For 32 years, operators have injected CO2 (carbon dioxide) into Permian Basin oil fields to increase crude oil production. In fact, the Permian Basin is home to approximately 80 percent of the world CO2-based enhanced oil recovery projects.

For 32 years, operators have injected CO2 (carbon dioxide)
into Permian Basin oil fields to increase crude oil production. In
fact, the Permian Basin is home to approximately 80 percent of the
world’s CO2-based enhanced oil recovery projects.

As CO2 use has expanded, local CO2 users and suppliers organized
an annual CO2 Conference, the 11th edition of which will be held at the
Midland Center in downtown Midland Thursday, December 8 and Friday,
December 9. A field trip to the Yates Field will kick off the
conference on Wednesday, December 7.

This year, said Steve Melzer, conference chairman, high
commodity prices ‘have created a lot of desire on the part of existing
CO2 companies, and those on the sidelines, to implement new projects or
expand existing projects.’

However, he said, this year, ‘limits on CO2 supplies are staring
us in the face for the first time,’ and those supply limits are placing
constraints on project implementations or expansions.

One cause of those limits is constraints on the Cortez pipeline
that brings CO2 to Permian Basin fields; other causes are declining
production from source fields like the Bravo Dome.

‘I don’t see relief from those original source fields,’ Melzer said.

Yet another cause is found behind the scenes, in older Permian
Basin fields that were placed on CO2 flood 10 or 20 years ago — or
longer — and were expected to have rolled out of the CO2 pipeline by
now, Melzer said.

Those fields, like the Wasson, the Slaughter, the Seminole, the
SACROC, are very profitable, he said, and their operators are showing
‘no desire to slow down’ CO2 injection.

‘Those fields are as busy as they’ve ever been, and that leaves
no room for the new kids on the block,’ Melzer said. ‘That’s true not
only in the Permian Basin but in Wyoming, North Dakota, Saskatchewan
and Mississippi.’

Panelists at this year’s CO2 Conference are expected to discuss the supply dilemma and seek solutions, he added.

Over 300 are expected to attend this year’s conference, which
has drawn attendees from Europe, Scandinavia, China and the Middle East
in the past. Melzer said he just received word that a representative of
Occidental Petroleum in Abu Dhabi will attend and give a presentation.

‘I’ve heard about projects in India, Thailand and Indonesia,’ he
noted, adding that CO2 in other countries is usually a by-product of
natural gas production.

The use of CO2 in this country is driven largely by the desire
to recover more oil, both to meet demand and for national security
reasons, while other countries are turning to CO2 largely for
environmental reasons, especially those nations that have signed the
Kyoto Treaty, he said.

This year’s conference will be divided into three theme
sessions, with the first, ‘CO2 Flood Operations and Sourcing Issues,’
opening the conference Thursday morning. Chuck Fox with Kinder Morgan
CO2 will open the session, followed by a recap of the third annual
Carbon Management Workshop held prior to the conference and a
discussion of cement integrity in the SACROC Unit. A panel discussion
comprised of CO2 suppliers from Kinder Morgan, Trinity, ExxonMobil, the
Bureau of Economic Geology and PetroSource Energy will lead into lunch.

The afternoon session will focus on CO2 flood planning and case
histories, including presentations on Denbury Resources’ East
Mississippi CO2 project, the Rangely Weber Sand project in western
Colorado, CO2 and enhanced coalbed methane and a proposed new injection
scheme for CO2 flooding. The day will end with a reception at the
Museum of the Southwest.

On Friday, December 9, the third and final session will focus on
technology and the future of CO2 flooding. Presentations will cover the
Canadian Miscible Hydrocarbon Floods, vertical CO2 flooding;
development of relative displacement curves for miscible reservoir
simulation; the next generation CO2 flood and reserve booking
guidelines for CO2 floods. Following a light lunch, the conference will
conclude around midday.

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