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Gas to power game changer

Written by  Elaine Maslin Sunday, 01 October 2017 00:00

A Dutch initiative is looking to combine gas to power production with CCS to unlock marginal fields on the Dutch Continental Shelf. Elaine Maslin reports.

Images from Circular Energy.

Like the rest of the North Sea, the Dutch Continental Shelf is in a mature phase. Existing resources are dwindling, new discoveries are ever smaller, and there are many smaller gas pockets which may be left stranded due to a lack of export infrastructure – and what’s there is getting ever closing to being decommissioned.

Meanwhile, a new electric power system is becoming increasingly evident. The Dutch government hopes to reach 4500 MW capacity from offshore wind by 2023. It could be a grim outlook, unless you’re Arnold Groot, director of Circular Energy.

Instead of producing gas and sending it down export pipelines – the cost of which limit the development of many marginal fields – Circular Energy wants to turn the gas to power, at source (a production facility), then export the power via the increasing number of power export systems being built for offshore wind. CO2 produced in the process would be re-injected into the reservoir.

The firm, which was founded last year, is already working on a field development plan and hopes to be able to produce first gas/power in 2020.

Groot came up with the idea while working with Petro-Canada in the Netherlands. He noted that the Dutch Continental Shelf was small and operating in such a way that many smaller discoveries might never be developed.

Arnold Groot

“If you change the concept, you may open up additional opportunities for development and production. Having gas to power with CCS is the game changer. This is because one installation produces the gas, turns it to electric power, captures and re-injects the CO2. Contrast that with the classic ‘end of pipe solution’ where you take an existing power station and add CO2 capture technology. This means investment in CCS facilities near to the stack, investment in a flowline to an offshore reservoir, and investment in injection facilities. It’s additional capex and no additional revenue and entirely dependent on CO2 prices and government subsidies.”

“With an integrated approach, you reduce the capex because you don’t need the flowline. We are sitting on our own waste disposal bin, injecting into the reservoir we’re producing from, which reduces capex on flowlines that need to be made from exotic materials because CO2 is corrosive in the presence of free water.” Because the power plant, CCS and injection are co-located, efficiencies can also be made, he says. “The CO2 can be easily captured as part of one unit, not as an afterthought. We also generate additional revenues because we are developing a gas discovery and sell power from that. This is gas that otherwise would not have been produced.” Furthermore, the power from gas could help level out demand/supply at times when the wind isn’t blowing.

The CO2 would be injected into the same reservoir. The advantage is that you’re putting back the same volume, Groot says. “The challenge is to prevent recirculation,” he says. “As soon as the flow from the injector goes into the producer you will be recirculating CO2, which will be detrimental to the efficiency of the scheme.” The firm has technology in development to prevent recirculation by preventing the mobility of the CO2 in the reservoir. But, “We need to prove that this works,” Groot says. A patent is in place to cover Europe and includes Denmark, the UK and Norway.

Groot says that the scheme, while not as profitable as a standalone gas development, would mean stranded fields could be developed and it wouldn’t need subsidies. The project has research funding from innovation programs in the Netherlands, but once commercial, it would stand on its own, he says.

The sweet spot is where there are small fields, close to power export facilities (i.e. offshore wind transformer station) in shallow water, Groot says.

Circular Energy’s concept.

Initially, the firm was looking at producing a mobile unit, which would go from field to field, tapping fields of around 1-2 Bcm. These are stranded due to having modest reserves in relation to the nearest gas export infrastructure. “The distance drives the economics,” Groot says. “For us, it isn’t stranded if it is remote from gas export facilities. For us, it’s stranded when it’s remote from wind farms.”

This concept is still being assessed, but having been approached by the operator of a 4.4 Bcm gas field, the firm is working on a development plan for a fixed facility concept, with a 20-year life.

There is a potential issue around the power export facilities, which, in the Netherlands, tend to be state-owned with access on the basis of offshore wind power being given preference. Groot’s concept therefore also means that larger capacity export facilities able to accommodate the power from gas is preferable. Part of the work on the topsides facilities will be to make sure production can be ramped up or down to smooth out wind power peaks and troughs. Groot also hopes that the concept could be unmanned – i.e. controlled from shore, further reducing costs – but there would be some complexities to overcome around maintenance and operation, which might make it easier to man it, at least initially.

In the 4.4 Bcm project, with 175MW installed capacity, Groot says that studies show that the gas to power plant could operate 75% of the time equivalent “flat out.” The remainder of that time the wind power output would be too high to accommodate the power from gas. The firm is working with CB&I on topsides design.

“It’s essentially a small gas production facility with power plant and carbon capture facilities. Gas production has been done for 80 years, power plant is 150 years old, and CO2 capture isn’t especially rocket science.

“We are keen to make sure this works in offshore conditions. With the projected growth of power export facilities in the North Sea, this is likely to generate a great number of opportunities. I’m convinced the greater share of domestic energy use in the future will be from electric power.”

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