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RIP easy oil and gas

Hydrocarbon Engineering,

Oil and gas are two of the main fossil fuels powering the world, currently accounting for close to 50% of total primary energy demand. While the total remaining recoverable resources are estimated to last for almost 200 years, we are facing an annual oil depletion rate of 8%, making it hard to anticipate how we can meet demand that is expected to increase by 28 million bpd by 2040

According to the International Energy Agency (IEA), 42% of worldwide recoverable gas is unconventional and three quarters of ultimately recoverable resources will still remain to be recovered in 2035. The global reserves-to-production ratio of conventional gas based on current consumption levels is in the range of 55 to 60 years.

As far as oil is concerned, even with discoveries of new proven reserves, oil prices continue to rise as we deplete a finite natural resource. Even with these additional documented reserves, 40% are hard to reach offshore – two-thirds in the artic and one-third in deepwater.

Deepwater and subsea: the future of energy production

As the conventional  “easy” reserves are exhausted, energy producers will need to push the limits of technology to gain access to resources in new and extreme locations, including distant offshore and deep sea resources, subsea production, and shale deposits; reserves that might have been seen as economically unviable a few years ago.

Modern technology has already had an impact on the accessibility of resources and there are three areas in particular that are receiving large amounts of investment to ensure we can meet future energy demand:

FLNG plants

FLNG plants are large floating vessels with the facilities to produce, liquefy, store and transfer liquefied natural gas at sea before being shipped directly to markets. The benefits of these plants are manifold. Firstly, natural gas is the cleanest-burning fossil fuel and is abundant and affordable. Having the ability to process gas at the point of extraction eliminates the need for long pipelines as well as the need to build onshore production facilities, both of which are not only costly, but also have a big impact on the environment.

FLNG production has only recently become viable. Historically, mechanically driven processes produced a lot of heat and emissions, suffered from reliability problems and were very large. Electrification, however, has had a dramatic impact on the economics of natural gas extraction. Modern e-houses, the electrical hearts of enormous floating production and storage offloading facilities (FPSOs), have reached a level of scale and efficiency that they can easily provide power for the thousands of people and heavy industrial processes that are required for gas processing and liquefaction at sea. The onboard electrical systems are also so resilient that they may only require maintenance every 4-5 years. Similar technology is used to power FLNG plants that are currently under construction around the world and will soon be sailing the seven seas.

Subsea extraction 

Sub-sea extraction involves moving to ever deeper waters and more challenging environments with more extreme temperatures. The deeper we go in future – and we are talking 3000 m below the water surface sea level and beyond – the higher the costs and risks involved in processing resources topside. However, subsea production brings many potential benefits – the added pressure delivered by a huge mass of water increases the proportion of extractable oil and gas by a substantial amount, and subsea processing realises substantial efficiencies, removing the need to pump waste oil and sand to the surface to be separated and processed.

A lot more research and development is needed, but early efforts are showing promising results.  For example, there is still work to be done in ‘marinising’ the technology – making it functional and durable in the corrosive and pressured conditions it will face. But advancements in electrical technology make this conceivable, and it is simply a matter of time and focussed research effort before we are able to realise true ‘subsea factories.’

Shale gas extraction

Shale gas extraction has seen unprecedented growth in recent years and significant investments are being made in research and development to support the industry. The combination of horizontal drilling and hydraulic fracturing has allowed access to large volumes of shale gas that were previously uneconomical and unsafe to extract. North America is leading the global shale gas revolution and accounted for around 90% of unconventional gas production in 2012. The US is preparing for major export activity to commence in the next few years and other resource-rich countries, including China, Latin America and Russia, are also set to accelerate production.

The rise in shale gas production has led to a substantial increase in demand for LNG facilities. A number of new facilities are starting to take advantage of electric motor driven compression technology in the processing, transport and distribution network of LNG as an alternative to traditional turbine devices. This process – called eLNG – provides a far more efficient, economical, reliable and stable supply chain. A typical electrical driving system can reach over 90% efficiency. Furthermore, electrical systems can enjoy uptime of up to 99.9% and typical architectures are able to run for up to five years without the need to stop for maintenance.

Electrification powers exploration

As we have seen from the discussion above, a key requirement for these oil and gas extraction techniques is electric power. In the case of FLNG plants, where space is at a premium and weight restrictions apply, electric drive motors are used to run the compression and cooling systems for liquefaction. In a deep-sea scenario, HVDC extends transmission range, allowing us to power electrical equipment installed on the seabed from land or FPSO based power supplies. The shale gas boom, on the other hand, has driven a need for more sophisticated and flexible LNG distribution networks.

The world’s power needs continue to grow at a substantial rate and our energy future remains a topic of significant debate. Unlocking the potential of these more challenging energy reserves is a core objective of the next decade of exploration, research and development, and electric technology has a key role to play.

Written by Giacomo Del Panta, GE Power Conversion.

Edited by Cecilia Rehn

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