Alberta looking at ways to expand natural gas use, including in vehicles

[Mr.Coffee]

also Id just like to take this opportunity to delineate something that seems to be poorly understood by the public but is a bit of a tangent.

There is a difference between the Northern Gateway oil pipeline that is vehemently being opposed by First Nations groups and environmentalists in BC, and in my opinion will likely never happen because of that fact, and the NG pipelines that have already been green lighted and have a better chance of actually being connected to Kitimat and used.

Sorry, run on sentence.

But point is that oil line, tricky, gas line, potential to actually work. Shell / Apache / Encana / EOG need to get their ducks in a row, and then Canada will be exporting gas to Asia through BC.

[Mr.Coffee]

also finally for those worried about NG prices... all I have to say is not happening.

The second gas starts to go higher there will be every operator filling storage within months with few wells. The scale of Hz NG production is, to say the least, immense.

Horizontal wells produce an insane amount of gas, and the reserves are there to back it up.

NG prices are not moving anywhere significant short term.

[Bring_Back_Shantz]

Originally Posted by Mr.Coffee

Ok I am certain I am not understanding this correctly... can you please be more specific? Because as far as I know gas liquid yields are what's driving today's deep basin economics. If you're talking about something else, I apologize but I am reading "gas hydrates" as all your "anes" (propane / butane / pentane etc etc etc) and not only are they the key to economics today they're in very high demand, only to go higher in demand if oil prices remain strong. Am I totally out to lunch on what you're referring to as gas hydrates??

.

Sorry, but not even close.

Gas hydrates are (in a quick 1 sentence explanation) a mix of ice and gas that you find under certain pressure/temperature regions (cold and high pressure).

There are Immense volumes of gas locked up in hydrates at the bottom of the ocean, and in the arctic, but they are obviously pretty hard to get at right now.

That's the problem, I don't seen them being viable large scale source of gas for quite some time, simply because of the resources that have been unlocked in shales, that are enormously easier to get at.

[bizaro86]

Originally Posted by Bring_Back_Shantz

Sorry, but not even close.

Gas hydrates are (in a quick 1 sentence explanation) a mix of ice and gas that you find under certain pressure/temperature regions (cold and high pressure).

There are Immense volumes of gas locked up in hydrates at the bottom of the ocean, and in the arctic, but they are obviously pretty hard to get at right now.

That's the problem, I don't seen them being viable large scale source of gas for quite some time, simply because of the resources that have been unlocked in shales, that are enormously easier to get at.

Yeah, gas hydrates require prices an order of magnitude higher than what we have now. You'll see the pipelines both to our arctic and Alaska, and maybe even widespread coal gasification before hydrates get used. (Assuming nobody makes a genius technological breakthrough, which is always possible.)

[TheGrimm]

I am all for the move to NGV's in Alberta. People get all caught up in the fact that Alberta is a big oil producer, but Natural Gas is huge and abundant here as well. The issue with prices and abundance that we see today is attributed mainly to the recent ability to "Frack" for natural gas. This has simply made it rediculously easy to access natural gas and over the past several years every company is guilty of using the new "fracking" techniques to gain easy supply. Now we are at a point where we have more gas than ever before and no one to sell it to, prices have dropped and being a "gas" it's very difficult to transport overseas to China and other countries where the prices remain strong.

There are ways to transport it which are all up-and-coming including liquifying it at very cold temps (-162 celsius). It actually becomes a fairly efficient fuel by volume when liquified however there are some caveats as you can well imagine.

There is also another method which I am not too familiar of where you can turn it to a liquid at normal temperatures however I believe this is a fairly costly process, and thus not widely used.

The Kitimat pipeline will be used to move gas to the coast where it will be transported as LNG to Asia, but this won't be happening for another several years (I think 2015 at the earliest).

The other somewhat interesting fact about natural gas (methane) is that it's actually a fairly renewable resource that happens as a byproduct of decomposing organic material. It is something that we can easily find ways of replacing and when compared to "fossil" fuels it seems like a great way to transition from our dependency.

[Bring_Back_Shantz]

Originally Posted by TheGrimm

I am all for the move to NGV's in Alberta. People get all caught up in the fact that Alberta is a big oil producer, but Natural Gas is huge and abundant here as well. The issue with prices and abundance that we see today is attributed mainly to the recent ability to "Frack" for natural gas. This has simply made it rediculously easy to access natural gas and over the past several years every company is guilty of using the new "fracking" techniques to gain easy supply. Now we are at a point where we have more gas than ever before and no one to sell it to, prices have dropped and being a "gas" it's very difficult to transport overseas to China and other countries where the prices remain strong.

There are ways to transport it which are all up-and-coming including liquifying it at very cold temps (-162 celsius). It actually becomes a fairly efficient fuel by volume when liquified however there are some caveats as you can well imagine.

There is also another method which I am not too familiar of where you can turn it to a liquid at normal temperatures however I believe this is a fairly costly process, and thus not widely used.

The Kitimat pipeline will be used to move gas to the coast where it will be transported as LNG to Asia, but this won't be happening for another several years (I think 2015 at the earliest).

The other somewhat interesting fact about natural gas (methane) is that it's actually a fairly renewable resource that happens as a byproduct of decomposing organic material. It is something that we can easily find ways of replacing and when compared to "fossil" fuels it seems like a great way to transition from our dependency.

Stop spelling it with a "k" and stop putting it in quotation marks.

[TheGrimm]

Originally Posted by Bring_Back_Shantz

Stop spelling it with a "k" and stop putting it in quotation marks.

Sorry, is there another way to spell the already butchered term?

[Bring_Back_Shantz]

Originally Posted by TheGrimm

Sorry, is there another way to spell the already butchered term?

Yeah, frac.

It's not spelled "frackturing" afterall.

[TheGrimm]

Originally Posted by Bring_Back_Shantz

Yeah, frac.

It's not spelled "frackturing" afterall.

I've seen a lot of spell trolling in forums, but can't say I've ever had someone rant that someone mis-spelt a slang term.... Incorrectly I might add :P

http://en.wikipedia.org/wiki/Hydraulic_fracturing

[SeeGeeWhy]

Re: Gas Hydrates. Natural gas is the most abundant hydrocarbon on this planet, well over 50% of what is known to exist, and most of this is because of gas hydrates stored in vast tracts of permafrost and on the sea floor. Canada has three major deposits - West Coast, Arctic, and East Coast. BC will never be developed because of hippies. The Arctic may possibly be developed but it is stranded from market. The East Coast has the best chance, but the geology is complex and no one understands how to produce hydrates in a controlled fashion. There have been a number of studies simulated by Japanese researchers that modify the "SAGD" concept by drilling a pair of horizontal wells into a hydrate formation, and then circulate warm water into the lower well, while producing the gas from the upper well (the reverse configuration from SAGD where steam is injected in the top, and emulsion produced from below). This is a promising technology and should be piloted. I have been trying to calculate the breakeven gas price required for this but there are a lot of factors and I simply don't know enough about offshore drilling to estimate this properly. My intuition is that nat gas would need to be very expensive, or the volumes gathered very large for this to fly. At any rate, I would like to see it piloted off the south shore of Nova Scotia where the hydrate shelf is.

Re: Coal vs Natural gas. The world energy outlook for the next 30 years published by the international energy agency predicts that the world is entering into "The golden age" of natural gas.

http://www.iea.org/weo/docs/weo2011/...fGasReport.pdf

Essentially electricity demand is going to be growing at an insane rate. Most of this is predicted to be fuelled by burning natural gas, and old coal generation plants will be replaced with gas fired generation. Demand will drive significant investment into the development, production, compression and transportation of natural gas.

This paper on LNG markets globally is fascinating, and although it puts a spin on the Australian perspective, it is still relevant to our discussion as the Alberta natural gas market has FOREVER been one based domestically in North America. Opening it up to international markets will indeed be a game changer for our supply and costs locally. This will be a 5 - 8 year change, and when it hits, it will be forever different for the reasons stated above. Our resource has finally been converted to reserves, and the rates large enough for us to play on the global market. We're growing up.

http://queensland.spe.org/images/Que...%20Mode%5d.pdf

This will have a severe impact on the profitability of SAGD in our province unless oil prices rise to cover the pain (which is possible).

Lastly, there are many novel ways to convert natural gas into liquids. Facilities with large enough volumes may be able to produce diesels and other fuels profitably (see, Sasol's diesel project referenced earlier in this thread).

Personally, I am working on a process that uses liquid catalysts to convert methane into cyclohexane (jet fuel component) and other derivatives along with hydrogen gas as a means to feed bitumen upgrading. This would be a replacement to the traditional steam reformation of methane to produce hydrogen gas for hydrotreating.

At any rate, its all good because it needs investment in research and technology and major capital projects to do any of this, and its good for both the environment and the economy.

[Reaper]

Originally Posted by Mr.Coffee

Nobody in AB drills for gas, they drill for oil or for liquid yields.

Southeast Alberta says hi.

[Bring_Back_Shantz]

Originally Posted by TheGrimm

I've seen a lot of spell trolling in forums, but can't say I've ever had someone rant that someone mis-spelt a slang term.... Incorrectly I might add :P

http://en.wikipedia.org/wiki/Hydraulic_fracturing

It's a pet peeve, and trust me I'm not ranting incorrectly.
Talk to 99.9% of people in the industry and they'll tell you there is no "k".

Look at the websites for any of the big companies, Halliburton, Schlumberger, Trican, Calfrac, and the only places you'll see a "k" is as a minor mention (usually to say "yeah, it's the same thing as fracing), or as a brand name for a proprietary product. When actually talking about the process in a technical document the "k" isn't used.

I suppose this should go in the "Grinds my gears" thread, but it came up here, so I shall rant here.

[TheGrimm]

Originally Posted by Bring_Back_Shantz

I suppose this should go in the "Grinds my gears" thread, but it came up here, so I shall rant here.

Indeed. Go add this to the list, I am sure there are a great number of others out there who will join you in a crusade against the misuse of the word!

[Bill Bumface]

Originally Posted by zamler

You know very well I am talking about automotive applications.

So am I. Electric cars are powered by power plants, which are much more efficient. Yes there are transmission losses etc, but still less fossil fuel burned per kilometer.

[Kybosh]

Originally Posted by Bring_Back_Shantz

It's a pet peeve, and trust me I'm not ranting incorrectly.
Talk to 99.9% of people in the industry and they'll tell you there is no "k".

Look at the websites for any of the big companies, Halliburton, Schlumberger, Trican, Calfrac, and the only places you'll see a "k" is as a minor mention (usually to say "yeah, it's the same thing as fracing), or as a brand name for a proprietary product. When actually talking about the process in a technical document the "k" isn't used.

I suppose this should go in the "Grinds my gears" thread, but it came up here, so I shall rant here.

Using the word fracking is way more common in America as well, while fracing rules in Canada.

[SeeGeeWhy]

Originally Posted by Mr.Coffee

Ok I am certain I am not understanding this correctly... can you please be more specific? Because as far as I know gas liquid yields are what's driving today's deep basin economics. If you're talking about something else, I apologize but I am reading "gas hydrates" as all your "anes" (propane / butane / pentane etc etc etc) and not only are they the key to economics today they're in very high demand, only to go higher in demand if oil prices remain strong. Am I totally out to lunch on what you're referring to as gas hydrates??

Gas hydrates are a type of gas "ice". Solid methane usually in the pores of soil, entraned by ice crystals that are at very low temperatures or high pressures (i.e. permafrost or deep sea).

http://woodshole.er.usgs.gov/project...ates/what.html

What you're referring to are the natural gas liquids, or NGLs, when you talk about the C5+ fractions of gas. These are also commonly referred to as "condensates" as they are the liquid fraction that will drop out of gas streams at standard conditions (i.e. they have higher boiling points at lower pressures).

