PAST, PRESENT, AND FUTURE OF COAL BED METHANE IN THE ROCKY MOUNTAINS

Based on a workshop cosponsored by PTTC’s Rocky Mountain Region on June 22, 1999, in Denver, CO.

BOTTOM LINE

After 10 years, new technologies continue to increase both interest and production in previously discovered coal bed methane (CBM) plays. These technologies, plus the discovery of new CBM resources, and plays, continue to attract new players to a number of Rocky Mountain basins.

PROBLEM ADDRESSED

Coal bed methane (CBM) development in the Rocky Mountains region, initially hampered by a general lack of technical knowledge and supportive infrastructure, grew from a modest level of activity over a decade ago to a current level that surpasses most conventional oil and gas activities in many basins. A large CBM resource base remains as a target for continued exploration and development by operators willing to learn and apply the technologies that have proven successful.

KEY WORDS:

Coal Bed Methane, Cavitation Completions, Surface Modification Agents, Aeromagnetic Surveys, Resource Base

SPEAKERS

Coalbed Methane Overview in the Rocky Mountains
Stephen D. Schwochow, geological consultant

Emerging Resources and Technologies
Vello A. Kuuskraa, Advanced Resources International, Inc.

Environmental/Permitting Issues
Randy Schroeder, Greystone Environmental Consultants

Future Coal Bed Methane Plays
Andrew R. Scott University of Texas, Bureau of Economic Geology 

TECHNOLOGY OVERVIEW

At the end of the Section 29 tax credit era, the growth rate and— continued growth potential— for CBM in the Rocky Mountains has been phenomenal. In 1985, less than 10 bcf of CBM were produced nationwide. By 1996, that number had grown to over 1,000 bcf, representing 6% of total US natural gas production. Of the more than 675 tcf of CBM estimated to exist in the US, over 80% is located in Rocky Mountain basins. Thousands of new wells are planned, and CBM activity is at an all-time high in the area.

New technologies and knowledge gained from experience are mainly responsible for this trend. New methods were developed for drilling, logging and geophysical interpretation, fracturing designs, and well completion (including highly successful dynamic open-hole cavitation completions), and enhanced recovery technologies for CBM. Also contributing to this trend are CBM simulators, an improved understanding of the physics and chemistry of CBM reservoirs, and the addition of numerous pipelines which relieved the delivery problem that limited production in the early years of CBM development in the region.

Currently, the most active CBM play in the US is in Wyoming’s Powder River Basin. Here, good access, low risk, and general simplicity are the keys to success in producing from Fort Union formation coals. More than 500 producing wells raised production from 12.9 bcf in 1997 to more than 24 bcf in 1998. More than 3,000 permits have been approved for additional wells to be drilled by over 40 companies. Specially processed aeromagnetic data— coupled with topographic analysis, subsurface data, and well production data— have helped locate and rank critical natural fracture and isopach trends to enhance CBM success.

The San Juan Basin in northwestern New Mexico, where production has climbed to 974 bcf, is the undisputed world leader in CBM production. Detailed geological studies have contributed greatly to understanding the character and distribution of the Fruitland coals. Production is expected to continue to climb as existing wells are optimized, closer spaced infill wells are drilled, and pipeline and gas plant facilities continue to expand. New well stimulation technologies employing surface modification agents— which effectively enhance permeability of the sand proppant pack to water by 30 to 35%, while preventing coal fines from plugging its pores— are revitalizing existing wells. The desorption of gases and reservoir permeability are expected to continue increasing as reservoir pressures fall accompanying water production, and these factors, along with application of enhanced recovery techniques employing CO ₂ and nitrogen, should also contribute to sustain production for some time to come.

The Uinta Basin in northeastern Utah is the second-largest Rocky Mountain basin for producing CBM. Production in 1998 was more than 32 bcf, up 41% over 1997 levels. Production is mainly from the coals associated with the Ferron sandstone. In reservoirs like that at Drunkard's Wash, biogenic gas from the interaction of meteoric waters with shallower coals adds to thermogenic gas migrated upward from deeper Ferron coals. Northward in the basin, shallower coals of the Blackhawk formation also contribute.

