Apr 26

Study: Fracking Requires a Minimum Distance from Sensitive Rock Strata

By Curve shale gas No Comments »

The chances of rogue fractures due to shale gas fracking operations extending beyond 0.6 km from the injection source is a fraction of 1%, according to new research led by Durham University.

The analysis is based on data from thousands of fracking operations in the USA and natural rock fractures in Europe and Africa.

It is believed to be the first analysis of its type and could be used across the world as a starting point for setting a minimum distance between the depth of fracking and shallower aquifers used for drinking water.

The new study, published in the journal Marine and Petroleum Geology, shows the probabilities of ‘rogue’ fractures, induced in fracking operations for shale gas extraction, extending beyond 0.6 kilometres from the injection source is exceptionally low. The probability of fractures extending beyond 350 m was found to be 1%.

During fracking operations, fractures are created by drilling and injecting fluid into the rock strata underground to increase oil and gas production from fine-grained, low permeability rocks such as shale. These stimulated fractures can significantly increase the rate of production of oil and gas from such rocks.

Fracking operations in the USA are growing in number and many countries across the world are looking at shale gas as a potential energy resource. The process of fracking has come under increasing scrutiny. A recent test well in the UK near Blackpool, Lancashire, was stopped after some minor earthquakes were felt at the surface. The UK government is allowing the test fracking to resume but critics have also warned of other possible side-effects including the contamination of groundwater.

Researchers from Durham University, Cardiff University and the University of Tromsø looked at thousands of natural and induced fractures from the U.S., Europe and Africa. Of the thousands artificially induced, none were found to exceed 600 m, with the vast majority being much less than 250 m in vertical extent.

Fracture heights are important as fractures have been cited as possible underground pathways for deep sources of methane to contaminate drinking water. But the likelihood of contamination of drinking water in aquifers due to fractures when there is a separation of more than a kilometre is negligible, the scientists say.

Professor Richard Davies, Director of Durham Energy Institute, Durham University, said: “Based on our observations, we believe that it may be prudent to adopt a minimum vertical separation distance for stimulated fracturing in shale reservoirs. Such a distance should be set by regulators; our study shows that for new exploration areas where there is no existing data, it should be significantly in excess of 0.6 km.

“Shale gas exploration is increasing across the world and sediments of different ages are now potential drilling targets. Constraining the maximum vertical extent of hydraulic fractures is important for the safe exploitation of unconventional hydrocarbons such as shale gas and oil, and the data from the USA helps us to understand how fracturing works in practice.

“Minimum vertical separation distances for fracturing operations would help prevent unintentional penetration of shallow rock strata.”

Professor Davies’ team looked at published and unpublished datasets for both natural and stimulated fracture systems in sediment of various ages, from eight different locations in the USA, Europe and Africa.

Professor Richard Davies said: “Sediments of different types and ages are potential future drilling targets and minimum separation depths are an important step towards safer fracturing operations worldwide and tapping into what could be a valuable energy resource.

“We need to keep collecting new data to monitor how far fractures grow in different geological settings.”

The team accepts that predicting the height and behaviour of fractures is difficult. They now hope that the oil and gas industry will continue to provide data from new sites across the globe as it becomes available to further refine the probability analysis.

Analysis of new sites should allow a safe separation distance between fracking operations and sensitive rock layers to be further refined, the scientists say. In the meantime, the researchers hope that governments and shale gas drilling companies will use the analysis when planning new operations.

Source: Natural Gas for Europe

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Apr 24

Energy Majors Bid for Ukraine Shale Gas Fields

By Curve natural gas in Europe No Comments »

 

Global energy majors have placed bids in tenders for two potentially large shale gas fields in Ukraine, Environment and Natural Resources Minister Eduard Stavitsky said on Monday, adding that the government would pick winners in a month.

One contract area, Yuzovska, is located in the eastern Donetsk and Kharkiv regions. The other, Olesska, is in the western Lviv region.

Ukraine’s State Geological Service estimates the reserves of the Yuzovska area at 2 trillion cubic metres and those of Olesska at 0.8 to 1.5 trillion cubic metres.

“Chevron CVX.N> and Eni have bid for Olesska (contract area),” Stavitsky told reporters. “Exxon Mobil , Shell and TNK-BP for Yuzivska.”

“The final decisions (will be announced) no later than 1800 on May 23, 2012,” he said.

