Gas hydrates could be the key to our energy future. Or they could spell ecological doom.
THE PUZZLE OF FROZEN GAS
Gas hydrates could be the key to our energy future. Or they could spell ecological doom.
Some years ago, while out exploring the deep waters off Vancouver Island, an experimental fishing trawler dredged up something unusual: a 450-kg shard of opaque white ice that, as it rose to the surface, burped, foamed and fizzed madly. On deck, it popped and crackled like a log on the fire, lathered into a gassy froth, and
belched methane, prompting one sharp provincial official on board to warn the fishermen of smoking. Photographs of the episode show the men, frozen red snapper at their feet, hastily shovelling the mysterious slush overboard into a sea of hissing foam.
The trawler had unknowingly netted a piece of what will either become a staple of our energy future, or a new cog in the engine of planetary climate change—a chunk of gas hydrate. Widely dispersed on ocean floors and below Arctic permafrost, hydrates are gases—usually methane—packed at high density in water molecules, a combination that
looks a lot like ice, though this stuff freezes at temperatures above zero and can be lit with a match. If only we could liberate that caged methane and do so economically—tall orders both—gas hydrates pack an energy wallop 164 times that of the same amount of natural gas but are cleaner burning, emitting just half the C02.
Though little is known of Canada’s endowment or anyone else’s, the geological conditions that form hydrates are so widespread that early estimates suggest they could represent a source of energy as large as all the planet’s conventional hydrocarbons combined—“an enormous resource that could supply modern economies for the next thousand years or more,” as Benoit Beauchamp, executive director of the Arctic Institute of North America at the University of Calgary, puts it. Even if such initial guesswork is deemed too high (most hydrates, particularly those at the bottom of the oceans, will likely remain beyond our reach for some time to come), it still represents an enormous opportunity.
In this country alone, according to Natural Resources Canada figures, hydrates represent at least 1,500 and perhaps as much as 29,000 trillion cubic feet (Tcf) of natural gas, impressive when compared to our remaining conventional natural gas holdings of just 370 Tcf. “If you take conventional natural gas resources as your fingertip and unconventional gas as your whole body, then resources for hydrates are the size of the city of Calgary,” says Bill Gwozd of Ziff Energy Group. Similar deposits elsewhere in the world have energy-poor nations like Japan, South Korea, India and China, with their hydrate-rich coastlines, investing heavily in R & D—mainly seismic surveys to locate the stuff and drilling to assess the deposits.
All good news. But gas hydrates may also be trouble. Methane, between 10 and 30 times more efficient a greenhouse gas than C02, has for millennia gathered in these icy, undersea and Arctic traps, where temperature and pressure conditions conspired to keep them earthbound. A great, global-warminginduced thaw could lead to eons-worth of really bad gas getting into the atmosphere— and to runaway global warming. “This is something most of us think is highly unlikely, but the consequences are so severe one doesn’t want to dismiss it completely,” says Roy Hyndman, a senior research scientist at the Pacific Geoscience Centre, a branch of the Geological Survey of Canada.
Even still, Russian scientists at a European Geosciences Union conference in Vienna this spring presented evidence of just such a meltdown beneath a body of water off Siberia roughly six times the size of Germany; they estimate the earth’s atmospheric methane
content could jump twelvefold should the underwater formation’s icy shell thaw entirely. Increasingly higher methane readings in Canada’s Far North, meanwhile, could similarly be linked to hydrate deposits destabilized by rising temperatures, says Beauchamp, who notes that evidence for such phenomena has been uncovered deep in earth’s history, in the geological record.
So why not use our hydrates before that happens, then? Tempting, but a formidable challenge—try tearing the bubbles from a frozen bottle of champagne—due to the peculiar snap-crackle-and-pop personality of hydrates and the remote, harsh environments where they tend to live. Two kilometres or more beneath the oceans, where India and Japan must concentrate their efforts, hydrates actually form part of the seabed’s structural integrity; digging up that ancient ice might cause sea-floor collapse and, worse, underwater earthquakes.
Or take Canada’s easiest hydrate target, in the MacKenzie Delta—thousands of trucking kilometres away from southern luxury and known for its hydrate-heavy geology ever since Imperial Oil experienced an unexpected and dangerous surge of methane while drilling through the permafrost decades ago. Over the years scientists have conducted a number of experiments looking at how to unlock those hydrates, focused initially on steaming the methane out using methods like those in Alberta’s oil sands, where thick tar-like bitumen must be warmed before it gives up its crude. Yet poor results and the fact so much energy is needed to melt the deposits (an environmental drawback yet to faze oil sands operators) drove scientists back south to their drawing boards.
Heat didn’t work. Why not lower a deposit’s pressure, the other force that cages gas in ice? In March, scientists with Natural Resources Canada, in partnership with Japanese colleagues, trekked up to the high Arctic to see whether conventional oil and gas equipment, used in a novel way, could untap hydrate gas doing just that. By drilling 1,000 m deep below the permafrost, threading and cementing pipe down into the well, then punching holes in that pipe to depressurize the depositsending gas fizzing upwards—the team managed six days of continuous, stable production—a historic first. “It certainly demonstrated that gas hydrates can be produced,” says Scott Dallimore, the Geological Survey of Canada scientist who lead the project.
