Release Date: December 28, 2001

MORGANTOWN, WV - The Department of Energy is adding two new projects to its program to develop new technologies that can increase natural gas production from low-permeability, or "tight," reservoirs.

The new projects - to be carried out by Advanced Resources International, Arlington, VA, and Cementing Solutions, Houston, TX - were selected for federal cost-sharing when Congress increased DOE's budget for natural gas research in fiscal year 2002. They will join two earlier projects selected last August (see August 15, 2001 Techline). All four projects had been proposed in an industry-wide competition run earlier this year by the Energy Department's Strategic Center for Natural Gas, part of the government's National Energy Technology Laboratory.

Developing new technologies that can tap "low permeability" gas-bearing formations is likely to become increasing important as the nation's gas demand expands in coming years. President Bush's National Energy Policy cautions that production from "conventional" gas sources could peak within the next 15 years, and domestic gas producers will likely turn to harder-to-produce "unconventional" reservoirs to meet demand.

If successful, new technologies could add trillions of cubic feet of natural gas to the nation's gas supply. Much of the nation's low-permeability gas formations are found at depths greater than 15,000 feet. Many of these formations lack an extensive, well-connected network of natural fractures through which the gas can flow to producing wells.

Also, gas producers are increasingly encountering surprising levels of water production from formations where water was not expected to be a problem. Many operators are now thinking twice about developing certain areas where excessive water production has been encountered.

The new projects focus specifically on these challenges. Together, the projects are valued at nearly $1.6 million, 64% of which, or about $1 million, will be provided by the Energy Department.

Advanced Resources International, Arlington, VA - This project represents the first in-depth, comprehensive attempt to understand and address water-production dilemmas of gas fields in the Rocky Mountains.

Unwanted water production adds costs for disposal, reduces gas production, and increases the risks of natural gas exploration and development in these promising formations. And little is known about what causes high water production, its sources and flow paths. Consequently, no consistent strategies now address this problem. The presence of mobile water and high water production is becoming more of a problem in major gas producing basins including the Piceance Basin in Western Colorado, the Greater Green River Basin in southwest Wyoming, and the Wind River Basin in Central Wyoming.

Specifically, the proposal sets out to accomplish three goals:

1. To build a regional database on water composition and chemistry for key Rocky Mountain gas basins,

2. To identify sources and waterways in close proximity to natural gas formations, and

3. To verify regional water storage, flow models and field tests to avoid or mitigate high water production. The effort is aimed at the major northern Rocky Mountain gas basins, with emphasis on the Green River and Wind River basins of Wyoming, and the Waltman/Cave Gulch field on the eastern side of the Wind River basin.

Cementing Solutions, Houston, TX - This project will examine several aspects of zone isolation to increase gas production from low-permeability reservoirs. Gas is harvested by drilling a borehole, inserting a steel casing and injecting cement between the casing and reservoir, thereby isolating a "zone." The zone is then perforated - holes are shot through the casing and cement - and water-based fluid and proppant (sand) are pumped through the perforations to create vertical fractures through which gas flows. At times, the rock formation containing natural gas may be damaged, making it more difficult to recover the fuel.

This projects looks at how to achieve good zone isolation. Experimental results and mathematical modeling will be fed into a computer-based, best-practice decision matrix, which will permit gas producers to evaluate the best types of cements, properties and placement methods that maximize gas stimulation and minimizes formation damage.

Focusing primarily on the Ardmore basin in southcentral Oklahoma, the project will identify other basins that may benefit from the findings.

These strategies will be followed throughout the course of the project:

1. Determining the effectiveness of zone isolation for establishing effective pressure isolation (a hydraulic seal),

2. Using post-fracture-treatment data to confirm how well the hydraulic seal prevents near wellbore fracturing out of a zone,

3. Measuring the loss production from low-permeability reservoirs because of the effects of fluid invasion during cementing, and

4. Assessing procedures to seal in vertical wells to determine if these procedures could be successfully applied to horizontal wells.