Wyoming CO2 Status and Developments

E N H A N C E D O I L R E C O V E R Y I N S T I T U T E

Wyoming CO2 Status and

Developments

P R E S E N T A T I O N T O T H E 6 T H A N N U A L W Y O M I N G

C O 2 C O N F E R E N C E , J U L Y 1 1 T H , 2 0 1 2

Glen Murrell Ben Cook, Vandy Jones, Nick Jones


• Status

• Industry Stakeholders

• Developments

• Supply

• Project Summary

• State-wide Summary

• CO2 Balance

Agenda


340 MMcfd

~35 MMcfd

~40 MMcfd

~35 MMcfd

~30 MMcfd

~115 MMcfd

Contracted Quantities

~50 MMcfd to Denbury (Grieve).

Current Situation Greencore Pipeline Under construction


Riley Ridge

(130-600 MMcfd) + pipeline

Carbon Energy UCG DKRW Advanced Fuels /

Med Bow F&P (200 MMcfd)

Linc Energy UCG and Glenrock area projects

Lost Cabin (50 MMcfd)

Future Projects


Producers:

Carbon Energy - Supplier, UCG operation in Green River Basin.

Supply volume unknown. Contracted supplier to Anadarko Petroleum.

ConocoPhillips - Supplier, owner of Lost Cabin Gas Plant. Contracted

to supply ~ 50 MMcf/d to Denbury.

ExxonMobil - Supplier, owner and operator of Shute Creek facility,

providing ~ 340 MMcf/d CO2 to various clients. Pipeline operator.

Medicine Bow Fuel & Power (DKRW-AF) - Potential supplier, Coal to

Liquids plant in Hanna Basin. Potential for supply of ~ 200 MMcf/d.

Contracted supplier to Denbury Resources.

Market Participants


Consumers:

Anadarko Petroleum Corporation - Operator of Salt Creek and

Monell projects, taking ~ 155 MMcf/d from ExxonMobil. Distribution

pipeline operator.

Chevron - Consumer, operator of Rangely field, taking ~ 35 MMcf/d

from ExxonMobil. Distribution pipeline operator.

Devon Energy - Consumer, operator of Beaver Creek field, taking ~

35 MMcf/d from ExxonMobil. Distribution pipeline operator.

Elk Petroleum - Consumer, JV partner in Grieve Field. In JV

partnership with Denbury Resources.

Merit Energy - Consumer, operator of Lost Soldier/Wertz fields, taking

~ 30 MMcf/d from ExxonMobil. Distribution pipeline operator.

Market Players


Integrated Business Models:

Linc Energy - UCG operation in Powder River Basin. Supply volume

unknown. Future CO2 EOR operator of three fields near Casper.

Denbury Resources - Operator of Bell Creek and other fields. Owner

of Riley Ridge (130 MMcf/d initially). Contracted for ~ 50 MMcf/d from

Lost Cabin (ConocoPhillips). Contracted for ~ 50 MMcf/d from Labarge

(ExxonMobil). Contracted for ~ 100 MMcf/d from Medicine Bow Fuel &

Power (DKRW Advanced Fuels). Building 20” Greencore pipeline.

Market Players


• Ongoing research program investigating nature and extent of

Residual Oil Zones (ROZ) in the Bighorn Basin. EORI

• Ongoing CO2 EOR project tracking. EORI

• Regional Management Plans. BLM

• Wyoming CO2 Pipeline Initiative. WPA/EORI/Govs Office

Other Activities


Supply • Shute Creek*

• 1981: Exxon drilled exploration wells

• 1984: Shute Creek Construction

• 1986: First Production

Currently, only active supplier of CO2 in Wyoming.

Can supply up to 340 MMcfpd.

Supplies Rangely, Monell, Beaver Creek, Bairoil Complex and Salt

Creek.

• Natural Gas Production • Lost Cabin, Riley Ridge

• In-situ and Surface Coal Gasification • Carbon Energy, Linc Energy, Medicine Bow Fuel and Power et al.,

• Natural Gas Power Systems?

* From Condon and Parker, 2011: Shute Creek Treating Facility Project Updates. 5th Annual Wyoming CO2 Conference, July 13, 2011


Shute Creek

Salt Creek ~115 MMcf/d

Monell ~40 MMcf/d

Rangely ~35 MMcf/d

Beaver Creek ~35 MMcf/d

Bairoil, ~30 MMcf/d

2011 Shute Creek CO2 Sales (MMcf/d) by EOR Project

Data from WOGCC website


Shute Creek

0

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MM

cf/d

Salt Creek

Monell

Beaver Creek

Rangely

Bairoil

Data from WOGCC website


Project Field Reservoir Injection Start

Total CO2 Purchased (MMscf)

Cum. Incr. Oil* (bbls)

RF* (% OOIP)

URNET* (Mscf/bbl)

Bairoil Lost Soldier/Wertz

Tensleep, Darwin/ Madison, Flathead

1986 331,328,494

65,828,061 ~8%

~5

Beaver Creek

Beaver Creek

Madison 2009 38,283,234

2,459,387

~2%

~15

Salt Creek

Salt Creek

Wall Creek 2 2004 269,784,126

10,699,231 ~1%

~25

Monell Patrick Draw (Monell Unit)

Mesaverde Almond

2004 65,917,029

7,481,084

~7%

~9

* Incremental recovery, utilization ratio and recovery factors are highly sensitive to analytical assumptions. We have been as conservative as possible and our assumptions

may not match those used internally by operators.

