7/25/2008
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GCGE Gives Testimony to Texas Legislature
Gulf Coast Green Energy test project seeking to generate electricity from inactive gas well
Premium content from Houston Business Journal by Ford Gunter
Date: Sunday, May 31, 2009
A Bay City company is receiving a federal research grant for a project designed to generate electricity from abandoned natural gas wells.
Gulf Coast Green Energy will extract geo-fluid — essentially hot saltwater — from a nonproducing natural gas well and run it through a heat exchanger before dumping it back into a disposal well, creating electricity in the process.
The project is part of a series of federal contracts awarded through the Research Partnership to Secure Energy for America, a Sugar Land nonprofit dedicated in part to advancing technology in maturing oil and gas fields.
RPSEA will chip in about $150,000 to match a similar amount put up by the company for a three-year test on a nonproducing well.
Loy Sneary, president and CEO of Gulf Coast Green, says bringing a dead well back to life serves a dual purpose by providing electric power and sparking a new revenue stream.
“It’s very attractive for owners of wells that are nonproducing,” Sneary says. “If a well produces electricity for 15 to 20 years that just reduces your risk. If you hit a dry well, it reduces your risk.”
Mike Ming, president of RPSEA, says the system could help offset operating costs.
“Wells that are somewhat marginal are very susceptible to operating costs,” says Ming. “If you want to increase recovery from wells and increase well life you can do that by lowering your baseline operating cost. This offsets purchases of electricity from external sources, so it effectively lowers your operating costs.”
Excess electricity from a well close enough to transmission infrastructure could be sold back to the grid.
“If you generate electricity on-site you’re negating the need to buy electricity from elsewhere,” says Ming.
He says the contract, which would mark the first commercial application of exotherm technology, is expected to be finalized within a month or so.
“It’s a high-potential area,” he says. “It’s one of the more applied areas of geothermal energy capture.”
He notes the project was one of the few that met almost all of RPSEA’s criteria.
Says Ming: “Our selection committee was really enthusiastic about this particular project.”
Fluid operation
Sneary says the test project will likely take place in Mississippi. The Gulf Coast region has a lot of wells that match the water temperature and flow-rate qualifications — between 180 and 200 gallons per minute — to run the generator.
Inside the heat exchanger, the saltwater, which must be a minimum of 180 degrees, is run through a tube that abuts another tube containing the “working fluid,” a refrigerant that boils off at a low temperature.
“The high-pressure vapor turns a twin screw expander,” says Sneary. “It’s very similar to a steam turbine, but it operates at about one-tenth the speed, and we use working fluid instead of steam.”
The test project, a 50-kilowatt-per-hour unit will be run with assistance from Denbury Resources Inc.in Plano, the geothermal lab at Southern Methodist Universityin Dallas and the U.S. Army Corps of Engineers in Mississippi.
The manufacturer, ElectraTherm Inc.of Carson City, Nev., has a 500 kilowatt-per-hour unit as well. Gulf Coast Green is the exclusive regional distributor for the units.
The average home operates on 42 to 45 kilowatts per hour. Sneary says the cost of electricity needs to stay above about 8 cents per kilowatt for the system to make financial sense and pay for itself in, at most, three years. But that scenario doesn’t include any carbon credits or green tax breaks that might be coming out of Washington to further benefit the business model.
Depending on the application, Sneary says, the project will qualify immediately for a 10 percent to 30 percent investment tax credit payout.
The system is built to last for 30 years, but Sneary admits that there is a gray area around just how long a well can generate electricity. It’s something that his seven-person, two-year-old company intends to address with part of the RPSEA money.
Gulf Coast Green is also involved in another RPSEA project to develop an environmentally friendly drilling platform. The Houston Area Research Council is taking the lead on that project and participants include Houston-area companies BP America Inc.and Newpark Mats & Integrated Services LLC, as well as Devon Energy Corp., Texas A&M University and SMU’s geothermal lab.
The two projects are part of 43 ongoing RPSEA projects worth almost $60 million dealing with small producers such as the geothermal project, unconventional natural gas projects or ultra-deepwater projects.
RPSEA is currently accepting proposals for a second round of projects, and Gulf Coast Green is interested.
Says Sneary: “We have not submitted for next round, but we are looking.”
