One might say we can build a bridge to the future with “E”s: Exploration, economics, environment and energy.
As America cleans up its act energy-wise, coal and natural gas assume growing roles in meeting present and future needs, according to AAPG experts on both resources.
They are:
- Brian Cardott, who chairs the Energy Minerals Division Shale Gas Committee. He is a coal geologist with the Oklahoma Geological Survey.
- Robert C. Milici, with the U.S. Geological Survey in Charlottesville, Va., who chairs the EMD Coal Committee.
Huge North American supplies make both coal and gas more attractive as oil prices pierce record levels and petroleum becomes more subject to geopolitics.
How do these two industries stack up against the four Es?
Exploration
North America leads the world in known and predicted reserves of both resources, Milici and Cardott said. Much like coalbed methane in the 1990s, gas shales have captured headlines in the 2000s.
Production from the Barnett Shale in Texas’ Fort Worth Basin began in earnest in 1991, but has boomed recently thanks to advances in technology.
Late Devonian shales in Oklahoma and Mississippian shales in Arkansas hold large resources, Cardott observed, and other discoveries are turning many non-traditional areas across the country into gas producers.
“Not every hydrocarbon is recoverable,” he said. “Successful production depends on fracturability.
“We’re learning something new all the time (about shale gas),” he added. “You need source rock – you must fracture it and keep the fracturing within a particular zone so as not to bring in water.”
Fracturing multiple wells simultaneously and viewing fractures in real time using microseismic techniques have bolstered success rates, he said.
Shale gas “is a very technical play in terms of completion and exploration,” he said – and although reserve estimates remain somewhat hazy, Cardott believes “the operators have a pretty good idea of gas-in-place.”
More data would be public with increased government sponsorship, he added.
Despite decades of exploration and identification, some questions also surround coal reserve estimates, Milici said.
Some estimate enough coal remains unmined to meet U.S. energy needs for the next two centuries, he said.
One problem: “We don’t have coal beds in digital formats,” Milici said. “We’re relying on old research.”
Economics
As the U.S. coal industry moves westward, it drags economic effects along with it.
“It looks like eastern resources are in decline ... we’ve seen this over the last few decades,” Milici said. “There are huge amounts in the Illinois Basin.”
Coal quality can vary from region to region, affecting costs down the line. Compliance codes and local politics also impact coal from mining through power generation, he said.
Crystal ball time: “In the future – this is my bias – we have to look at coal-to-liquids technology,” Milici said.
Blending coal and petroleum liquids for fuel reduces demand on imported oil, he said, and diesel from coal is a proven technology that may be needed “to keep the economy from crashing.
“As demand increases and resources decline, we will have to rely more on technology to remove it,” Milici said.
Despite the challenges, the price of coal makes it an electricity-generating bargain “that we just can’t walk away from,” he said.
Cardott observed that “natural gas doesn’t require extensive cleaning processes, but exploration and extraction costs can be high.”
Tax credits initially aimed at safety issues spurred coal bed methane research in the 1990s and “revolutionized” shale gas findings in the 2000s, he said.
“Peak oil and gas production ... we know that’s coming,” Cardott said. “We may be able to extend that (with advances in E&P), but it’s going to be expensive.”
Environment
“Natural gas is viewed as environmentally more clean (than coal),” Cardott said, “(but) that’s not to say there aren’t issues.”
The United States has the largest resource of oil shale in the world, so “it’s more a matter of getting it out of the rocks in an environmentally clean manner,” he said.
“The technology is there to make coal cleaner,” Milici said. “Carbon dioxide is another matter.”
The problem is CO2 creation from burning coal or coal-derived liquids, Milici explained, which is about twice as much as that produced from natural gas.
“We really have to tie this in to sequestration (storing CO2 in geological formations),” Milici said.
Energy
Coal is cheaper, natural gas is cleaner, but neither will last forever, experts on both sides agree.
“We need nuclear in the mix” for power generation, Milici said.
The eventual goal is “real-time energy,” he added, “earth and solar power.
“My main concern is conservation – training the public to conserve our precious carbon-based resources,” Milici said.
“The EMD covers unconventional resources that include coal, coalbed methane, oil sands, geothermal, gas hydration and uranium,” Cardott pointed out. “We’ll need them all in the future.”
Cardott listed three issues as key to the energy future:
- Conservation – “Conserve where ever we can,” he said.
- Efficiency – Make and market products that deliver the same value while using less energy.
- Alternate fuels – Continue to research, develop and use unconventional resources.