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National Subsea Research Initiative

Gas disposal; What are the options for small pools?

Christer Fjellroth

2016

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Overview • Generic Technology Overview

• Benefits

• Potential Technology Suppliers

• Potential Specific Solutions

• Concluding Remarks

• Recommended Further Work

• Appendix

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Generic Technology Overview In exploiting the UK Small Pools, a prevalent problem will be what to do with the produced gas in primarily oil producing wells. Given the size of each individual reservoir, it could be uneconomical to put processing and export infrastructure in place that will only be in use for a relatively short period of time.

As it stands the main solutions to this problem are flaring and re-injecting the gas. There are a number of technologies for capturing low pressure gas at source or in an offshore processing plant. These include:

• Flare Gas Recovery Systems

• Water Alternating Gas (WAG)

• Offshore Methanol Production

• Offshore Power Generation

• Methane to Plastic

• Gas to Liquid (GTL)

• Micro Liquid Natural Gas (LNG)

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With all the options listed, there is potential to monetise a waste product while reducing environmental discharge of CO2 and methane at the same time. The benefit of using these solutions in small pools is that it will eliminate the need for a gas export line.

Benefits

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Flare Gas Recovery Systems Wartsila Zeeco John Zink Transvac Water Alternating Gas Shell Eni Statoil Offshore Methanol Production Waller Marine

Power Generation Power Barge Corp. Methane to Plastic University of Munich Gas to Liquid SBM Offshore Compact GTL Velocys Micro LNG LNG BOC

Potential Technology Suppliers

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According to the Global Gas Flaring Reduction Initiative (GGFR), “more than 140 billion cubic metres (4.9 trillion ft3) is flared annually and the same amount is probably vented.” There is a trend in the oil and gas industry to reduce flaring and utilise Flare Gas Recovery Systems (FGRS). It is possible to retrofit these technologies to existing plants. Statoil have installed FGRSs on Gullfaks A and estimate they have saved 20 million NOK (£1.6M) in Carbon Dioxide tax. Gullfaks A has used the gas as fuel or for gas injection. FGRS are field proven and pressure to reduce flaring could potentially make this technology commonplace. The drawback of this method is that gas still needs to be exported, used for power generation or reinjected.

Flare Gas Recovery Systems

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Transvac have developed ejectors which safely and economically compress waste and surplus gas back into the production process. Ejectors are ideally suited to this application because they employ either the available high-pressure gas or liquid energy to entrain and compress waste and surplus gas to a pressure where the gas can be recovered into production or used as fuel gas. The ejectors have no moving parts and require no maintenance. Other Vendors of FGRSs include: • Wartsila • Zeeco • John Zink

Flare Gas Recovery Systems

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Water alternating gas (WAG) process has been used to improve the mobility of the flooding system resulting in better sweep efficiency and improvement in oil recovery efficiency. WAG injection has been widely applied since the late 1950s and usually uses CO2. The gas represents a large fraction of the total cost where surplus gas is not available. Utilizing this method where gas disposal is an issue could increase rate of recovery and dispose of gas in an environmentally friendly way.

Water Alternating Gas

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This technique has been used by many operators including Statoil and Eni. Statoil have stated that the challenges related to WAG are: • Mechanisms: understanding microscopic effects, particularly in cases

where three-phase flow and hysteresis are important for the improved oil recovery effect. Capillary phenomena and wettability are important properties for low-permeable rock and may be taken advantage of or manipulated for IOR gains.

• Predictions. • Use of foam (foam-assisted WAG or FAWAG). • Gas costs: gas injection is usually seen as supplementary to an on-

going waterflood, and finding technical and commercial ways to reduce gas costs would prove beneficial.

The problem with this solution is that it requires an injection well and topside compressor as well as a flowline/riser etc. For small pools, this might be too expensive.

Water Alternating Gas

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Methanol production has been considered a feasible alternative to flaring associated gas for development of marginal gas fields. The advantage of the methanol process over other possible ways of converting natural gas to a commercial product are the relative simplicity of the process and the ease in handling the methanol. The conversion of natural gas to methanol usually requires a pre-treatment stage to remove any hydrogen sulphide which would poison the catalysts used in the conversion process. The desulphurized gas is then passed with high pressure steam over a nickel catalyst in the reformer to produce a gas consisting of hydrogen, carbon monoxide and dioxide. This gas is then compressed and passed over a catalyst in radial flow converters to produce methanol and water.

Offshore Methanol Production

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Note: Waller Marine was contacted for information concerning volume of gas required for this facility but no response was given. August 2016

Offshore Methanol Production

This method has been discussed since the 1980’s but very little has been done to develop the idea. Waller Marine has a concept for a Methanol Plant that would take the form of a semisub. This area needs more R&D. If a Methanol Plant could be made compact enough to fit on an FPSO, the product could then be transported in the same way as the crude oil. This method is around 5 years from being commercial.

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The concept of offshore power generation is, in its simplest form, a consolidation of existing technologies.

Offshore production facilities currently generate electricity for their own consumption. Commercial floating generation plants have been employed in various locations, typically near shore or dockside. High voltage electrical power is transmitted by subsea cable.

Offshore Power Generation

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Power Barge Corporation already produces these and they are operating in locations in the Gulf of Mexico.

To be cost effective, these barges need to take on 50MMSCF of gas. In Small Pools this may require several developments tied back to a power barge.

With more renewables developments in the UKCS, it may be possible to export excess power to the renewables power grid infrastructure to sell power back to the grid. This could make use of the produced gas profitable.

