UAE weighs carbon dioxide gas injection for old oilfields

Agreement reached at the UN's Cancun climate change summit is in tune with the UAE's ambition to initiate a carbon capture programme.

Let the sun shine: the UAE is weighing up the merits of burying the greenhouse gas carbon dioxide underground.

Carbon dioxide now looks set to represent a major opportunity for the UAE after an international climate change conference embraced the region's economic and environmental vision of burying the greenhouse gas underground.
As almost 200 nations gathered for the Mexico conference coincidentally Dubai hosted its own coming together of minds as leaders from the energy industry met to discuss the future for carbon capture and storage.
A diverse group, including oil industry executives, university professors and contractors, flocked to the Carbon Capture and Storage (CCS) World MENA conference in Dubai to discuss the possible source of lucrative projects several years from now - should carbon capture and storage become a major new business for Gulf oil producers.
That now seems an increasingly realistic prospect after the UN summit, which ended yesterday, agreed to make CCS, eligible for funding under a United Nations clean technology scheme - a key issue for success of carbon capture for many at Dubai conference.
The Cancun agreement included the approval of CCS as a way for countries to earn tradable credits for carbon emissions reduction under the UN's Clean Development Mechanism (CDM).
"We need international incentive systems for CCS," Dr Wolf Heidug, who heads the International Energy Agency's carbon capture and storage unit, told the conference in Dubai. Including CCS projects among those eligible for financial incentives under the UN programme will help put a clear price on carbon emissions, making it more financially attractive to capture waste carbon dioxide than to vent it to the atmosphere.
Gulf energy producers, which have some of the world's highest per capita carbon emissions, might be able to establish a regional market for trading emissions permits. Credits earned by CCS developers could then be traded on a local carbon market or the one already established in Europe.
Besides earning UN carbon credits, the UAE and others could use captured carbon dioxide to push oil from their ageing fields. The waste gas would replace less efficient techniques using water or more valuable natural gas - enabling the country to direct more of its limited natural gas supply to power and petrochemicals plants, said Dr Zara Khatib, a local technology manager with Royal Dutch Shell.
Dr Khatib said she believed including the technology for CCS in new oilfield developments would account for just 5 per cent to 10 per cent of the total project costs. Other experts, however, said even with its inclusion in the CDM, the present technology for CCS would not be economically feasible on an industrial scale.
The UN carbon credits might cover only the cost of capturing carbon emissions, not the costs of transporting and storing the carbon dioxide, said Keristofer Seryani, the deputy manager of commercial development at Masdar, the Abu Dhabi Government's clean energy company. Brian Freeman, the business development manager at Integrated Environmental Solutions, a consultancy based in Kuwait, said the role of CCS in staving off climate change was a secondary one.
"The real economic incentive behind CCS is in EOR [enhanced oil recovery]," Mr Freeman said. Some EOR methods, including the cheapest approach involving flushing out oil with water, can permanently damage oilfields if not correctly carried out. Injecting carbon dioxide is more expensive but also more efficient.
Carbon dioxide mixes more easily with reservoir oil than either water or natural gas, thinning it out and making it less viscous. The oil then flows more easily into the production wells that pump it to the surface.
The process could extend the life of a large oilfield by as much as 15 per cent, Mr Freeman estimated. Even without special measures for recovering it at the well-head for re-injection, as much as 70 per cent of the carbon dioxide stays underground.
"You have an economic case for EOR, but you also have an environmental case for EOR," Mr Freeman said. Such projects, however, require a lot of carbon dioxide to be effective. Rather than installing expensive systems to capture emissions from aluminium, steel or power plants, as the UAE intends, most existing EOR projects using carbon dioxide exploit natural underground reservoirs of the gas. Those are common in Texas, where carbon dioxide-based EOR originated. They are not known to exist in the UAE. Moreover, pumping the gas from one underground reservoir just to reinject it into another has little environmental benefit.
Even if governments increase funding for CCS, which would help bring down the costs of carbon dioxide-based EOR projects in the Gulf, many obstacles remain.
First, it is difficult to gauge exactly how much gas a depleted oilfield could hold. Usually engineers base their estimates on the amount of oil previously pumped out of oilfields, but this may be an unreliable guide to ultimate oil recovery - and therefore the eventual space available for gas storage.
"The methodologies used to generate these numbers are not robust," Dr Heidug said. "Virtually all the methodologies out there are resource-based estimates."
Although capturing emissions is the most expensive component of CCS, retrofitting old wells and pumps with corrosion-resistent linings and parts also adds significant costs. Carbon dioxide is acidic when dissolved in water.
Dr Jeff Chapman, the chief executive of the UK's Carbon Capture and Storage Association, the industry group hosting the Dubai gathering, proposed another way to make CCS economically feasible: charge oil consumers for its use.
Fuel extracted using CCS and EOR should be marketed at a premium, he suggested.
 
[e-mail]