Original article by Houston Business Journal at http://www.bizjournals.com/houston/stories/2009/06/01/story10.html
Green Machine cuts operating costs, reduces environmental impact
Electrical power generation technology that has been in use in other industries is now making its debut in the oil and gas arena.
Judy Murray, Editor
May 26, 2009
The Green Machine will show that it is possible to generate emission-free electricity from the hot water produced by gas wells that is typically a waste byproduct of natural gas production. Technology newly introduced to the oil and gas industry has the potential to not only reduce emissions, but to generate electricity.
Gulf Coast Green Energy (GCGE), which offers what it calls “earth-friendly solutions for affordable clean energy” uses ElectraTherm waste heat generators to capture engine emissions and convert them to electricity.
The technology GCGE is applying to the oil and gas industry was developed by ElectraTherm, which manufactures the equipment and holds the development rights for the equipment. “ElectraTherm purchased the development rights from City University in London,” explained Loy Sneary, GCGE president and CEO.
Loy’s company was the first to sign up with ElectraTherm and has been actively working to get the technology into the mainstream. “We are far beyond the R&D phase,” Loy said. “Our equipment has been vetted by TCEQ (Texas Commission on Environmental Quality). We’re out of the proof-of-concept stage and are into the commercialization stage.”
One of GCGE’s most recent steps along the road to commercialization has been to secure funding from the Research Partnership to Secure Energy for America (RPSEA) on two projects that aim to help reduce the environmental impact of oil and gas drilling.
According to Loy, the equipment GCGE distributes, installs, and services, works in many arenas of industrial waste heat, which he refers to as “recoverable heat” because, he explained, “Once we recover it, we are generating valuable emission-free electricity with it.”
GCGE has been working with several natural gas pipeline compressor companies that are attracted to being able to add to their bottom line by generating electricity with the added advantage of cooling the engine thus reducing the need for engine cooling equipment. Loy said.
Now, the company is hoping to move into the oil and gas industry, an area where GCGE had little exposure before being selected for funding by RPSEA.
GCGE has been working for some time with the geothermal lab at Southern Methodist University (SMU), which is world renowned for geothermal energy research. “SMU vetted our technology and has been very helpful,” Loy said, noting that his company became aware of RPSEA through Maria Richards, SMU geothermal lab coordinator.
“I had no prior exposure to oil and gas companies,” Loy said. Through RPSEA, Loy gained not only exposure to the industry, but a new perspective on operating companies. “It was refreshing to discover we’ve got leaders in the oil and gas industry that are committed to conducting environmentally responsible activities with their technologies.”
The first of the two projects GCGE will be involved in is titled “Electrical Power Generation from Produced Water: Field Demonstration of Ways to Reduce Operating Costs of Small Producers.” The company will conduct a three-year demonstration project that generates electricity by capturing heat from water used in oil drilling to reduce the amount of energy needed without burning additional fossil fuels. In the process, GCGE will show how small oil drilling operations can cut costs and carbon dioxide emissions while increasing access to previously hard-to-produce oil resources,
“This technology will not only reduce emissions by producing ‘green’ electricity onsite that can be used in drilling operations, but will also reduce costs to small oil producers, making them more competitive in the marketplace,” Sneary said. “It will successfully demonstrate how to generate emission-free electricity from the hot water produced by gas wells that is typically a waste byproduct of natural gas production.”
RPSEA, along with GCGE and Denbury Resources, will fund the project as part of the 2008 Small Producer Program, which focuses on the challenges faced by small oil and gas producers.
The second project GCGE is involved in, the Environmentally Friendly Drilling Systems (EFDS) program, is one of nine projects selected out of 69 for funding by RPSEA’s 2008 Unconventional Resources Program, which supports projects that help meet US energy demands, create jobs, and lower costs to the consumers.
“The EFDS is part of an effort to identify, develop, and demonstrate cost-effective technologies that reduce environmental threats and could allow operations in environmentally sensitive areas that are currently off limits,” Sneary explained.
The plan is for GCGE to connect its “Green Machine” to the huge internal combustion engines on a drilling platform to capture exhaust heat and from the water jacket to generate electricity. “That capability is really attractive because we can generate up to 4 MW of additional power for offshore rigs and 400 kW for onshore rigs.” Sneary said.
