Washington and Oregon: Deep Coal Seam CO 2 Sequestration Potential

1. Washington and Oregon:Deep Coal Seam CO2Sequestration Potential Scott H. Stevens, Greg Bank Advanced Resources International, Inc. (ARI) Arlington, Virginia, USA WESTCARB Meeting Portland, Oregon October 28, 2004

2. CO2 – ECBM Study Results • The NW is short on good quality “conventional” (sandstone, carbonate) depleted reservoirs for geologic sequestration. • Fortunately, extensive coal deposits occur in the NW, located close to industry and power generation. • This first CO2-ECBM study synthesized all available data, including confidential CBM pilot results. • CBM testing indicates good reservoir quality: 100 ft coal, 1,000 ft3/ton CO2 sorption, 5 md permeability. • Good potential for CO2 storage using Centralia power plant (1,400 MW) near Seattle-Tacoma.

3. 1.0 CBM Basics

4. 1.1 CBM Basics Coalbed methane (and CO2) storage and production mechanisms differ from those of Conventional reservoirs. CH4 and CO2 gas is “sorbed” under pressure onto the huge surface area of coal. This makes CBM reservoirs more difficult to evaluate.

5. 1.2 CBM Basics Left CBM is produced using: low-damage air or light mud drilling; cased hole; selective gel or water/sand frac. Water is pumped up tubing, gas flows up annulus. Right Coal mine methane (CMM) wells, uncased in-mine horizontal boreholes and surface vertical gob wells, are less productive but used for mining safety.

6. 1.3 CBM BasicsCoalbed Methane Production • Produced using conventional vertical wells • Water is pumped out of coal reservoir, reducing pressure and eliciting CH4 desorption from coal. • Produced at low P (~50 psia), need compression. • Gas is >95% CH4 with minor CO2 (0-5%) • Future coal mining becomes easier and safer. • CBM provides nearly 10% of US natural gas prod.

7. 9 Commercial Basins, >20,000 Wells, 29.1 Tcf Reserve Additions out of 600 Tcf of Gas in Place. Northwest undergoing pilot testing but still pre-commercial. 1.4 USA CBM Basins Powder River 61 Tcf 0.1 Western Washington 24 Tcf 3.0 Illinois 21 Tcf Northern Appalachian 61 Tcf Wind River 2 Tcf Greater Green River 84 Tcf Forest City 0.1 Uinta 10 Tcf 0.3 Central Appalachia 5 Tcf Cherokee 2.0 Piceance 84 Tcf 1.7 San Juan Fruitland Coal = 50 Tcf Menefee Coal = 34 Tcf Warrior 20 Tcf 17.8 Arkoma 4 Tcf Established CBM Basin Emerging CBM Basin Frontier CBM Basin Raton 12 Tcf 1.5 1.6 N2 and CO2 ECBM Pilots 17.8 Reserve Additions

8. 2.0 CO2 - ECBM

9. 2.1 Location of ECBM PilotsSan Juan Basin, USA • ECBM is still “pre-commercial” but has been tested successfully in the San Juan, the world’s premier CBM basin.

10. 2.2 Burlington Resources Allison Unit CO2-ECBM PilotSan Juan Basin, New Mexico

11. 3.0 WA/OR Coal and CBM Reservoir Properties

12. 3.1 Study Area • Oregon-Washington Eocene coal region. • 3 areas assessed: • Bellingham Basin, northern WA: good coal development, some CO2 sources. • Puget, WA: has best ECBM potential and largest CO2 sources. • Coos Bay, OR: poor coal development and few CO2 sources.

13. 3.2 Regional DEM • Data integrated using ArcView GIS. • Digital elevation model (DEM) allows depth calculation from structure. • Evaluate surface topo for access & costs. • Infrastructure routes.

14. 3.3 Evaluation Used Existing Data Coal Industry Data - Coal exploration corehole logs and core - Proximate analyses - Maceral content - Seismic - Mining data Oil & Gas Industry Data - Well logs (poor resolution for coal; coal core rare) - Mud/Gas logs - Vitrinite reflectance - Seismic (more common, better quality than coal industry) - Drilling records

15. 3.4 Central WA : Coal Stratigraphy • Coal mainly occurs in Eocene Skookumchuck, Spiketon, & Carbonado members of Cowlitz Fm.

16. 3.5 Bellingham, WA • Medium-sized coal deposit in extreme NW Wash. • Distant from CO2 sources but on pipeline routes. • Minimal CBM exploration to date. • Geology favorable but poor data control. • Low priority area for ECBM.

17. 3.6 Central WA • Favorable geology and reservoir conditions. • CBM testing has focussed here, thus good data control. • Close to large CO2 sources. • Best area:See Section 5.0 for details. Kanaskat Carbonado Centralia

18. 3.7 Coos Bay, OR • Small and isolated coal deposit on OR coast. • Located far from CO2 sources. • Minimal CBM exploration to date. • Poor data control. • Low priority area for ECBM.

19. 4.0 CO2 Sequestration Potential

20. 4.1 CH4 Sorption Isotherms (WA & CAN) • Sorptive capacity increases directly with coal rank. • Data from El Paso pilot & nearby British Colombia coals.

21. 4.2 CO2 Sorption Isotherms (WA & CAN) • CO2 sorptive capacity nearly 2X that of CH4. • Data mainly from British Colombia coals.

22. 4.3 CO2 & CH4 Isotherm Rank-Adjusted • Linear correlation allows VL & PL adjusted by rank. • Improved estimate of CO2 storage capacity.

23. 5.0 CO2-ECBM Potential Demonstration Site at Centralia

24. 5.1 Centralia PP • TransAlta’s Centralia power plant near Tacoma & Seattle. • Near coal fields with CBM testing data. • 1.3 Bcfd gas pipeline. • 1,404-MW coal-fired (1971-2). New 248-MW gas-fired CCGT (2002). • 10.5 mt CO2 emissions in 2002.

25. 5.2 Central WA • Favorable coal rank: sub-bituminous in the W to anthracite in E. • El Paso Production CBM pilot tested good permeability (5 md) in coals undersaturated with methane. • ARI still computing CO2 sequestration capacity, but likely more than adequate for Centralia plant.

26. 5.3 Central WACoal Thickness • Duncan Oil #3 well, Pierce County (28-18N-6E) completed in 2000. • Multiple coal seams dispersed over 3,000 ft stratigraphic interval. • CBM well can only complete 5-6 seams using 3-4 fracs.

27. 5.4 Central WACoal Thickness • Penetrated 19 individual coal seams, up to 10 ft thick each. • 100 ft thick in total is quite favorable. • But steeply dipping (15-80º).

28. Seattle 5.5 Next Steps • Complete overall NW ECBM evaluation. • Consider more detailed study of Centralia site for deep coal sequestration. • One of the best options for CO2 storage in the Northwest. Tacoma El Paso Petroleum CBM pilots Northwest Pipeline Corp 1.3 Bcfd Centralia Power Plant 9,400,800 MWh 2002 Emissions: 10.5 mt CO2