Coal seam gas could supply 5-10% of NZ’s gas needs

Resource Development Technology is a partner with Solid Energy in Coal Bed Methane Ltd which has been flowing 98.4% methane, similar to natural gas content, in tests from deep appraisal wells on the Huntly coal field 10 km west of Huntly.

Mr Stepanek said drilling costs and gas prices would drive development of coal seam gas resources in New Zealand.

He said coal resources in the Huntly area are quite well known because of earlier drilling surveys so the partners were working on developing methods for stimulating gas flow and finding out development costs.

Fracture stimulation of the coal bed was necessary to make commercially viable amounts of coal seam gas flow from the deep coalbed.  A milkshake of fluid and sand was pumped at high pressure down the well to fracture the coalbed in a radius of up to 500 feet from the hole.

Once water was pumped from the coal seam some of the appraisal wells had flowed at 70 mcf of gas a day from the Renown seam.

Mr Stepanek said he believed there was a potential to produce two to three times more gas from each well.

Surplus water extracted from the seam to allow the coal seam gas to flow was being pumped into the lower Kupakupa seam.  This seam could be developed later from the same wells.

There was up to 30 metres of coal seams down to 500 metres below ground in the area being developed Mr Stepanek said.

Wal Muir an Australian coal seam gas consultant, said that coals are not very permeable and easily damaged.  “Treat them with care,” he said.

“Flow rates are going to be low and initial capital costs high, so keep costs low by thinking and planning your approach carefully,” Mr Muir said.

Steve Stepanek's presentation on Coal Seam Methane at Huntly can be viewed here [3.8 MB PDF].