, control trailer/system, roads) $8M $6M $0.3M $0.2M $0.4M $0.3M Contingency (20%) $4.7M N/A Total Surface Systems (20+ yr life) $28.4M $17M GPGT Source Well (5+ yr life) (10,000-12,000 ft., 20,000 bpd flowrate) $3M $3M 12

13 Planning Costs: Solar Ponds $ per acre costs Pilot (small scale demo) Production Construction (earthwork, level/dike area, geosynthetic clay liner with double-wall monitoring, piping and pumps) Power Equipment (low-temp ORC, 100 kw range for pilot, 2+ MW range for production, controls, monitoring) $120,000 $40,000 $30,000 $20,000 Conveyance (pilot on-site, convey to opt. location for production) N/A $1M (per 100 acres) Contingency (20%) $30,000 N/A Total cost per acre (20-24 kw e /ac. ann. avg., $0.0195/kWh SP O&M) $180,000 $70,000 13

14 Projected Returns Projected Returns: Ideal Production, Baseline Kern GPGT Case CAPEX OPEX Products Net costs GEM TEOR $/bbl steam OTSG $/bbl steam $17M surface systems (20 yr) $3M GPGT well (5 yr) $2,946,497 annualized costs $750,000 annualized expense 6000 bpd steam (P=1000, x=0.7) 500 kgal/day H20 20 ac/yr SP (24 kwe/ac SP pwr) $1,350,000 annual returns + steam $2,346,497 per yr $1.12 per bbl steam projected unadjusted costs $5.70 per bbl steam $4.56 (gas+costs) + $1.14 (CO2 tax) Equipment capitalized over 20 yrs GPGT well capitalized over 5 yrs 11% discount rate operators, 350 day operating year equipment, borehole maintenance distilled H20 (TDS<5 ppm) $2/kgal $5/We solar pond value ($120k/ac) $70k/ac SP costs ($50k/ac net) $6,704 per operational day for 6000 bpd steam (P=1000, x=0.7) plus 3.33 bbls GPGT brine add other ovhd costs, fees, license, etc. carbon tax offset by solar pond install 1.2x price of gas ($8/Mcf gas) Mcf/bbl steam $40/ton CO2 tax (120 lbm CO2 per Mcf) 14

15 Other Benefits: Carbon Footprint Carbon Avoidance Steam Production The GEM steam production method reduces fuel gas by <1/2 per unit which similarly reduces the CO2 release, e.g., for thermal enhanced oil recovery (TEOR) Carbon Offset Solar Ponds A 10MWe solar pond, producing perpetual solar-thermal electricity, will offset the CO2 released from steam production during the GPGT well-life and GEM systems operation CO2 Sequestration GPGT Reservoirs The post-production GPGT brine reservoirs will provide for CO2 geo-sequestration, using industry methods (in development) GEM technology will yield a net-negative carbon footprint 15

16 Other Benefits: Produced Water TEOR Steamflood Return Water Conventional TEOR steamflood practice results in 3-10 bbl of produced water per bbl recovered oil. Management of these produced waters is becoming an increasing problem to the operators, e.g., regulations restricting disposal using percolationevaporation ponds. The GEM TEOR method provides various options for dealing with the produced water, e.g., reclamation for potable/irrigation, reduce and use for solar ponds, and recirculate to the GPGT reservoir for thermal regeneration. The GEM TEOR method results in zero-discharge of produced water 16

17 Other Benefits: Water & Energy Integrated Water & Energy Water shortages in the West have been increasing towards crisis levels in areas proposed for GEM Thermal Enhanced Oil Recovery (TEOR): California, Texas. Increasingly frequent and intense droughts, population growth, and environmental demands are driving this impending U.S. crisis (Water 2025). Large-scale coastal desalination is seen as a part of the solution to this crisis. Two barriers to coastal desalination are energy (need new, clean energy source) and cost. GEM s technology solves these issues by establishing a cost effective, CO2-free renewable energy source in sufficient quantities to power enough coastal desalination to replace the entire municipal water needs in CA and TX. 17

18 Outline GEM GPGT-TEOR for Kern County Projected Revenues & Benefits Piloting Opportunities 18

19 GEM TEOR is Pilot Project Ready Establish a Pilot Project to profitably demonstrate GEM TEOR - Step 1: Assess CA GPGT energy characteristics Leverage govt cost-share opportunities to offset risk Conduct limited/focused GPGT well drilling/testing program (for Kern TEOR) - Step 2: Proof the GEM TEOR systems performance Potentially leverage govt guaranteed loans Potential govt cost-share to offset development costs - Step 3: Conduct solar pond demonstration Leverage collaboration opportunities with State/DOI to offset liability, permitting Collaborative demonstration provides test-site for State SP policy development Candidate Pilot Project Partners: - Heavy-oil lease operators - Renewable-energy infrastructure developer / purveyor - Other industry partners (equipment suppliers) - State and Federal agencies (e.g., for cost share, collaboration, data support) Role of Good Earth Mechanics, LLC - Holds GEM TEOR intellectual property - Association of subject matter experts to promote GEM GPGT technology - Expertise to develop, support, and manage the pilot, solar pond demonstration - Conduct vendor coordination, feasibility studies, engineering models

20 Pilot Configuration Build-Up Flexibility GPGT Well Surge Tank Sell Gas Simple to complex Pelton Generator Separator -- Pelton Wheel Disposal Well GPGT Well Surge Tank Vent GPGT Well Surge Tank Vent Disposal Well Solar Ponds Disposal Well Pelton Generator Separator -- Pelton Wheel Pre- Heat Flue Flash Tank H2O Distillate 1 st Effect Manifold 2 nd Effect N Effect Spray-Evap/Settling Pond Pelton Generator Separator -- Pelton Wheel Pre- Heat Flue Flash Tank H2O Distillate 1 st Effect Manifold 2 nd Effect N Effect Spray-Evap/Settling Pond Flue N-Effect V-Comp Flue Oil Oil 20

21 GEM GPGT TEOR Summary GEM TEOR technology is ready for piloting in Kern County - Half the fuel per bbl steam (v. gas-fired steam generators) - $3-$5 savings per bbl steam (@ $8/Mcf gas) - Establish renewable energy system as co-product - Net-zero carbon footprint (with offset for renewables) Seeking pilot partners / sponsors / Govt. cost share - Revenue sharing amongst stakeholders - Patent-protected technology - Utilize GEM engineering support, studies, and vendor coordination For more information contact: George S. Nitschke, D.Eng., P.E. Good Earth Mechanics, LLC george.nitschke@goodearthmechanics.com Digital Voice: