and a contribution from Offshore Europe The Society is grateful to - PowerPoint PPT Presentation

Primary funding is provided by The SPE Foundation through member donations and a contribution from Offshore Europe The Society is grateful to those companies that allow their professionals to serve as lecturers Additional support provided by AIME Society of Petroleum Engineers Distinguished Lecturer Program www.spe.org/dl 1

A New Energy Future with Traditional Energy C. Michael Ming Oklahoma Secretary of Energy Society of Petroleum Engineers Distinguished Lecturer Program www.spe.org/dl 2

This year marks the 50 th anniversary of the SPE Distinguished Lecturer program. Please visit our site to learn more about this amazing program. www.spe.org/go/DL50

There is Tremendous Potential to Leverage Natural Gas & Oil • Overall system efficiency can be greatly increased – Currently there is more waste than end use • There are ample natural gas & oil resources – Technology, innovation, & improvement are critical • Natural gas is critical to renewable energy • U.S. models can set the example globally • Oil reservoirs are the practical places to store CO 2 4

Look at the System Backwards Hinrichs/Kleinbach , “Energy – Its Use and the Environment” 5

Comparative Efficiency by Fuel 6 American Clean Skies Foundation

Comparative Efficiency by Sector 7

U.S. Gas Resource Estimates Continue to Increase 8 William Fisher, COGA 2006

The U.S. Gas Shale Ramp • The Barnett grew 3000% from 1998 to 2007 • Growth from the Eagle Ford, Fayetteville, Haynesville, Marcellus, and Woodford will dwarf this • Technology improvements in horizontal drilling and fracturing have economically enabled vast new unconventional and conventional resources. Rick Smead , Navigant Consulting June, 2009; MIT “The Future of Natural Gas,” 2011 9

Once Only Geologic Correlation Markers, Gas Shales Have Redefined The Resource Base! EIA, 2011 10

Technology has Driven the Growth Increased Cost & Risk Improved Technology Steve Holditch 11

Environmentally Friendly Drilling Systems Program Over 50 organizations collaborating to identify, develop and demonstrate cost effective, low-impact Human All Living technologies that can Culture Systems be used in environmentally sensitive areas addressing air, land, and water issues. TerraPlatforms L.L.C.

Engineering Designs for Low Impact Drilling and Fracturing • Conceptual Design for Semi-Arid Ecosystem • Low-Impact Logistical Support • Small Footprint Drilling Rig • Disappearing Roads • NOx Air Emissions Studies • Reduced Fracturing Footprints • Measuring the Effectiveness  The Human Dimension: Societal Acceptance  The Environmentally Friendly Drilling Scorecard 13

Scorecard Development Collaboration Environmental Academia Industry State/Federal Agencies Organizations • Texas A&M University • NRDC • API • US Department of Energy College Station • Environmental Defense • Ballard Exploration • Bureau of Land • Texas A&M University Management • The Nature Conservancy • BP Kingsville • US Park Service • Conservation International • Shell • University of New • Texas Railroad Commission • Mercer Arboretum • Chevron Hampshire • Texas General Land Office • Bureau of Applied • StatoilHydro • UT Medical Center Anthropology/Arizona • Texas Dept. of Agriculture • ConocoPhillips • Mississippi State University • Clinton Climate Initiative • Texas Dept. of • Devon • Sam Houston State Transportation • Rocky Mountain Clean Air • King Exploration • University of South Alabama • US Minerals Management • McFaddin Ranch • Halliburton • John Hopkins University Services • Huisman • University of Arizona • Texas Parks & Wildlife • National Oil Well – Varco • University of Texas • Texas Water Board • MI Swaco • University of Houston • Texas Commission on Env. • TerraPlatform Quality • T. Baker Smith • US Environmental • Weatherford Protection Agency • Derrick Equipment • US Fish and Wildlife • Composite Mats • Argonne National • Ecology and Environmental Laboratory Inc. • Big Thicket Preserve • PTTC • Idaho National Laboratory • IADC 14

More subsurface from less surface 15

Comparative Emissions 16

An Optimal Energy System can Drastically Lower Emissions At minimum a 60% reduction in CO 2 intensity 17

The Issue of Scale 18

In Colorado & Elsewhere The Wind Blows Most Intensely At Night Wind Blows Strongest Between 9:00 pm & 5:00 am When Demand Is Weakest 390 6,000 Wind Generation (MWs) 380 Average PSCO Load (MWS) 5,000 370 360 4,000 350 340 3,000 330 2,000 320 310 1,000 300 290 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Bentek Energy; Wind data - NREL WWIS 2006, PSCO load 2008 FERC 714

Absorbing Maximum Wind Gen Often Requires Reducing N. Gas & Coal Gen Wind Is A “Must Take Resource”. Wind Often Displaces Generation From Other Fuels 7,000 Average 08 Summer Generation (MW) Avg Load 6,000 5,000 Gas Ct Generation 4,000 Gas CC Generation 3,000 Load Minus Wind Gen @ 100% Util Rate 2,000 1,000 Coal Generation 0 12:00 AM 4:00 AM 8:00 AM 12:00 PM 4:00 PM 8:00 PM Bentek Energy; EPA-CEMS, FERC 714

When Coal Is Cycled, The Heat Rate Increases Cherokee Unit 4, Denver CO 400 16 Generation Generation (MW) Heat Rate (MMBtu/MW) 14 38% 250 12 30% Heat Rate 10 100 8 Bentek Energy

NPC 2007 Global Gas Resources Will Develop with U.S. Technology Distribution Of Worldwide Unconventional Natural Gas Reserves (Trillion Cubic Feet) Coalbed Tight-Sand Region Shale Gas Total Methane Gas North America 3017 3840 1371 8228 Latin America 39 2116 1293 3448 Western Europe 157 509 353 1019 Central and Eastern Europe 118 39 78 235 Former Soviet Union 3957 627 901 5485 Middle East and North Africa 0 2547 823 3370 Sub-Saharan Africa 39 274 784 1097 Centrally Planned Asia and China 1215 3526 353 5094 Pacific 470 2312 705 3487 Other Asia Pacific 0 313 549 862 South Asia 39 0 196 235 World 9051 16103 7406 32560 Kawata and Fujita, 2001 22

CO 2 EOR is Growing, But is Limited by CO 2 Supplies “Storing CO2 with Enhanced Oil Recovery” - Kuuskraa ARI et al Feb, 2008 23

There’s More Oil Than Just Existing Field EOR Capacity to offset 67 1 GW coal fired power plants in 27 states “Storing CO2 with Enhanced Oil Recovery” - Kuuskraa ARI et al Feb, 2008

“Storing CO2 with Enhanced Oil Recovery” - Kuuskraa ARI et al Feb, 2008

Natural Gas & Oil Will Be The Foundation Of The New Energy Future • There is up to 50:1 leverage working backwards – Natural gas and efficiency together can capture much of the system inefficiency • The U.S. has over 100 years of remaining natural gas resource – Technology, innovation, & improvement are critical • Natural gas is a must for renewable energy • U.S. gas shale development is an example globally • Oil reservoirs hold great potential to store CO 2 – And to produce even more oil! 26

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“Do or do not, there is no try.” Yoda Thank you! 28