Report Offers Commodity Updates

The AAPG Energy Minerals Division covers many scientific disciplines and interests – and because previous EXPLORER articles featured shale gas and oil shale, this quarter will focus on highlights from this year’s EMD November Mid-Year Meeting Commodity Reports.

Detailed reports can be found on the EMD Members website.

(Are you interested in the details, but not yet an EMD member? Upgrade your membership today – at no additional cost to AAPG members – for online access to our research and reports.)

EMD also is updating its website, with many improvements to come in the months ahead. So please, excuse our dust during this transition.

♦ Uranium and Nuclear Minerals: Nuclear power production is forecast to remain steady at about 18-20 percent of electricity generation (EIA). Yellowcake price futures are favorable for increase as plant construction plans to develop in Southeast Asia and China and exploration targets emerge in India, Africa, Australia and South America.

U.S. uranium production in Q3 2012 was 1,048,018 pounds U3O8, down 1 percent from Q2 but up 24 percent from Q3 2011.

As uranium prices rise and geopolitical developments evolve, these factors will serve to enhance the economic potential for recovering both rare-earth elements and uranium.

♦ Gas Hydrates: The Ignik Sikumi test, which was a 60-day or so gas hydrate exchange trial carried out in Alaska’s Prudhoe Bay Field in early 2012, was the first-ever field trial of methane hydrate production. CO2 was exchanged in situ with methane molecules resulting in methane gas and CO2 hydrate.

Other updates include an LWD drilling program offshore India (late 2012) targeting reservoir delineation and resource assessment of hydrate-bearing sands, and a gas hydrate production test in the Nankai area offshore Japan planned for early 2013. 

♦ Oil (Tar) Sands: The EMD-sponsored AAPG Studies in Geology 64, titled “Heavy Oil and Oil Sand Petroleum Systems in Alberta and Beyond,” will be published this month. Also, the upcoming AAPG Annual Convention and Exhibition in Pittsburgh will feature a poster session dedicated to tight oil sands.

Alberta production of upgraded bitumen passed 1.6 million barrels per day; and the ratio of surface-mined to in situ production changed from 60/40 in 2007 to 55/45 in 2009 to nearly 50/50 in 2012.

Current technology development focuses on alternative methods of recovery, including combinations of existing and developing technology, alternative sources of energy for steam production and reducing environmental impacts of surface extraction. 

♦ Tight Gas Sands: The boundary between tight gas sand and gas shale, reflected in silty shale, siltstone and intimately interbedded sandstone/siltstone/ shale formations, makes it difficult to define some plays as tight gas sand or shale gas plays. Our EMD committee is expanding its focus beyond the Americas and is looking at global advances, with current interest in China. 

♦ Shale Oil and Oil Shale: Total global production of shale oil is currently about 30,000 barrels per day (BOPD). American Shale Oil has restarted a pilot of its in situ process, and Shell is developing a test program on a multi-mineral Research, Development and Demonstration (RD&D) lease in western Colorado.

The U.S. Bureau of Land Management announced the award of two RD&D leases in Colorado to ExxonMobil and Natural Soda Holdings Inc.

In international news, a May 2012 Jordanian oil shale symposium highlighted recent devel­opments and focused attention on large deposits in the Middle East, and Eesti Energia has begun production from its Enefit 280 retort system in Estonia, which adds about 5,000 BOPD in production.

♦ Shale Gas and Liquids: International production of shale gas largely has been in Canada, benefitting from the U.S. boom, but testing also is under way in Europe (U.K., Poland) and Asia (China, Australia, India, New Zealand and Japan).

Recent U.S. highlights include:

  • Bakken oil production in North Dakota exceeded 700,000 BOPD by year-end 2012.
  • Eagle Ford oil production averaged >300,000 BOPD in April, and since varies from 325,000-350,000 BOPD.
  • Barnett Shale production peaked in May 2011 at 5.87 BCF/D.
  • Haynesville Shale production has declined after a 2012 peak.

Rig counts have decreased steadily in most plays due to commodity price, even as drilling in liquids-rich plays has increased. 

