Abstract

For Appalachian coal mines, the totaled methane emission rates exceed 180 MMCF/D, with active mines pushing deeper into virgin seams having higher relative gas contents. While most of this gas currently is vented into the atmosphere to prevent gas-related explosions, the technology prevent gas-related explosions, the technology exists to develop this valuable gas resource either in conjunction with mining or independently.

In 1977, the U.S. Department of Energy (DOE) began the Methane Recovery from Coalbeds Project (MRCP) to characterize and help encourage utilization of this resource. Since the projects inception, TRW has been involved in the collection and analysis of data, and is in the process of forming a coherent picture of the coalbed methane resource potential for the entire Appalachian region. Preliminary analysis indicates an estimated in-place coalbed methane resource in the Appalachian Basin of up to 150 TCF. Eastern coal operators are beginning to better understand the production potential of coalbed methane. In production potential of coalbed methane. In Buchanan County, Virginia, the Island Creek Coal Company produced up to 434 MCF/D from 12 horizontal boreholes drilled into the mine face. In Alabama, U.S. Steel's mines recently began commercial production and sold 25 MMCF of pipeline quality gas production and sold 25 MMCF of pipeline quality gas in December of 1981.

This study examines the recovery economics of coalbed methane, and specifically addresses the cost implications of pipeline hook-up. An analysis which addresses the size of a project, pipeline construction costs, and anticipated contract gas price helps determine an economical project-to-pipeline hook-up distance.

Introduction

Several of the recent commercial ventures to capture coalbed methane gas have involved horizontal boreholes drilled into a mine face. Underground coal miners have been the first to transform what was once a hazard into a profitable energy resource. But even owners of coal resources generally considered unminable could profit from the methane emitted by the coal seams. In addition to gathering information about the in-place resource in the Appalachian Basin, TRW has made several assessments of the economics of vertical wells into unminable coal seams. A realistic analysis of economically viable commercial-scale ventures involves gathering site-specific coal resource data, making production estimates, and formulating cost projections to incorporate into a discounted cash flow analysis.

The goal of this study was to examine the economics of basin-specific commercial-scale projects, and the viability of constructing a projects, and the viability of constructing a hook-up pipeline to get the resource to market.

METHANE RESOURCE DATA

Since 1977, TRW has been involved in the collection and analysis of data for the DOE's MRCP, and has formed an overview of the coalbed methane resource potential for the entire Appalachian region.

The Appalachian Basin's coal-bearing area extends over portions of nine states (Figure 1). The area has been subdivided into the Northern Appalachian, Central Appalachian, and Black Warrior Basins, covering an estimated 44,000, 23,000, and 35,000 square miles, respectively.

The potential methane resource of the three basins has been estimated, based on available information from degasification tests performed in advance of coal mining operations, mine emission data published by the U.S. Bureau of Mines (USBM), commercial project information, and methane content data of coal cores sampled by desorption analyses. These data have been used to delineate target areas with high potential for future development of the coalbed methane resource.

Basic data, mentioned above, has been used to develop resource estimates for the Northern Appalachian, Central Appalachian, and Black Warrior Basins.

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