According to the U.S. state Energy Information Administration, Ukraine has Europe’s fourth-largest shale gas reserves at 42 trillion cubic feet (1.2 trillion cubic metres), trailing Poland, France and Norway.

The State Geological Service has also said the Yuzovska area would require $250-$300 million in exploration investments, while Olesska would need $150-$200 million. Tender application fees were $1.9 million for Yuzovska and $1.3 million for Olesska.

Energy-hungry Ukraine is keen to launch shale gas production in order to ease its dependence on Russia, which it says is charging an exorbitant price for its gas.

Source: Reuters

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Apr 24

PGNiG Needs Polish Shale Potential Clear by 2019

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Poland needs to be clear on its shale gas potential by 2019 to let its gas monopoly PGNiG decide on future supplies from Russia’s giant Gazprom beyond the current deal expiring 2022, PGNiG head was quoted on Tuesday as saying.

Poland, the largest economy in the eastern wing of the European Union, is eager to develop shale industry on its soil as it is struggling to modernise its coal-intensive economy and curb its reliance on Russian gas supplies.

“It’s very important that by 2019, that is three years before the Gazprom contract expires, we know how much shale we are able to produce domestically from conventional sources and, first and foremost, shale gas,” tabloid Super Express daily quoted Grazyna Piotrowska-Oliwa as saying.

“Then we will have to make a decision on what next with imported gas,” the newly-elected chief executive told a Super Express debate on Apr.13, according to the paper.

Poland has granted more than 100 exploration licences to its state-controlled companies as well as global majors such as Chevron or Exxon Mobil as it estimates its shale reserves at 346 to 768 bcm.

The EU’s largest ex-communist member consumes 14 bcm of gas annually with imports at nearly 10 bcm, most of it from Russia.

Source: Reuters

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Apr 24

Polish Shale Gas Co-op Grows, Hits Delay

By Curve Poland No Comments »

 

Poland’s No. 3 utility Enea has joined a group of state-controlled companies looking to invest in shale gas development, gas delivery monopoly PGNiG said on Tuesday.

PGNiG, which holds the rights to explore a potentially promising shale gas basin in northern Poland, has already had separate talks with utilities PGE and Tauron and copper miner KGHM about some form of co-operation.

“The companies decided that mutual co-operation on the Wejherowo licence will be more effective,” PGNiG said in a statement.

It delayed the conclusion of the discussions to June from the end of this month.

Enea was unavailable for comment.

In February, the group denied a report it would to team up with Poland’s top oil refiner PKN Orlen, which also holds shale gas exploration licences, in the search for the unconventional gas.

Poland, the largest economy in the eastern part of the European Union, is eager to develop shale industry to modernise its coal-intensive economy and curb its reliance on costly Russian gas supplies.

Poland has granted more than 100 exploration licences to its state-controlled companies as well as global majors such as Chevron and Exxon Mobil.

It has estimated its shale reserves at 346 to 768 billion cubic metres (bcm).

The head of PGNiG, which controls 15 exploration licences, was quoted by a local newspaper as saying that it would need to know the full potential of shale gas in Poland by 2019 to decide on future supplies from Russia’s Gazprom.

Its current contract expires in 2022.

The EU’s largest ex-communist member consumes 14 bcm of gas annually with imports at nearly 10 bcm, most of it from Russia.

Source: Reuters

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Apr 18

Britain May Become Major Global Shale Gas Producer, Alongside China And U.S.

By Curve shale gas in Europe No Comments »

 

The United Kingdom may have enough offshore shale gas to propel it into the top tier of global producers, making the country energy self-reliant, analysts have predicted.

Reserves of the hard to extract, “unconventional” gas deposits could exceed 1,000 trillion cubic feet, experts now believe, ranking the UK alongside China, the U.S. and Argentina, according to Reuters.

The news comes as a UK government report on Tuesday backed the exploration of shale gas using the controversial hydraulic fracturing, or “fracking,” drilling method blamed for two small earthquakes in Britain last year.

“There will be a lot more offshore shale gas and oil resources than onshore,” Nigel Smith, subsurface geologist and geophysicist at the British Geological Survey, told Reuters.

“We were pioneers in the North Sea with conventional oil and gas, and the technology has gone around the world, so why not become one in the unconventional sector,” Smith said.