Sneary is pleased, he said, with the attention GCGE’s technology is getting today from the oil and gas industry, attributing some of the recent interest to the current economic situation, which has created idle time for E&P companies that are not carrying out as much exploration activity as they did when the oil price was above US $100/bbl. “The economic climate is forcing companies to look at long-term opportunities through strategic growth, and they are recognizing that they can diversify without going very far outside the familiar,” he explained. “With 30-year equipment like this that pays out in three years or less, it is easy to see how much positive impact this can have on the bottom line.”
Both of the projects GCGE is involved in aim to demonstrate that electricity can be generated efficiently with waste heat generators. In the ‘small producer’ project, GCGE will use hot geo-fluids to generate electricity for the first time in the field even though the company has applied this equipment in other commercial capacities. “I think that is what was attractive to the RPSEA board,” Sneary said.
If the technology GCGE is introducing lives up to expectations, it has the potential to make a significant impact in the industry, and its success will encourage future collaboration.
“We’re excited about being a part of both of these projects where universities, environmental groups, and industry are working together to develop environmentally friendly solutions,” Sneary said.
Best of What’s New
Pop Science – Best of What’s New ’08
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Electricity that’s all hot air.
Electratherm’s closet-size device is the first machine to power generators with waste heat of as low as 200ºF, a temperature given off by common boilers or chillers in office buildings. (Industrial waste-heat recyclers require 1,000º blazes.) The heat boils refrigerants into a pressurized gas that spins two small, screw-shaped rotors. From $128,000
Original article from Pop Science at http://www.popsci.com/bown/2008/product/electratherm-green-machine
Geothermal Possibilities
Geothermal Possibilities
Will Texas oil and gas fields also produce geothermal energy in the future?
The Fort Worth Basin is now home to the nation’s largest natural gas field. But when the Barnett Shale eventually plays out, could those same gas wells become a source for electrical production from the earth’s heat?
“It is certainly possible,” replied David Blackwell, professor of geothermal studies at Southern Methodist University in Dallas (www.smu.edu/geothermal/). “The temperatures in the Barnett Shale are a little low for electrical power production, but at the present time there is waste heat from compression units, for example, that could be used.”
Blackwell said waste fluids from hydrocarbon wells can now be used to generate electricity for operators’ pumping needs with any additional electricity sold to utilities as renewable energy. A small (250-kilowatt or larger) electric turbine is attached between the separation stage and re-injection well. He explained that this can be done on one well or multiple wells with temperatures over approximately 225 degrees Fahrenheit and large amounts of water.
While the wells in the Barnett Shale have an advantage of being close to the electrical power grids for inexpensive connection, Blackwell said they don’t produce enough heat or water to generate much electricity at this time.
“It takes about 500 gallons (of water) a minute at 225 degrees to generate 250 kilowatts,” he stated. “The hottest temperatures in the Barnett wells are about 200 degrees, and most wells are producing only about 100 barrels of water per day instead of several hundred gallons per minute. I think deeper wells along the Gulf Coast and in east Texas are more likely candidates to produce electricity in the near term.”
Blackwell added that the pressure and flow rate of the natural gas itself in the Barnett Shale wells are not enough to generate electricity on their own, either. That is not to say that the Barnett Shale won’t play a role in the geothermal production of electricity in the future, however, especially after the shale gas plays out.
“Down the road, the government is very interested in heat extraction experiments,” he said. “After the Barnett plays out, there are a lot of interesting scenarios. The horizontal wells could be connected. You could pump water in one and out another with a managed system. Wells could also be re-fractured down to the Ellenberger aquifer to bring that water into the existing wellbore. They are trying to avoid the Ellenberger with their frac jobs currently to keep the water from getting into the well.”
The beauty of geothermal energy, according to Blackwell, is that it runs all the time and is not dependent on the sun shining or the wind blowing as are solar energy or wind turbines.
Blackwell said the petroleum energy is understandably focused on the production of natural gas in the Barnett Shale at this time as operators try to take advantage of high prices for the commodity. But interest in geothermal will increase as the play slows down, he asserted.
A tax advantage also exists for energy producers who can generate electricity at the well site. The federal production tax credit provides for a credit of 1.9 cents per kilowatt hour for each kilowatt hour of electricity produced for the electric grid, according to Blackwell.
Federal legislation extending the production tax credit through Dec. 31, 2008, provides the credit for wind, solar, geothermal, and closed-loop bioenergy facilities. Other technologies, such as open-loop biomass, incremental hydropower, small irrigation systems, landfill gas, and municipal solid waste, receive a lesser value tax credit.