CO2 EOR Project Summary (@ Dec, 2011)


Utilization Ratio*

𝑈𝑅𝑛𝑒𝑡 = 𝐶𝑂2 𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑑

𝐼𝑛𝑐𝑟𝑒𝑚𝑒𝑛𝑡𝑎𝑙 𝑜𝑖𝑙 𝑈𝑅𝑔𝑟𝑜𝑠𝑠 =

𝐶𝑂2 𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑑 + 𝐶𝑂2 𝑟𝑒𝑐𝑦𝑐𝑙𝑒𝑑

𝐼𝑛𝑐𝑟𝑒𝑚𝑒𝑛𝑡𝑎𝑙 𝑜𝑖𝑙

* Incremental recovery, utilization ratio and recovery factors are highly sensitive to analytical assumptions. We have been as conservative as possible and our assumptions

may not match those used internally by operators.

• A measure of economic efficiency. • Dependent on flood design and maturity.

• WAG vs GS, number of HCPVs injected • Compare Salt Creek with Beaver Creek

• SC: phased, WAG, pattern flood, 1099 MMBO OOIP.

• BC: WAG-GS hybrid, Single development phase, 109 MMBO OOIP

• A measure of technical efficiency. • Dependent on flood design and

sweep efficiency.


Wyoming CO2 EOR (@ Dec, 2011)

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CO2 Oil by Project

Bairoil

Salt Creek

Monell

Beaver Creek


Wyoming CO2 EOR (@Dec, 2011)

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CO2 Oil by Field

Beaver Creek

Monell

Salt Creek

Bairoil

Since 1986 CO2 EOR has produced 86.5 million barrels of Oil



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CO2 Oil 81' to present

CO2 Oil as % of Total

Incremental CO2 Oil



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Wyoming CO2 Oil and State Tax Revenue per year

Tax Revenue

CO2 Oil


Wyoming CO2 EOR

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Incremental CO2 Oil

Pindeale/Jonah Condensate

"Conventional" Oil


Wyoming CO2 EOR

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Oil

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bb

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Stimulated Horizontal Play Production

MOWRY

NIOBRARA

PARKMAN

SUSSEX

TURNER

Grand Total


If we are capturing and injecting CO2 that would have

otherwise been emitted to the atmosphere……

but producing fossil fuels that produce CO2 when

burned…

What exactly is our contribution to atmospheric CO2

concentration?

CO2 Balance

The following 3 slides are entirely tongue-in-cheek


What we think we do…

• CO2 injected >> CO2 produced

CO2 Balance


What the public thinks we do…

• Who cares so long as we’re making money

CO2 Balance


What some environmentalists think we do…

• Its all a conspiracy by Big-Oil

CO2 Balance


But what do we actually do? • Requires Life Cycle Assessment

• Analysis of CO2 Avoidance

• Compare: Total system CO2 emissions under current scenario

(with CO2 EOR) against Total system CO2 emissions under

alternate scenario (no CO2 EOR)

• This can be highly complicated but with a few simple assumptions it

becomes a lot easier.

Assumptions: • All CO2 purchased for CO2 EOR in Wyoming is injected.

• All CO2 injected is stored.

• Other CO2 sources in the lifecycle (e.g. due to transportation, electrical

power) are insignificant compared to CO2inj and CO2prod and are ignored.

• 1 bbl of oil is equivalent to ~8.3 Mcf of CO2* • CO2 Emissions to date (X)

• CO2 injected (CO2inj) = CO2 purchased for CO2 EOR purposes.

• CO2 produced (CO2prod) = CO2 emitted by processing the incremental oil

produced by CO2 EOR.

CO2 Balance

* http://www.epa.gov/cleanenergy/energy-resources/refs.html


A) Current Scenario (with CO2 EOR)

= X + CO2prod

B) Alternate Scenario (no CO2 EOR)

= X + CO2inj

Compare A:B

CO2prod:CO2inj

CO2 Balance


CO2prod = 715,736,915 Mcf (40,899,252 tons)

CO2inj = 705,312,883 Mcf (40,303,593 tons)

Total emission contribution ~ 600,000 tons.

Reduction in emissions ~ 98.5% (compared to ‘conventional’

recovery of same volume of oil)

= Green Oil!!

CO2 Balance


Conclusions

• Development of CO2 EOR projects in Wyoming continues. • In 2011, CO2 EOR produced 6.5 million barrels of oil (12% of

total oil production) • CO2 EOR, Condensate production (and the increasing influence

of stimulated horizontal drilling) has halted the decline of oil production in Wyoming and will likely lead to an increase in the short to medium term.

• CO2 EOR has produced 86.5 million barrels of oil from Wyoming reservoirs.

• CO2 EOR drastically reduces the amount of CO2 emitted to the atmosphere from oil produced.


Glen Murrell

[email protected]

307 766 2843

Questions?

Wyoming CO2 Status and Developments

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