He added that UK offshore reserves could be five to 10 times as high as those found onshore, enabling the UK to become energy self-sufficient.

Experts have cautioned, however, that whatever the final reserve figure is, only around 10 to 20 percent will actually be recoverable.

The use of fracking to extract shale gas is an extremely expensive and relatively new technology, pioneered in the United States and Canada over the last 20 years.

Fracking uses explosives and vast quantities of heavy “mud’ — a mixture of chemicals, dense material such as ceramic and water — to open up cracks in reservoir rocks, allowing trapped gas to escape through an oil well and reach the surface.

It has been blamed for contaminating water supplies and causing earthquakes, and it has been banned in parts of the U.S. and Canada pending further investigation.

The practice has also recently been banned in France and Bulgaria.

Despite the setbacks, engineers say Europe is poised to uncover vast reserves of shale gas that stretch across the continent.

“We have potentially huge volumes present in the subsurface — the volumes are mind-blowingly big,” Melvyn Giles, global head of unconventional gas and light tight oil at Shell, told Reuters.

“The figures appear to suggest the shale resources are so large that the question is not how much is out there, but how much can be retrieved — how much can be economically accessed in an environmentally acceptable way,” he added.

Source: Reuters via Nasdaq

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Apr 18

Shale Gas Fracking Gets Green Light in Britain

By Curve shale gas in Europe No Comments »

 

A UK government report on Tuesday backed the exploration of shale gas, which has transformed the U.S. energy market, nearly one year after temporarily banning the drilling method because it had triggered two small earthquakes in Britain.

An expert report commissioned by the government said it was safe to resume fracking, in which pressurised water and chemicals are pumped underground to open shale rocks and release trapped gas, but with tighter rules on seismic monitoring and drilling surveys.

“The risk of seismic activity associated with hydraulic fracking operations is small, and the probability of damage is extremely small. We suggest fracking can continue under our recommendations,” one of the report’s authors, the British Geological Society’s Brian Baptie, said at a briefing.

Activists on both sides of the Atlantic have lobbied politicians to ban hydraulic fracturing also on environmental concerns, including the dangers of pollution of ground water and leakage of gas into the atmosphere. The report did not address those concerns.

The energy ministry is inviting public comment on the report’s findings over the next six weeks, after which it will issue its final ruling on the future of UK shale gas exploration.

The experts published their findings after reviewing a series of post-earthquake studies published by Cuadrilla Resources, a UK firm that was forced to halt operations near Blackpool in northwest England after fracking triggered tremors in May 2011.

They also recommended the use of a “traffic light” control system, in which operations are suspended if a red light indicates seismic activity at a threshold of 0.5 or above, well below a level that could cause structural damage on the surface.

The tremors measured near Blackpool last year reached a level of around 2 .

UK engineers welcomed the report’s safety recommendations, and the “traffic light” warning system in particular.

“These proposed precautions are a good example of how to help mitigate the risk of any damage caused by seismic activity as a result of shale gas activity,” Tim Fox, head of energy and environment at the Institution of Mechanical Engineers, said in a statement.

While the experts agreed with Cuadrilla’s studies as a whole, they also said there was not enough data to confirm the company’s claim that it was unlikely similar earthquakes would recur.

Environmental group Greenpeace said the support for fracking to go ahead was “bad news”, saying hydraulic fracturing could pose a threat to efforts to diversify away from fossil fuels.

“This would … be a major blow for the British renewable energy industry, which would see investment hijacked by a new dash for gas,” Joss Garman, Greenpeace’s senior energy campaigner, said.

France, which has some of Europe’s largest shale gas reserves, last year banned the use of fracking on worries about environmental damage.

However, shale gas exploration is seen by some as a positive force in the battle against climate change since the gas releases less carbon into the atmosphere than coal when used to produce electricity.

“Provided safety standards are observed, shale gas could unlock significant new infrastructure investments, help meet our carbon reduction goals and create many new jobs around the UK,” a representative of the Confederation of British Industry said in response to the government’s fracking report.

In the UK, Cuadrilla has said its site near Blackpool had 200 trillion cubic feet of gas in place, enough to cover UK demand for generations, although experts have cast doubt on the claims.

In the United States the exploration of shale gas has pushed gas prices to 10-year lows, and companies such as Cheniere Energy are gearing up to export the excess fuel.