Originally Posted by Mr.Coffee

Here's what's happening in oil and gas, shale gas unlocked enough gas for the rest of our lives plus our kids and their kids. Nobody in AB drills for gas, they drill for oil or for liquid yields. Liquids are then sold as a diluent to oilsands oil (mixed with crappy bitumen oil to create a higher quality synthetic oil and then subsequently marked up and sold). There isn't enough infrastructure right now for NG liquids, this is a huge problem. Depending on oil prices holding, (although I suspect it's going to continue to fall in the next couple months), NGL prices will remain strong.

I think you would enjoy reading about the history of the oil & gas industry in Alberta. It was built on the backbone of nautral gas development, and our economy has really been suffering in the last 7 years because of depressed gas prices. The truth is that LOTS of companies depend on gas - drilling, production, services, storage, marketing, pipelining, petrochemicals, distribution and sale, etc... is HUGE in Alberta.

The condensate diluents you're referring to do not create a higher quality synthetic crude oil. They simply reduce the viscosity and density of the overall product so that it can be pumped in the sales line easier. The diluted bitumen (Dilbit) has the condensates seperated out, and then the heavy bitumen is subjected to the normal upgrading process. The producer receives a gate price for Dilbit at the market and it is based on a combination of a discounted price for the condensate (i.e. the producer loses some $ on each bbl of diluent it uses), and the value of the bitumen, which is usually based on the heavy oil differential being applied to the WTI benchmark - this is to protect the profit margin of the upgraders who sell their synthetic crude to refineries in the US. It's not as simple as selling a "marked up" barrel of bitumen. The same kind of process applies to producers who blend their bitumen with synthetic crude oil. Nexen long lake upgrades their own product on site, so I guess they step around this.

I agree with you on a lack of NGL infrastructure. There are major lines being contemplated out of Edmonton to the Athabasca development area. The supply/demand gap for NGLs is also growing, so I agree the NGL price demand should stay very strong.

Originally Posted by Mr.Coffee

Quite frankly, the conversion to NG is a very good idea for AB. Not only will it keep people employed, but it will be cleaner and AB needs the leverage as environmentalists the world around continue to piss on our province because of the oilsands and it's ridiculous terrible image.

If AB refuses to properly market the oilsands environmentally (because it can't), then you might as well offset your emissions with NG alternatives and use this insanely abundant, extremely cheap energy source.

AB has a really amazing opportunity, it should move to NG.

PS- AB also has a crap ton of gas.

Totally agree. And there are other interesting options to provide process heat without burning natural gas at all, so there is another positive environmental step change possible. PM me if you are interested in more, I don't want to derail the discussion on NG.

[zamler]

Originally Posted by hulkrogan

So am I. Electric cars are powered by power plants, which are much more efficient. Yes there are transmission losses etc, but still less fossil fuel burned per kilometer.

I totally agree. And let's not forget that the electric car gives you energy source options, a petrol powered car gives you only one.

[Bill Bumface]

Exactly, as energy sources shift, car technology and distribution technology doesn't need to follow. Plus the inherently low maintenance cost of electric vehicles. Very few moving parts. Basically brake jobs are your only routine maintenance, so you can save all your oil change money for new batteries in 10 years

[You Need a Thneed]

Originally Posted by hulkrogan

Exactly, as energy sources shift, car technology and distribution technology doesn't need to follow. Plus the inherently low maintenance cost of electric vehicles. Very few moving parts. Basically brake jobs are your only routine maintenance, so you can save all your oil change money for new batteries in 10 years

And even those you'll need less often, as you use brakes less in electric cars.

[TheGrimm]

Battery performance in cold weather is bad, Alberta has a lot of cold weather, therefore Batteries in Alberta = Bad.

I am all for electric vehicles, but I really don't see widespread adoption until we can get rapid charging (5-15 min) and 500k per charge.