Prospective Evaluation of Applied Energy Research and Development at DOE (Phase Two) (2007) / Chapter Skim
Currently Skimming:
Appendix J Report of the Panel on DOE's Natural Gas Exploration and Production R&D Program
Appendix J Report of the Panel on DOE's Natural Gas Exploration and Production R&D Program
Pages 152-170
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 152... ...
, the Panel on Benefits mittee's consultant to apply the committee's methodology to of DOE's Natural Gas Exploration and Production Program estimate overall technical and market risks and prospective (the panel; see Attachment A) was appointed by the National net benefits to the nation for the E&P program as a whole.
|
From page 153... ...
The FY05 budgets for the key subprograms for enhancing assessmeNT oF The NaTural Gas eXPloraTioN domestic supply in DOE's program were as follows: aNd ProducTioN ProGram The committee's methodology suggests that an assess 3Economically recoverable resources are resources, both discovered and ment of the benefits of a specific subprogram should explicundiscovered, that are economically extractable under a given set of price itly consider the role of DOE funding and the technical risks to-cost relationships and technological assumptions. DOE defines ERR as and market risks that can affect the outcome and the value of resources that can be found and produced profitably at a given point in the future at prevailing prices estimated by the Energy Information Administra- that subprogram's activities.
|
From page 154... ...
in estimating the probability of technical and It is unclear to the panel how much of this research on infill market success: the AEO Reference Case scenario; the High drilling and composite drill pipe is directed at marginal Oil and Gas Prices scenario, where gas prices are assumed wells. to be twice those in the AEO Reference Case; and a Carbon Ongoing efforts focused at the well level (through NETL's Constrained scenario, where a $100 per ton carbon emissions Stripper Well Consortium)
|
From page 155... ...
Values under each branch are the average of the panelists' estimates of the probability of that technical outcome for the Reference Case, the High Oil and Gas Prices, and the Carbon Constrained scenarios, respectively.
|
From page 156... ...
Results of Panel Assessments DOE AEO Reference High Oil and Gas Carbon Constrained Subprogram Estimate Case Scenario Prices Scenario Scenario Existing fields 7 1.8 2.6 2.7 (0.7 to 3.2)
|
From page 157... ...
The DOE natural gas R&D program has been playing a Currently budgeted at $1.5 million for FY05, Deep Trek will very important role in applying advanced seismic imaging benefit industry with a diverse number of program areas that methods to unconventional gas fields. The DOE program enable access to resources below 20,000 feet, including but directed its limited resources wisely to get the most for its not limited to investment.
|
From page 158... ...
Drilling Costs 2015 due to DOE R&D 13 Tcf 12%, 20%, 18% 7 Tcf 5% 37%, 41%, 39% 2 Tcf 22%, 31%, 29% 45%, 35%, 38% No increase 5%, 4%, 5% 13 Tcf 5%, 8%, 11% 7 Tcf 3% 38%, 41%, 39% 2 Tcf 37%, 50%, 50% 46%, 40%, 39% No increase 11%, 11%, 11% Yes 13 Tcf 1%, 3%, 2% 7 Tcf 1% 3%, 33%, 33% 2 Tcf 38%, 19%, 20% 52%, 47%, 47% No increase 17%, 17%, 17% 13 Tcf 0%, 0%, 0% 7 Tcf No decrease 0%, 0%, 0% 2 Tcf 3%, 0%, 0% 0%, 0%, 0% No increase 100%, 100%, 100% No No cost decrease or ERR increase: outcomes are defined as changes due to DOE's R&D program FIGURE J-2 Decision tree for the drilling, completion, and stimulation subprogram. Values under each branch are the average of the panelist's estimates of the probability of that technical outcome for the Reference Case, the High Oil and Gas Prices, and the Carbon Constrained scenarios, respectively.
|
From page 159... ...
Values under each branch are the average of the panelist's estimates of the probability of that technical outcome for the Reference Case, the High Oil and Gas Prices, and the Carbon Constrained scenarios, respectively. impact.
|
From page 160... ...
Currently, there are only two substantial companies would be able to participate in drilling for deeper very deep gas plays in the nation: (1) the deep Norphlet play gas resources without DOE R&D, fewer resources would be around Mobile Bay in the eastern Gulf of Mexico, with 7 developed for consumers, and gas prices would probably be Tcf, and (2)
|
From page 161... ...
Values under each branch are the average of the panelist's estimates of the probability of that technical outcome for the Reference Case, the High Oil and the Gas Prices, and the Carbon Constrained scenarios, respectively. resulTs aNd discussioN individual estimates of increase in ERR attributable to the program.
|
From page 162... ...
estimates are a simple scaling of DOE's estimates, based on DOE estimates the economic benefits of its R&D program the ratio of DOE's estimate of increased ERR to the panel's as the total consumer energy savings resulting from the estimate of increased ERR attributable to the program, and increased domestic natural gas production attributed to the the fraction of increased ERR assumed to become increased program. For each year, DOE estimates a change in natural production from DOE's benefits analysis.
|
From page 163... ...
and benefits of DOE's natural gas exploration R&D program. of natural gas at the expense of other fossil fuels results in Benefits are calculated as described in Chapter 3 and are environmental benefits.
|
From page 164... ...
At the relatively modest level of increased production Program Benefits envisioned for this program alone, environmental benefits are expected to be modest. Security Increased domestic natural gas production partially offsets gas imports.
|
From page 165... ...
The panel recognized the substantial benefits of increased and industry to share the cost and execution of the needed consumption of natural gas relative to that of other fossil fuels R&D, with the government contributing, as appropriate, its and notes that the United States, and indeed the world, is at expertise in this matter. the threshold of a methane economy, where natural gas, both Increased domestic natural gas production partially off- as a clean, efficient fuel and as a source of hydrogen, is the sets natural gas imports.
|
From page 166... ...
As director of the Potential Gas Agency, he di rects a team of 145 geologists, geophysicists and petroleum Recommendation: As the natural gas program changes under engineers in their biennial assessment of remaining U.S. the EPACT-2005, DOE, in following up on the methodology natural gas resources.
|
From page 167... ...
in chemistryzontal drilling techniques, which significantly increase oil biology from Bishop's University, in Canada, an M.Sc. in and gas production, and advanced drilling software, which agricultural biochemistry from McGill University, and a improves drilling operations and reduces drilling costs and Ph.D in marine biology from the University of California, environmental impact.
|
From page 168... ...
the net change in total consumer and proposed by DOE.8 producer surplus is equal to the area of the dark gray triangle. Note that the area of the shaded triangles will not necessarily be equal, differing by the area of the triangle formed by the demand curve, the modified supply curve, 8John Pyrdol, economist, DOE Office of Oil and Gas, "Assessing the and the horizontal line corresponding to the price P1.
|
From page 169... ...
A reasonable estimate of on the drilling, completion, and stimulation subprogram the cost reduction thus may be the middle value provided for (decision tree shown in Figure J-2) provides a starting point.
|
From page 170... ...
The DOE program is assumed to result in a decrease in the costs of production for ∆Q units of gas that were not economic to produce absent the DOE program. The cost of this marginal gas assuming no technical improvements from the program is shown by the initial supply curve to the right of the preprogram equilibrium price (P1)
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.