Antoine Rostand - Schlumberger - IEA
Antoine Rostand - Schlumberger - IEA
Antoine Rostand - Schlumberger - IEA
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Golden Rules of Gas<br />
<strong>Antoine</strong> <strong>Rostand</strong><br />
<strong>Schlumberger</strong><br />
<strong>IEA</strong>, Paris<br />
12 June, 2012<br />
This document contains “forward-looking statements”- that is, statements related to future, not past, events. In this context, forward-looking statements often<br />
address our expectation of future conditions including, without limitation, economic conditions, energy demand, energy supply and capability requirements.<br />
Forward-looking statements by their nature address matters that are, to different degrees, uncertain. These uncertainties may cause our actual future results to<br />
be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
0<br />
Public
Natural gas and CCS are a key part of decarbonization<br />
GLOBAL EMISSIONS REDUCTIONS BY ABATEMENT METHOD<br />
Billion tons of CO2 emissions<br />
53<br />
Base Case<br />
16<br />
Reducing<br />
Demand<br />
Source: International Gas Union<br />
6<br />
Coal to Gas<br />
substitution<br />
1<br />
Oil to Gas<br />
Substitution<br />
3<br />
Transport<br />
Oil<br />
Substitution<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
9<br />
Renewables<br />
and Nuclear<br />
Greater Gas Use<br />
Carbon Capture<br />
Reductions from other technologies<br />
1<br />
4<br />
Biogas Carbon<br />
Capture<br />
13<br />
Pathway<br />
1<br />
Public
Technology advancement in LNG and UG has made gas abundant<br />
NATURAL GAS RECOVERABLE RESOURCES<br />
VS DEMAND<br />
TCM<br />
Historic Production<br />
Proven Reserves<br />
Conventional Potential<br />
Unconventional Potential<br />
Global Potential<br />
Source: IGU, EIA,<br />
93<br />
187<br />
217<br />
789<br />
385<br />
Cumulative Demand 2011-2050<br />
Annual demand growth at 3.5%<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
GLOBAL SHALE DEVELOPMENTS<br />
Legend: maturity of<br />
shale gas activities<br />
+ -<br />
2<br />
Public
There are public misconceptions about shale gas development<br />
ISSUES CONCERNING THE PUBLIC<br />
Ground water contamination<br />
(fracturing)<br />
Ground water contamination<br />
(wellbore integrity)<br />
Excessive use of drinkable<br />
water<br />
Earthquakes<br />
Surface and truck traffic<br />
Source: SBC Analysis<br />
Public<br />
perception<br />
Industry<br />
Practice<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
No known incidents<br />
Shale gas reservoirs are often much below<br />
ground water aquifers<br />
Risk for all wells in the industry<br />
Fully disclosed, environmentally compliant<br />
fluids & equipment<br />
Less water required than for coal, crop based<br />
ethanol or algae<br />
Insufficient energy to create earthquake<br />
Major fault lines should not be fractured<br />
Seismic sensors can be used as a precaution<br />
Shale gas has a large footprint from legacy<br />
projects<br />
Technology advancements are helping to<br />
address this<br />
3<br />
Public
Technology is moving fast to reduce the footprint<br />
MORE PLANNING LESS FOOTPRINT<br />
Source: SBC Analysis<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
MORE TECHNOLOGY, LESS FOOTPRINT<br />
Reservoir Quality<br />
‘sweet spots’ Culture data<br />
Surface restrictions<br />
Pad Placement<br />
Favorable reservoir<br />
and pad location<br />
Pad Well Design<br />
Pad drilling: well locations intensity reduced by<br />
90% and truck traffic by 15%<br />
“Sweet spot” drilling: reduce well intensity by 40%<br />
“HiWAY Fracturing” : reduce truck traffic by 30-40%<br />
Reusing water: reduce truck traffic by 20-30%<br />
4<br />
Public
Natural gas and CCS are a key part of decarbonization<br />
GLOBAL EMISSIONS REDUCTIONS BY ABATEMENT METHOD<br />
Billion tons of CO2 emissions<br />
53<br />
Base Case<br />
16<br />
Reducing<br />
Demand<br />
Source: International Gas Union<br />
6<br />
Coal to Gas<br />
substitution<br />
1<br />
Oil to Gas<br />
Substitution<br />
3<br />
Transport<br />
Oil<br />
Substitution<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
9<br />
Renewables<br />
and Nuclear<br />
Greater Gas Use<br />
Carbon Capture<br />
Reductions from other technologies<br />
1<br />
4<br />
Biogas Carbon<br />
Capture<br />
13<br />
Pathway<br />
5<br />
Public
CCS-EOR is now strongly developed in the US<br />
US CO2-EOR<br />
k bbl/d, 1986-2010<br />
