Test taps frozen gas in Mackenzie Delta - Find estimated at 55,000 times proven reserves

Gordon Jaremko
CanWest News Service
Edmonton Journal / Calgary Herald

Thursday, December 11, 2003

A colossal new energy source -- frozen natural gas reserves exceeding all other fossil fuel deposits combined -- has emerged as a development prospect, thanks to an Arctic experiment that included three Alberta oil companies.

Results from three wells on the Mackenzie Delta has transformed gas hydrates from a science project into an industrial target akin to the Alberta oilsands 30 years ago, the leader of the Canadian contingent on the international exploration effort said Wednesday.

"We're in a similar situation," said Jean-Serge Vincent, a scientist emeritus at Natural Resources Canada who was co-chairman of the Mallik gas hydrate research project.

Just as oilsands pioneers showed extraction was possible long before it was profitable, the gas-hydrates team proved its objective is practical, he said.

"The program demonstrated there is certainly technical feasibility of recovering gas hydrates," Vincent said.

The results were unveiled to 260 representatives of scientific and industrial agencies from 15 countries at a symposium this week in Japan.

The data described a $27-million trial named after its site, Imperial Oil Ltd.'s Mallik gas lease on the Beaufort Sea coast, 120 kilometres north of Inuvik.

Participants included three Alberta natural gas producers -- BP Canada Energy, Chevron Canada Resources and Burlington Resources Canada -- as well as the global Schlumberger oilfield services organization and agencies from Japan, Germany, the United States and India.

Initial industry response to the Mallik results is guarded acknowledgement that a new field is opening up.

"This is still probably a couple of decades away before it becomes economic," said BP communications officer Alexandra Wright.

Chevron spokesman Dave Pommer said, "the size of the resource is definitely interesting, but we don't even see it on a pilot scale within the next decade. It's definitely a concept that's in its infancy."

By industry standards, the three experimental wells operated during the 2002-03 winter drilling season were shallow. But at a target depth of 1,150 metres, geologists on the 100-member technical team estimated the program tapped a deposit larger than all the natural gas discovered by conventional exploration since the 1960s on the Mackenzie Delta and in the Beaufort Sea.

Scientific estimates rate the global endowment of the new resource at an astronomical 279,000,000 trillion cubic feet -- more than 55,000 times larger than the world's 5,000 Tcf of proven conventional gas reserves and 4,650,000 times greater than the Canadian inventory of 59 Tcf.

Gas hydrates form beneath northern lands and in ocean depths under high pressure and cold temperatures.

As ice forms, its crystals trap methane created by the natural decay of plants and animals. The gas is virtually pure methane, without contaminants such as sulphur that often make conventional supplies hazardous and costly to develop.

Vincent said the Mallik experiments generated gas flows with three methods of in situ, or underground, separation: by heating the hydrates, lowering pressures in the deposits and by injecting other substances such as methanol.

"The next step is a major, larger production test lasting for months."



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