♦ Coal: The latest released data shows total coal distribution in 2011 was 1,080.8 million short tons (mmst), an increase of 0.02 percent from the previous year (EIA, 2012). Distribution to domestic destinations accounted for 973.6 mmst, a 2.5 percent decrease compared to 2010, whereas distribution to foreign destinations, which was 107.3 mmst, increased by 31.3 percent over 2010.

In April 2012, net electric generation from natural gas was 95.9 million megawatt hours, almost equal to that from coal (96.0 million megawatt hours). 

♦ Geothermal: The U.S. Geological Survey’s public domain geothermal database is going forward, and TGS-Nopek is compiling a bottom-hole temperature database with a focus on the west Texas Delaware Basin.

March 12-14, Southern Methodist University in Dallas will hold its geothermal conference titled “Geothermal Energy and Waste Heat to Power: Utilizing Oil and Gas Plays,” focusing on geothermal in oil and gas producing areas.

Upcoming EMD events:

EMD is co-sponsor of two upcoming events with the Division of Environmental Geoscience (DEG):

Solving Water Problems in Oil and Gas Production: New Technologies for Cost Savings and New Revenue Streams is a Geoscience Technical Workshop (GTW) planned for Feb. 26-27 in Fort Worth. (See story.)

“Protecting Assets with Environmental Baseline and Ground-Water Monitoring” is a short course to be held during the AAPG Pacific Section Meeting in Monterey, Calif., in April.

EMD also is gearing up for the AAPG ACE in Pittsburgh May 19-23. We have an exciting program planned – seven oral and five poster sessions, two short courses/workshops, three field trips, and a luncheon featuring Seamus McGraw, author of “End of Country.”

Watch our article in the May EXPLORER for more details.

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Division Column-EMD

Division Column-EMD Jeremy Boak
Jeremy Boak, P.G., EMD President 2013-14.

Division Column-EMD Andrea Reynolds

Andrea A. Reynolds, P.G. EMD President 2012-13.

Division Column-EMD

The Energy Minerals Division (EMD), a division of AAPG, is dedicated to addressing the special concerns of energy resource geologists working with energy resources other than conventional oil and gas, providing a vehicle to keep abreast of the latest developments in the geosciences and associated technology. EMD works in concert with the Division of Environmental Geosciences to serve energy resource and environmental geologists.

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See Also: Book

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We use samples from undeformed and deformed sandstones (single deformation band, deformation band cluster, slip-surface cataclasite, and fault core slip zone) to characterize their petrophysical properties (porosity, permeability, and capillary pressure). Relationships between permeability and porosity are described by power-law regressions where the power-law exponent (D) decreases with the increasing degree of deformation (strain) experienced by the sample from host rock (D, sim9) to fault core (D, sim5). The approaches introduced in this work will allow geologists to use permeability and/or porosity measurements to estimate the capillary pressures and sealing capacity of different fault-related rocks without requiring direct laboratory measurements of capillary pressure. Results show that fault core slip zones have the highest theoretical sealing capacity (gt140-m [459-ft] oil column in extreme cases), although our calculations suggest that deformation bands can locally act as efficiently as fault core slip zones in sealing nonwetting fluids (in this study, oil and CO2). Higher interfacial tension between brine and CO2 (because of the sensitivity of CO2 to temperature and pressure) results in higher capillary pressure and sealing capacity in a brine and CO2 system than a brine and oil system for the same samples.
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The search for unconventional hydrocarbons is not new. It’s true that almost 100 years separated the early exploration successes in the synclinal valleys of Central Pennsylvania, to the exploitation of Coal-Bed Methane in a number of basins in the U.S. and Canada in the 1980’s. Since the 1980's, however, a quiet revolution began which by today has seen several waves of unconventional resources being pursued with economic success. Coal-bed methane was followed by the search for Center-Basin Gas, Shale Gas and most recently, Liquid-rich Shales (some of which aren't shales).

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The goal of this e-symposium is to provide an overview of the latest trends and technologies for water management for oil and gas drilling, completions, and production.

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