Asked to peer into his crystal ball and predict what the Barnett Shale might mean for the geothermal generation of electrical power in the next five years, Blackwell countered, “It won’t be a major amount of electrical energy. Some other places in Texas are better candidates for geothermal energy. But I expect we will see several megawatts of electricity produced from the oil and gas industry in the Fort Worth Basin over the next five years.” Heating and refrigeration applications may come first as they require lower temperatures and could thus be more generally used, especially since much of the development is in an urban environment, Blackwell added.
While geothermal, wind and solar energy will produce only a small portion of the nation’s energy needs, all are green, meaning they won’t harm the environment, and all together they will add up to make a difference, according to Blackwell.
“It is important to get the first few things done to see if it can work,” he said. “Then we will see if it takes off like wind energy in West Texas.”
Waste energy
One example of taking an existing system and generating electricity is a project currently operating on the SMU campus. Gulf Coast Green Energy in Bay City is the exclusive distributor in Texas and Louisiana for ElectraTherm’s family of scalable power systems that converts low-grade waste energy into useable, electric power.
Loy Sneary, president and chief executive officer of Gulf Coast Green Energy, said one of his company’s units, a Waste Heat Generator, is sitting in the boiler room at SMU as a demonstration site.
“SMU is allowing us to demonstrate the unit on campus, which is the first commercial installation of the Waste Heat Generator,” he said. “Some of the hot water comes back after it goes through the campus, and it goes directly through our equipment and then back into the boiler. The heat goes through a heat exchanger, like a radiator. It is generating 50 kilowatts per hour. The advantage to SMU is that it can take that heat source and generate 50 kilowatt per hour (kW/h) of electricity that goes back into the grid. It uses no fuel and creates no emissions. It is like making something from nothing.”
Sneary also listed other uses for ElectraTherm’s Waste Heat Generator.
“We are working with a couple of companies to generate electricity from their non-producing gas wells,” he said. “The bottomhole temperate and pressure is enough to flow the geofluids (the normal brine that is either produced naturally or flows back after a well is fraced) to generate electricity. “One Louisiana company that we are working with has a gas well that has 100 gallons per minute geofluid flow at 200 degrees Fahrenheit. We can generate 30 kW/h from that well, and we are looking into connecting this well with two other nearby wells to generate a total of 90 kW/h.” We also have a conference call coming up with a company that has four big 3606 Caterpillar engines used in the compression of natural gas. We can take the water and heat from those engines and generate 460 kilowatt of electricity with no additional fuel or emissions. A project that we are working on in Louisiana uses a gas fired turbine to compress natural gas. Gas compressor turbines also put off a huge amount of heat. We can capture that and generate 1.5 megawatts of electricity.”
Another application in which Gulf Coast Green Energy is involved is a landfill in Austin.
“The landfill is currently flaring the methane gas it produces 24/7,” he explained. “We can take that flared gas and fuel a boiler. That hot water can generate 400 kilowatt per hour. That’s enough electricity to power 350 homes, just from methane gas that is being flared.”
Analyze this
Dallas-based Messina Inc. researches, designs and engineers the application of its chemicals – complete lines of chemicals and fluid systems — to drill, complete, workover, cement, stimulate and produce oil, gas, geothermal and water wells.
Company president Mario Messina is a geothermal energy enthusiast. He urges operators who have shut-in or plugged wells to do an analysis to see if the well is a candidate for producing electricity. Part of that analysis, according to Messina, is determining if the downhole temperature is hot enough and whether an avenue exists to run the fluid through the hot rock. He added that determining the cost also includes ascertaining what it will cost to transmit the electricity to the power grid. He said it also might mean re-fracing the well.
“You have to look at the total economic package,” Messina explained. “But most of the cost of geothermal energy is drilling the hole. If you already have a well, you are halfway there.”
Sneary, Blackwell and Messina agreed that the ability to generate electricity using geofluids from oil or gas wells depends on bottomhole temperatures and the amount of geofluids produced from the well.
But imagine the possibility of the salt water and brine produced from natural gas wells, which is currently being trucked away from Barnett Shale wells to disposal wells, being used instead to generate electricity, a clean, non-combustible, fuel-free, emission-free source of energy.
“We just want people to start thinking about the possibility,” Blackwell emphasized.
By Al Pickett, Special Contributor Basin Oil & Gas September 2008 Fort Worth
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