Offshore Power Generation

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Johanes Lercher and colleagues at the Technical University of Munich have found a means of producing methyl chloride, a key plastics-industry chemical, from gas which is usually flared. This technology is still in the experimental stage. The technique could have one drawback, it uses chlorine, a toxic gas. The researchers' plan includes recycling the hydrogen chloride and repeatedly using it for the reaction. "In the vision we're playing with, the chlorine would not ever get on a boat," says Eric Strangland, a chemistry and catalysis researcher at Dow and a co-author of the 2007 paper on the subject. Transporting plastic could prove difficult and energy companies would need to find new customers for these plastic products. Time to market is likely 10 years.

Methane to Plastic

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SBM Offshore and Compact GTL have developed a concept for an FPSO with an integrated GTL plant for small field developments. The concept is ready for field specific FEED. Velocys have developed a small scale GTL and have estimated that an offshore facility could process 1,000 bpd (assumptions such as GOR for this figure were unavailable) and take up approximately 20% of total deck space on an FPSO. Velocys have so far only manufactured onshore GTL facilities.

Gas to Liquid (GTL)

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Information from Compact GTL suggests for the Small Pools, this could be the most economical method however they had not considered re-injection in their comparison. Cost effective GTL would require 30-50MMSCF/day of gas. This may require several small pools to be tied back to a main facility. Estimated cost for a module is between £35-40 Million, this module could service several developments to spread the cost.

Gas to Liquid (GTL)

(Trillion Cubic Feet)

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LNG – BOC have a Micro LNG plant in a remote location in Tasmania. This plant exports LNG to tanks mounted on trucks and is transported by road to where needed. This plant produces 50 tonnes of LNG per day and runs 24 hours a day. This size of plant could be fitted to an offshore platform, in order to transport the LNG the platform could have removable tanks which are swapped out and transported back to shore. LNG is currently the cheapest way to transport gas, a problem is that the natural gas has to be transported at pressure in the liquid state.

Micro LNG

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Concluding Remarks Flare Gas Recovery Systems are currently in place, the issue with these is what to do with the recovered gas. This is most likely to be used for small pools which are tied back to existing infrastructure with associated export infrastructure.

Water Alternating Gas is an enhanced oil recovery method already well established. The biggest restriction on this method is having a suitable reservoir. Another restriction on this method in small pools is the requirement for an injection well which will drive up costs unless drilling costs can be reduced.

Methanol Production has potential for small pools. Methanol is easy to store and transport, further R&D is required to put this offshore. With R&D this method is likely 5 years from commercialisation.

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Concluding Remarks Offshore Power Generation is being practiced in other parts of the world with Power Barges, these are commercial and could be implemented in the UKCS.

Gas to Liquid plant is cost effective for gas volumes of 30-50 MMSCF. The technology is being developed by Velocys and they have proposed a concept for an offshore small scale GTL plant. This has similar advantages to the Methanol production in that the product can be transported with crude oil in tankers. Several companies are researching GTL, commercialisation will rely on a cost benefit analysis and operators utilizing new technology.

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Concluding Remarks

Gas to plastics is still in very early stages of development. Transporting plastics could prove difficult and energy companies do not have a strategic interest in producing plastics. Gas to plastic is still in very early stages of research, this could be a potential solution in 10+ years time when/if it becomes commercial.

Micro LNG is commercialised onshore, further research would need to be conducted to take this technology offshore, full scale FLNG such as Shell Prelude have been developed, Micro LNG may be a more suitable option to explore small pools

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Recommended Further Work Flare Gas Recovery Systems are already in place, further work is not pertinent to small pools.

Methanol Production, this area could be developed for small pools, required gas volume, cost and size of plant will determine if this technology is appropriate.

Offshore Power Generation, an investigation into why these are not seen in the UKCS.

Micro LNG is in place onshore, research could be conducted to determine what would be required to put these plants offshore. Also how much would need to be processed to make this system cost effective. These could be much more cost effective than the current FLNG systems.

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Appendix • http://www.wartsila.com/products/marine-oil-gas/gas-solutions/gas-recovery/wartsila-flare-gas-recovery

• http://www.zeeco.com/pdfs/Offshore-Brochure-Web.pdf

• http://www.offshore-mag.com/articles/print/volume-58/issue-8/technology/gas-processing/flare-gas-recovery-system-saving-23-mmcm-year-on-gullfaks.html

• Evaluation of Oil Recovery by Water Alternating Gas (WAG) Injection - Oil-Wet & Water-Wet Systems SPE 143438

• http://www.statoil.com/en/technologyinnovation/optimizingreservoirrecovery/recoverymethods/wateralternatinggaswag/pages/water-alternating-gas%20(wag).aspx

• http://www.wallermarine.com/offshore.html

• OTC-14289

• http://www.powerbargecorp.com/market.html

• https://www.newscientist.com/article/mg19325936-500-catalyst-recycles-waste-methane-into-plastics/

• http://library.certh.gr/libfiles/PDF/LEM-PAPYR-5274-MODIFIED-in-TIC-V-52-ISS-9-PP-1220-12310-Y-2009.pdf

• http://pubs.acs.org/doi/abs/10.1021/ja066913w

• http://www.compactgtl.com/wp-content/documents/110119_CompGTL_12p_A4_HR_FINAL.pdf

• http://www.compactgtl.com/wp-content/uploads/2015/04/CompactGTL-presentation-for-IGTC-2015-English-version.pdf

• http://www.glp.com.au/process-plant/micro-lng-plants/

• http://www.igu.org/sites/default/files/node-page-field_file/SmallScaleLNG.pdf

• http://www.shell.com/about-us/major-projects/prelude-flng.html

• http://www.velocys.com/our_business_overview.php

• http://www.plumenergy.com/

• http://www.keppelom.com/en/content.aspx?sid=3618

• https://www.geoilandgas.com/liquefied-natural-gas/gas-liquefaction/small-scale-lng-liquefaction-plant

• Meeting with Girish Kabra

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