300<br />
250<br />
200<br />
150<br />
100<br />
50<br />
0<br />
US CO2-EOR VS. OTHER EOR<br />
%, 1986-2010<br />
61%<br />
57%<br />
64%<br />
72% 70%<br />
77% 77% 76% 75%<br />
81%<br />
90%<br />
85%<br />
95%<br />
1986 1990<br />
1998 2002 2006 2010 1986 1990 1994 1998 2002 2006 2010<br />
Source: Oil & Gas Journal 2010, Bloomberg New Energy Finance Note other states includes Oklahoma, Utah, Pennsylvania, Michigan, California, Montana,<br />
Alabama and Louisiana; Oil & Gas Journal 2010, Bloomberg New Energy Finance.<br />
Note: CO2-EOR includes oil production from both miscible and immiscible CO2-EOR projects, though most are miscible (Appendix B:). Other EOR<br />
includes TEOR, chemical EOR, and gas EOR, but consists mostly of TEOR. Production refers to incremental recovery from EOR, or enhanced<br />
production, as reported by project operators.<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
US EOR without CO2<br />
US EOR with CO2<br />
39%<br />
43%<br />
36%<br />
28% 30%<br />
23% 23% 24% 25%<br />
19%<br />
10%<br />
15%<br />
6<br />
Public
All CCS technologies are now proven<br />
INDIVIDUAL CCS TECHNOLOGIES: INVESTMENT-RISK CURVE FOR<br />
Capital requirement * Technology risk<br />
Enhanced coal bed methane<br />
Atmospheric capture<br />
Lab work<br />
Research Development Demonstration Deployment Mature Technology<br />
Source: SBC Energy Institute<br />
CO 2 Shipping<br />
Oxycombustion boiler<br />
Technological<br />
‘Valley of Death’<br />
CO 2 geological sequestration and monitoring<br />
in aquifer<br />
2 nd Generation separation technologies<br />
(solvents, sorbents, membranes)<br />
Mineralization<br />
Algae biosequestration<br />
Oxygen chemical looping<br />
Bench scale Pilot Scale<br />
Maturity<br />
CO 2 geological sequestration and<br />
monitoring in oil and gas fields<br />
CO 2 injection for EOR<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
1 st generation membranes (for CO 2/CH 4 separation at<br />
wellheads)<br />
1 st generation sorbents (for coal-to-liquid plants)<br />
CO 2 pipelines for EOR<br />
Technologies required for first<br />
demonstration projects<br />
Technologies in the making<br />
1 st generation solvents (for gas processing<br />
plants)<br />
Air separation unit<br />
Large/Commercial-scale projects<br />
with ongoing optimization Widely-deployed commercial scale projects<br />
7<br />
Public
The oil and gas industry is leading the way<br />
DISTRIBUTION OF THE 15 LARGE PROJECTS IN OPERATION OR PASSED FINAL<br />
INVESTMENT DECISION (FID)<br />
Lower costs<br />
Decrease of Capture costs<br />
NATURAL GAS<br />
PROCESSING<br />
INDUSTRIAL<br />
HYDROGEN<br />
POWER OR HEAVY<br />
INDUSTRY<br />
Note: As of March 2012<br />
FID: Final Investment Decision<br />
Source: SBC Energy Institute<br />
PASSIVE STORAGE EOR<br />
4 Large Projects<br />
1 passed FID<br />
3 operating<br />
1 Large Project<br />
passed FID<br />
0 Large Project<br />
No storage revenues<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
4 Large Projects<br />
2 passed FID<br />
2 operating<br />
3 Large Projects<br />
1 passed FID<br />
2 operating<br />
3 Large Projects<br />
passed FID<br />
High costs _<br />
+<br />
Storage revenues<br />
Oil & Gas related projects<br />
8<br />
Public
EOR is an important component for achieving the <strong>IEA</strong> roadmap for CCS<br />
GLOBAL POTENTIAL FOR CO2-EOR<br />
MEXICO CO2 SUPPLY CURVE<br />
GtCO2 USD/bbl, MMcf/d<br />
Cumulated CO2 storage required by 2050<br />
(<strong>IEA</strong>'s Roadmap)<br />
145<br />
Global technical*<br />
potential<br />
(within 800km of<br />
existing CO 2<br />
sources)<br />
US economical**<br />
potential at<br />
$85/bbl<br />
20<br />
65<br />
318<br />
(1072 Bn bbls of oil)<br />
(66Bbbls of oil)<br />
Unit cost<br />
Notes: * With next-generation CO 2-EOR technologies<br />
** At an oil price of $85/bbl, a CO 2 market price of $40/Mt, and a 20% ROR before tax<br />
Source: Advanced Resources International, 2011; SBC analysis<br />
40<br />
30<br />
20<br />
10<br />
© 2012 <strong>Schlumberger</strong> Business Consulting. All Rights Reserved.<br />
0<br />
Minimum requirement for 1 field<br />
Maximum requirement for 1 field<br />
Capacity<br />
1,000 2,000 3,000 4,000 5,000 6,000<br />
Reservoirs<br />
Basic<br />
Petrochem.<br />
Steel<br />
Pemex, Cement CO2 Others Industry production<br />
Electric<br />
Industry<br />
9<br />
Public
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