Will Anchorage be left out in the cold?
Geological data, according to Charles B. Barker,
research geologist with the U.S. Geological Survey in Denver, indicates
that unless something is done quickly, Anchorage will be out of
heat and electricity in seven to 13 years.
That's when the natural gas in the area around Anchorage
will run out, Barker said.
Actually, the shortfall could begin as early as 2005,
he added, for peak use comes during the winter, and there is not
enough storage capacity. The estimates are based on the current
annual consumption rate of 220 billion cubic feet (BCF) in the Anchorage
area.
So why not just find some new natural gas fields
in the area?
"New reserves have not been found that equal current
consumption since the 1980s," Barker said.
Added to that, of course, is the ongoing factor of
how energy companies have also been discouraged from further exploration
in the area — especially now, since the gas prices there are lowest
in the 50 states. When there was a price spike in early 2001, gas
prices in the lower states reached nearly $10 per cubic foot, while
in the Anchorage area the price reached only $1.80.
Another contributing factor, Barker said, is that
there is no pipeline leading to the outside to sell potential additional
discoveries. Anchorage is a stranded market that uses the gas for
basically three reasons:
- A fertilizer plant.
- A liquefied natural gas facility.
- Heating and electricity for Anchorage.
Pros and Cons
One option to help this situation is simply to bring
in lines from the North Slope to supply Anchorage. Simple, but not
without a price.
"The general consensus is that would be too expensive,"
Barker said.
Therefore the most feasible alternative, Barker continued,
is to develop coal bed methane (CBM), which is in the Anchorage
area.
The pro to this option, Barker said, is that "you
can produce nearly pure methane at very inexpensive wells that can
be developed very quickly."
Also, the region's existing pipeline system covers
many of the onshore coal fields, so a new infrastructure need not
be developed.
The main con: "You will have a lot of water produced
with dissolved chemicals that has to be disposed of," he said.
The current history of coalbed methane exploration
in the Cook Inlet region had its beginning and continues as a cooperative
effort of the Alaska Department of Natural Resources and USGS. In
1994 the department used a USGS drill rig to drill AK-94, the first
coalbed test in the area, near Wasilla. Desorption tests of core
from this well used USGS canisters and methods modified for improved
temperature control.
The results indicated 40 net feet of coal at less
than 1,300-ft. depth, averaging about 160 standard cubic feet per
ton (SCF/T), on a dry, ash-free (DAF) basis.
The resource estimate, Barker said, is about 140
trillion cubic feet (TCF) of gas in place.
"If 10 percent of this resource is accessible for
production and 50 percent of the accessible resource is recoverable,
then the geologically indicated reserve is about seven TCF," Barker
said. "This is a 30-year supply to south-central Alaska based on
the current 220 BCF/year consumption."
These discoveries provided incentives to energy companies,
especially Unocal and Ocean Energy, which were the first to show
signs of interest. They found good gas content, but they also found
poor permeability and had difficulty completing the well.
That would seem to be a bad sign, but in fact the
firms have sold their leases to companies that are currently active
in the region — including Evergreen Reserves, Phillips, Marathon
and Forest Oil.