But the Mallik endeavour, the latest in a series of experiments at the site over the past decade or so, was worthy of a David Lean
epic: Dallimore’s crew hauled an Albertabased rig all the way up the Yukon’s Dempster Highway, laid 180 km of ice road from Inuvik to a spot on Richards Island facing the Beaufort Sea, then weathered wind-chill ternperatures that sometimes dipped as low as -64° C. The undertaking cost upwards of $70 million, with much of that money supplied by the Japanese, who like Mallik for its relative convenience. Now the Japanese are keen to apply their Arctic success to the even less forgiving conditions of the Nankai Trough, a deep-sea spot off the coast of Japan’s largest island, where they hope to begin hydrate production by 2019. But such hardships— northern cold, fathomless depths worthy of Jules Verne—are the kinds of things that could keep Canadian industry from exploiting hydrates here and other places too.
Despite the proof of concept in Mallik, another hurdle remains technical. “I think gas hydrates are right now, in 2008, where the oil sands were 40, 45 years ago—a bit of a pipe dream,” says Beauchamp. “Especially while there’s still conventional and unconventional gas around.” The Mallik experiment achieved results similar to those of most coal-bed methane wells—100,000 to 150,000 cubic feet (Mcf) a day, likely even less than that. “That’s probably not economic,” says Mike Dawson, president of the Canadian Society for Unconventional Gas. “There’s an awful lot of R & D and exploration required prior to us actually cracking that technological nut.”
Some of this work is being done by industry, but not much. Last year, at Milne Point in Alaska, BP partnered with the U.S. Department of Energy to drill a research well, dredging up hydrate core samples; the DOE bankrolled the project, shelling out $4-6 million. Canada’s federal government, meanwhile, is perhaps not yet backing the hydrate file with similarly appropriate dollars. While the DOE invested a total of US$16 million into hydrates this year, we invested a paltry $1.3 million, though we’re meant to be world leaders in the field. That’s a shame, considering how quickly we’re depleting our conventional natural gas reservoirs and how unsteady and expensive our unconventional deposits—shale gas, tight gas, coal-bed meth-
ane-may well prove to be. Given the technical challenges of ripping the gas from its icy Arctic lodgings, it’s hard to believe that won’t be the toughest part of getting at our hydrates. Harder still will be getting the gas to market, particularly without infrastructure like the Mackenzie Gas Project, a pipeline now projected to cost $16.2 billion and due to start pumping gas in 2015—if it ever gets built at all—or the Alaskan line, all $2 6.6 billion worth of it, slated to begin operation in far-off 2018. “The economic rate that you have up there is going to be defined by your transportation vehicle, whatever it may be,” says Dawson. Only governments can be expected to see beyond the worries of cranky shareholders and the upcoming quarterly report to invest in that infrastructure and costly research. BP and others likely won’t.
Indeed, so myriad are the worries that many observers don’t believe hydrates will get tapped any time soon. That’s doubly clear, say the skeptics, with the swift rise of liquefied natural gas, or LNG (gas chilled to -1500 C), when it assumes liquid form, by producers in Qatar, Trinidad and Tobago, Indonesia, Australia and elsewhere, then shipped by ocean-going tankers to buyers around the world. “That’s the low-hanging fruit,” says Dave Vetsch, an associate at Ziff Energy Group, of LNG. Hydrates, on the other hand, are “at the very top of the tree,” he says. “It will take a long time before this stuff becomes low-hanging fruit because
EXTRACTING GAS FROM HYDRATES IS LIKE TRYING TO RIP THE BUBBLES FROM FROZEN CHAMPAGNE
we’ve exploited everything else.”
But such faith in LNG assumes it will remain inexpensive. “A lot of people who are pooh-poohing gas hydrates believe LNG is going to be the cure, the silver bullet, that will allow us to be sustainable in North America,” says Dawson. “It isn’t going to happen—there isn’t enough LNG developed to handle demand.” By the time Canada exhausts its supply of natural gas, in 30 years or so, LNG won’t be nearly so cheap. China and India’s growing energy appetites and the growing taste for natural gas as a greener fuel among European nations will make sure of that. Even now, international competition for the commodity can drive prices up abruptly, particularly after upsets like the earthquake in Japan last summer that crippled a major nuclear power plant. “Tankers are literally sitting out there in the middle of the ocean, waiting to find out where they should divert their ship and drop their cargo,” says Dawson. They head for the highest bid-
der. “They’ll gauge as much as possible—they’re mercenaries,” says Ziff Energy’s Gwozd.
Yet, oddly enough, LNG could well be the answer to the transportation problems posed by Canada’s remote North, where lots of conventional natural gas sits along with (and often adjacent to) gas hydrates. If southbound MacKenzie and Alaskan pipelines cost even more than filling up your Hummer does these days, LNG infrastructure is relatively inexpensive-about $5 billion from point A (the liquefi-
cation plant) to point B (re-gasification and trucking to market). Global warming, meanwhile, is busy clearing the northern seas of ice, easing the way for tankers. Last summer, the Northwest Passage was decidedly more ice-free than at any other time in recorded history. Scientists predict that much of the Arctic Ocean will be clear for several months each year by 2020. Hauling hydrates via the Arctic to eastern ports in Quebec, say, where natural gas is especially needed, could be the future.
Indeed, it better be—for the good of Canada’s territorial integrity. Canadian ships zipping through the Northwest Passage with cargo sucked up from Canadian gas wells— either conventional or more futuristic targets like gas hydrates—would help ensure we continue to hold on to our Arctic. “If Canada was the first nation to ship gas from its own gas fields across the Northwest Passage, that would establish our claim without much doubt,” says Beauchamp. “On the other hand, if it’s the U.S., that would be a big dent in our ability to assert sovereignty up there.” So the race is on. Meanwhile, just wait 15 years or so—Canadians might just be heating their homes with Arctic ice. M
HYDRATES COULD REPRESENT AN ENERGY SOURCE AS BIG AS ALL OTHER HYDROCARBONS COMBINED
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