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Cost the biggest challenge for coalbed methane in Alaska Consultant says shallow wells won’t be economic until they are done in enough quantity to support local rig, service industry Kristen Nelson PNA News Editor
Robert Downey, consultant for Ocean Energy Resources Inc. on its Matanuska-Susitna Borough coalbed methane work at Unocal’s Pioneer unit, told a coalbed methane conference in Anchorage in early March that the biggest challenge for coalbed methane drilling in Alaska was going to be “getting the cost down.”
“Post holes” don’t fit the model for Alaska contractors, he said.
“It’s a challenge to get people to understand that we aren’t an Exxon.”
They had to bring in a rig from Michigan last summer because there were no appropriate rigs available locally, Downey said, and then it took 25 days to drill the first well. Everything on that rig that could break, did break, he said.
Downey said he couldn’t reveal the cost, but said it’s expensive when you’ve got to bring in equipment to do the work. In addition to bringing in equipment, the first drilling location had been used as a junk yard, and the companies spent a lot of money cleaning up.
Downey said that getting the costs down is also a matter of critical mass — if someone drilled 100 wells, service companies would follow. He noted that Evergreen Resources Inc. of Denver, which drills about 100 coalbed methane wells a year, had brought down its costs by purchasing its own rig and fracturing equipment.
Drilling this summer included re-entry of ARCO’s Big Lake well and a saltwater disposal well and two producers near Vine Road.
They took a lot of core samples in a cooperative program with the U.S. Geological Service. While these first wells were drilled with water because they wanted good samples, other wells may be drilled with air.
Downey said he could not talk about results in any detail, but said numerous thick coals were encountered. They ran out of weather in 1999, he said, and will be back this summer.
The next step could be stratigraphic tests drilled across the unit, he said, and based on results from initial drilling, phase II of the project could be 15-20 development wells.
State work Jim Clough of the Alaska Division of Geological and Geophysical Survey in Fairbanks said that the state is continuing with its goal of testing coalbed methane for rural energy. This past summer, he said, coal was collected at Wainwright to test for ash content and cleat quality. The next goal is funding for a shallow 2-D seismic reflection data, estimated to cost at least $250,000. A request for proposals is expected to be out shortly.
Two wells in each of the proposed test sites — Wainwright, Fort Yukon and Chignik Lagoon — is still the goal, Clough said. The first hole would determine the stratigraphic position of the coal and in the second hole the state would core and log the hole. Phase two would include hydrology testing — pumping one well toe determine hydraulic response. Phase three would be dewatering and phase four would continue the detwatering for two to four years.
The state, he said, is working with the U.S. Department of Energy on funding, estimated to be $4.6 million for work at all three sites.
One of the problems, he noted, echoing Downey’s statement, is that there is no drill rig in the state.
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