British gas prices would also come under increasing pressure if UK shale gas exploration were to take off, a representative of British energy supplier npower wrote on the company’s energy blog.

Source: Reuters

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Apr 12

Putin Fears Shale Gas Competition

By Curve natural gas in Europe, Poland No Comments »

 

In one of his final acts as Russian Prime Minister, President-elect Vladimir Putin has spoken out on the issue of shale gas exploration – something that poses a potential threat to the Russian economy should Poland become self-sufficient in terms of energy production:

Russian Prime Minister Vladimir Putin has urged his country’s gas industry to “rise to the challenge” of shale gas as the United States and some European countries forge ahead with developing the energy source.

US shale gas production may “seriously” restructure supply and demand in the global hydrocarbons market, Putin said yesterday in his final address to the Russian Duma before he takes over as president on 7 May.

Putin said Russia must be prepared for “any external shocks” and “a new wave of technological change” that was “changing the configuration of global markets”.

Source: Canada Free Press

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Apr 05

UK Shale Deposits Twice as Large as Previously Thought: IGas

By Curve natural gas in Europe No Comments »

 

UK company IGas says shale gas deposits at its site in north-west England could be more than twice as large as it previously estimated, according to its latest operational update.

The company says that its latest analyses of its well at Ince Marshes could potentially at least double the pre-drilling estimate of 4.6 trillion cubic feet.

Taking the “very encouraging” results, together with indications of similar deposits in neighbouring Bowland Shale, could see the UK’s resources exceed those of elsewhere in Europe.

“The UK government’s announcement about a new gas generation strategy and the support given in the budget to the industry are all signs that UK sourced hydrocarbons are going to play an increasingly important role in the future energy mix of the country,” says Andrew Austin, CEO of IGas.

The company says it is now looking for suitable partners to undertake further drilling and development of shale gas.

“Following a number of enquiries from interested parties, we are now launching a process to engage a suitable farm-in partner to participate in drilling further wells to corroborate these results and to develop our shale resource,” the company said in a statement.

Source: Energy Efficiency News

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Apr 03

EU Parliament Draft Motion Supports Shale Gas Development in Europe

By Curve natural gas in Europe No Comments »

 

In a report obtained by Natural Gas Europe, the Committee on Industry, Research and Energy recommends the European Union to support assessing, exploring and developing shale gas reserves in Europe.

The draft motion for a European Parliament Resolution, prepared under supervision of the rapporteur Niki Tzavela (Greek MEP representing Europe of Freedom and Democracy political group), underlines the importance of promoting openness, monitoring and use of best practices.

According to the draft report, gas is a quick and cost-efficient way of reducing reliance on other fossil fuels – especially coal, still extensively used in some member states, including Poland.

By helping to lower greenhouse gas emissions and backing up renewables, gas may become a “bridge fuel”, leading the European Union towards the transformation of the energy system outlined by the Roadmap 2050 initiative.

The draft report also explicitly states that shale gas production will increase security of supply in Europe. The committee observes the growing role of natural gas as the source of energy and the role of shale gas production in ensuring energy security and diversity.

The document, obtained by NGE, notes the impact made by the shale gas boom in the US on global gas market, pays special attention to increasing gas-to-gas competition and underlines strengthening position of customers vis-à-vis gas suppliers.

With a view to taking full advantage of possible shale gas production, it also stresses the importance of interconnected and integrated energy market, calling on the European Commission and member states to enforce requirements of the EU third energy package.

The report states that although various estimates have been made, all of them point to the existence of a large indigenous energy resource in Europe.

The document encourages states to assess and map those resources and asks the European Commission to engage in determining the level of shale gas reserves, by combining results from reports prepared by member states and results from exploration projects.

According to the draft motion, member states should be urged to train labour force, by introducing the necessary skills into their mainstream education and training systems.

Importantly, the report notes the significance of establishing the necessary infrastructure, mentioning not only pipelines, but also roads. It also calls for further research and development into tools and technologies.

In the view of the authors, at the current stage of exploration works, the regulatory framework for licensing in the EU is adequate.

However, they propose to the EU Parliament to call on member states to ensure they put in place all the necessary administrative and monitoring resources for the further development of shale gas, by checking and improving – if necessary – their regulatory frameworks for future commercial scale production.

At the same time, the committee points out, that some member states did not hold public consultations during authorization phase, and it calls governments to provide proper transparency in this aspect.