In the Raton Basin in northeastern New Mexico and southeastern Colorado, the lack of pipeline connections stalled development for more than 20 years. Two new lines have been installed since 1994. Approximately 100 wells were drilled in 1998 in two new fields, which contributed to production of 20 bcf that year. Wells are typically drilled in a single day to depths of 750 to 1,800 ft and stimulated using sand, gelled water, and nitrogen.

The Piceance Basin in northwest Colorado is one of the few basins in which CBM production, mostly from coals within the Mesaverde group, declined from 1997 to 1998. However, specialized completion techniques, magnetic surveys, and remote sensing methods— in addition to well data to locate basement structures with associated tectonic fracturing— may make deeper resources more accessible.

Accompanying the rapid growth of CBM activity in the Rockies are a variety of environmental, permitting, and other issues not encountered in conventional oil and gas operations. Problems are related to the ownership of gas versus associated coal resources, and the large-scale, cumulative impact of multiple and sizable CBM projects in areas where oil and gas operations have not yet been implemented.

Despite these challenges, the future looks bright for CBM in the region. There are ample reserves to pursue in a number of basins. Because of these reserves and good expectations for (1) continued development of new technologies for enhanced recovery; (2) cost-effective drilling of wells with multiple horizontal laterals; and (3) expansion of resource limits by locating and developing gas in thinner seams, seams of lower rank, and at greater depths.

LESSONS LEARNED

Much has been learned about CBM reservoirs in the past decade. Operators understand that access to adsorbed methane is through fracture systems. On a fundamental level, gas and water move through the natural cleats that form during the coalification process. Production of water reduces reservoir pressure and allows additional gas to desorb into the fluid filling the fractures and move to the wellbores. Larger scale fractures (induced or natural) relieve stress on the coals and allow the cleats to remain open, which effectively increases reservoir permeability. Regional studies of coal depositional geology and structural regime are necessary to locate optimum reservoir quality.

With its rapid growth in areas previously unaffected by oil and gas activities— and with its unique relationship to coals, a resource whose ownership has already been assigned in many areas— CBM activity has raised a number of issues relating to the environment, permitting, and ownership. The petroleum industry has resolved many of these issues and, fortunately, is well on the way to address some of the thorny issues that remain. However, new issues can be expected to arise as CBM activity spreads to more plays in unexplored/ undeveloped areas.

CONNECTIONS:

Stephen D. Schwochow, Geological Consultant
16485 W. 12th St.,
Golden, CO 80401-2816
Phone/ Fax 303-279-9401 E-mail firedamp@aol.com

Vello A. Kuuskraa, President
Advanced Resources International, Inc.
1110 N. Glebe Rd., Suite 600, 
Arlington, VA 22201
Phone 703-528-8420; Fax 703-528-0439 E-mail ari-info@adv-res.com

Randy Schroeder, General Manager
Greystone Environmental Consultants
600 Dart Rd., PO Box 177,
Mason, MI 48854-0177
Phone 517-676-2900; Fax 517-676-5887 E-mail greystone@greystone-consultants.com

Andrew R. Scott
University of Texas, Bureau of Economic Geology
University Station, Box X,
Austin, TX 78713-2924
Phone 512-471-0359; Fax 512-471-0140; E-mail scotta@begv.beg.utexas.edu

For information on PTTC’s Rocky Mountain Region and its activities contact:
Sandra Mark, PTTC Resource Center Director,
Colorado School of Mines, Golden CO, 80401-1887
Phone 303-273-3107, Fax 303-273-3859, E-mail smark.95@alum.mines.edu

Disclaimer: No specific application of products or services is endorsed by PTTC. Reasonable steps are taken to ensure the reliability of sources for information that PTTC disseminates; individuals and institutions are solely responsible for the consequences of its use.

The not-for-profit Petroleum Technology Transfer Council is funded primarily by the US Department of Energy’s Office of Fossil Energy, with additional funding from universities, state geological surveys, several state governments, and industry donations.

Petroleum Technology Transfer Council, 2916 West T. C. Jester, Suite 103, Houston, TX 77018
Toll-free 1-888-THE-PTTC; Fax 713-688-0935; E-mail hq@pttc.org; web www.pttc.org