Montana Tech Petroleum Engineering Department faculty involved in the Enhanced Oil Recovery pilot project include, from left: Burt Todd, Dr. Leo Heath, John Evans and David Reichhardt.
The value of Montana oil production in 2012 totaled $2.25 billion.
Conventional horizontal drilling and production methods in Montana's Bakken Oil Field extract 9 to 15 percent of available oil. The remainder – which is to say the great majority – is never touched. The Montana DNRC, through the Montana Board of Oil and Gas Conservation (BOGC), is funding research that could alter the recovery equation and take oil production to a new level.
In 2011, three members of the Montana Tech Petroleum Engineering Department approached the Montana Board of Oil and Gas Conservation with a proposal to conduct a feasibility study of "Enhanced Oil Recovery" options for the Elm Coulee oil field in Eastern Montana.
Tom Richmond, Administrator of the BOGC, says board members understood the project could provide valuable data and analysis for private-sector companies, helping them make informed decisions about whether enhanced recovery was a viable option, and how to go about it.
"Enhanced oil recovery is an important step in the ongoing development of Montana's oil and gas resources," Richmond says. "We have several oil fields with good potential for new technologies to extract more oil."
Burt Todd, Assistant Professor of Petroleum Engineering and one of the Tech researchers, says "Even a small increase in recovery would translate into a substantial production increase. If we find there's an economically viable method for adding five percent, that's significant."
The BOGC approved a grant of $863,905 for the five-year project.
Enhanced oil recovery efforts in other areas of the U.S. have been successful. But each oilfield has its own unique geology, and what works in Texas doesn't necessarily work in Montana. "The Bakken is what geologists call a low permeability formation," says Dr. Leo Heath, head of Tech's Petroleum Engineering program. "The challenge – our goal – is getting oil to flow out of its unconventional shale."
After eighteen months of data acquisition, computer modeling and analysis, the researchers have identified a six-square-mile area of the Elm Coulee oil field with the right geology for their pilot project. Elm Coulee in 2012 produced just over ten million barrels of oil, or about 38% of all oil production in Montana.
There they will drill a series of "injection wells" in close proximity to existing oil wells that are no longer producing. In its undisturbed state, oil exists under pressure. The drilling and fracturing of a new well releases that pressure, a bit like unscrewing the cap on a soda bottle. As production continues, the natural pressure dissipates and oil recovery slows, until it reaches a point where it's no longer economically viable to continue. By most estimates, that process takes 20 to 40 years.
The enhanced recovery concept involves restoring underground pressure in and around depleted wells to the level that existed when the wells were first drilled. They will inject gas – either CO-2 or natural gas – into the surrounding shale in hopes of getting the unrecovered oil to move.
So is it going to work? It's already been demonstrated that injection technology can cause oil to migrate and pool; the unknown for Montana is whether it can be done in a way that's economically feasible. This is the cornerstone of the pilot project. Heath says the work they do will culminate in a detailed cost-benefit analysis, which they'll make available to the private sector.
"Enhanced oil recovery is an evolving field, and we're only dealing with the technical side of it," he says. "What happens with the price of oil? What happens with the price of natural gas, which is very low right now? What happens if government decides to give preferential tax treatment to companies doing enhanced recovery? Any of these factors could sway the economics one way or the other."
Todd notes that the jobs and economic impacts of enhanced oil recovery would be significant.
"It would look very different than the boom we're seeing now. Companies would be here for the long term. It would be a slower, more measured output. The workforce and communities would be more stable – long-term blue-collar and engineering jobs with much more emphasis on technical abilities."
With 85 to 90 percent of Bakken oil just sitting there, it makes sense to investigate.
Go to http://www.dnrc.mt.gov for more information on DNRC programs and services.
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