The document recalls conditions that paved the way to the shale gas boom in the United States and pays special attention to the role of EU-US cooperation.

Comparing conditions for shale gas development in Europe and the United States, the committee observes, that it will certainly take time to build an adequate capacity for the large scale production, because of the lack of a sufficient number of rigs, necessary manpower and well-equipped and experienced service industry in Europe.

Therefore, the committee recommends to the European Parliament to encourage cooperation between European and American companies and to urge the exchange of best practices and information between different level administration in the EU and the US.

The committee observes, that unlike American landowners, European farmers do not own underground resources and thus do not benefit from extraction. Thence, it underlines the necessity for building relationships with locals and calls on shale gas companies to ensure, that communities will benefit from the shale gas development.

The EU Parliament motion would also call for better public information, declare the EU support for creation of portals providing access to wide range of data, and urge companies to provide full information, including disclosure of the chemicals, they intend to use in  fracturing operations.

The draft stresses, that operators should reduce flaring and venting and restore land used.

It also highlights the need for establishing minimum safety standards and organizing inspections, especially during stages of well construction and hydraulic fracturing.

Finally, the Committee on Industry, Research and Energy recalls, that according to the polluter – pays principle, companies would be liable for any damages.

As Natural Gas Europe learned, amongst proposed amendments to the motion, there is an invitation to introducing pressure testing of cement casing, testing of  wells before and during operations, and publication of the sesults of those examinations.

Source: Natural Gas for Europe

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Apr 02

Prospective Resources Estimates Announcement

By Curve San Leon Energy No Comments »

 

San Leon Energy, the fast growing oil and gas company with an extensive portfolio of assets across Europe and North Africa, notes this morning’s announcement from Longreach Oil & Gas Ltd (Longreach), updating on the independently evaluated resource estimates for the Foum Draa and Sidi Moussa licences, offshore Morocco, by Netherland, Sewell & Associates Inc. San Leon owns a 42.5% net operated interest in these licences.

The full announcement by Longreach stated the following:

Prospective Resources Estimates

Longreach is pleased to announce prospective resource estimates for offshore licences Foum Draa and Sidi Moussa, independently evaluated for the Company by Netherland, Sewell & Associates Inc. (NSAI), in accordance with NI 51-101 disclosure requirements.

NSAI have estimated unrisked prospective resources, as of 31st December 2011 for 14 identified prospects and 8 additional leads located in the Foum Draa and Sidi Moussa licences, offshore Morocco. The prospects are Triassic to Paleocene in age and there are a variety of trapping mechanisms such as tilted fault blocks, stratigraphic pinch outs and salt related traps over and against salt diapir flanks. The reservoir rock types are mainly sandstones, but there is also a shelf edge Jurassic carbonate play.

Unrisked prospective resources have been estimated as follows:

Unrisked Prospective Resources

Gross (100 Percent)

Longreach Gross Interest¹

Oil

Gas

Oil

Gas
Category

(MMbbl)

(Bcf)

(MMbbl)

(Bcf)
Low Estimate

751.7

302.9

56.4

22.7
Best Estimate

2138.8

1008.5

160.4

75.6
High Estimate

6105.3

3145.3

457.9

235.9

¹ Figures calculated net of ONHYM’s 25% back in, giving Longreach with a 7.5% working interest

Unrisked prospective resources are the arithmetic sum of multiple probability distributions. Longreach owns a 7.5% interest in these prospects and leads. A copy of NSAI’s report has been filed on SEDAR.

A dataroom to attract industry partners ahead of commencing a drill campaign was opened on 22nd February and will remain open until 4th May 2012. 18th May has been set as a date for receiving note of Interests from prospective farminees, with final bids to be received by 15th June 2012.

Commenting, Bryan Benitz, Chairman and CEO of Longreach, said:

 

“Management believes that these unrisked prospective resource estimates reinforce the excellent work that Technical Operators, Serica Energy have done on these licences over the past two years and demonstrate the significant potential these licences have. The largest identified prospect, Apricot, is a stratigraphic pinch out play concept with dual target potential. NSAI’s report states the best estimate of unrisked prospective resources to be 584 MMbbls and 350 Bcf for this dual target prospect, which management believes is significant in its own right.

 

The dataroom has already attracted significant interest and we look forward to concluding this process in June.”

Source: San Leon Energy

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