Enhanced coal bed methane recovery – making CCS more affordable?

The technology may still be in its early stages but enhanced coal bed methane recovery (ECBM) is increasingly being seen as one means of making carbon capture and storage (CCS) cheaper. The captured carbon dioxide (e.g. from a coal powered generating station) is pumped into a coal bed, forcing out the methane which is piped away for sale. The carbon dioxide is then stored in the coal bed. In effect, this is the coal bed methane equivalent of enhanced oil recovery (EOR), whereby carbon dioxide is injected under high pressure into oil reservoirs, increasing the hydrocarbon recovery rate and sequestering the carbon in the reservoir.

This 'dual use' of the carbon dioxide is intended to reduce the costs of a CCS project by setting off against those costs the extra income arising from the enhanced recovery of coal bed methane.

In order for ECBM to work though, there must be certainty that the carbon dioxide store will not contaminate any water supplies and will be securely capped such that it cannot escape into the atmosphere. The water supply consideration is evidently one which is not usually present when considering CCS offshore.

Pilot projects demonstrating ECBM are currently few and far between.

One example is in Fenn Big Valley in Canada, where the Alberta Research Council started in 1999 to inject carbon dioxide into coal beds at cost of Can$ 3.4 million. Testing to date has been reported as being successful and the economics of the project are now being examined to assess its worth for future such ventures.

Another example, also led by the Alberta Research Council, is a joint project with the Chinese Ministry of Commerce and the Canadian International Development Agency. This started in 2003 in the south Qinshui Basin of Shanxi Province in North China and was costed at US$10 million. The aims of this project were to ascertain the viability of storing carbon dioxide in deep, unmineable coal beds and of ECBM via carbon dioxide injection.

At the San Juan basin near Navajo City in New Mexico, a project was launched last year to inject up to 35,000 tons of carbon dioxide in a large coal bed. This project is being progressed by a number of US states led by the New Mexico Institute of Mining and Technology.

The technology is therefore still undergoing testing and if the economics of such projects reveal a big reduction in the cost of CCS, the technology can be expected to be perfected increasingly rapidly.

Once the technology is 'ready to go', what are some of the key legal considerations that might arise?

When obtaining consents for a coal bed methane project, thought should be given to also seeking consent for ECBM and carbon storage. This may be tricky (especially onshore where there is a nervousness about permitting carbon storage 'in my back yard') but if the consenting processes are being undertaken anyway (see our article in the June Edition of the Energy E-Bulletin) then it could well be more efficient to seek those additional consents at the same time. With ECBM, it is likely that consents will be one of the biggest issues facing operators.

Make sure that the providers of kit for the coal bed methane project are under an obligation to ensure, where appropriate, that that kit is also compatible with the technical requirements of an ECBM project. To the fullest extent possible, operators do not want to 'double up' on equipment unless absolutely necessary.

Coal bed methane operators will also want to ensure that their contracts with service providers require those providers to co-operate in the establishment and operation of an ECBM initiative. Operators will also need to ensure that those providers make all necessary information about the coal bed methane project available to operators looking to utilise ECBM and that they cannot hold the operators to ransom.

All in all, ECBM may still be just over the horizon but those involved in coal bed methane projects could be starting to think now about whether ECBM might be provided for in their current plans.

Please contact Richard Cockburn for further information.

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