Enhanced oil recovery promises another revolution equal to that of shale fracking

Samuel Thernstrom:

Just five years ago, almost no one outside the natural gas industry had heard of fracking, even though the basic technologies were not new; today, the shale gas revolution has transformed America’s energy markets, with profound effects for economic growth, competitiveness, security, and environmental quality. In a nation still deeply concerned about its energy future, this extraordinary success story should prompt the question: Can we do it again?

The answer is yes​—​if we correctly understand both the model for innovation that shale gas exemplifies and an opportunity that now exists to emulate the shale model. That opportunity involves exploiting a technique called “enhanced oil recovery” (EOR).

Like fracking on the eve of its success, this concept is virtually unknown to most Americans, yet it rests not on pie-in-the-sky technological dreams but on the application and refinement of proven technologies that companies have been developing for decades. Like fracking, enhanced oil recovery has the potential to recover staggering quantities of hydrocarbons that were previously known but considered inaccessible. As with fracking, the primary players will be the private sector​—​but public policy has a crucial role to play in establishing the necessary conditions and providing the impetus for this market to take off. Most tantalizingly, enhanced oil recovery should be less controversial than fracking, because it also offers the opportunity to radically reduce greenhouse gas emissions from electric power generation (and other industries).
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In fact, the opportunity that enhanced oil recovery offers today is much clearer than that of shale gas in 1976, when President Ford first focused federal attention on its potential. EOR’s core technologies work well, and the market is much more advanced than shale gas was in the 1970s. But a focused public push to expand the market for EOR and bring next-generation technologies forward could still have profound effects on America’s energy future.

Using known and next-generation technologies and processes, enhanced oil recovery could increase domestic oil production​—​mostly from existing wells, not new fields​—​by tens of billions of barrels. Public policies to jump-start this nascent market could significantly enhance our energy security, improve our balance of trade, and generate tens of billions of dollars in revenue for the federal government and trillions in economic activity over the next half-century.

Equally important is the answer offered by EOR to two of the most pressing questions in energy policy: What is the future of coal in this country, and what can the federal government do to reduce the risks of climate change? The answer EOR offers is uniquely compelling: Coal stays in our energy mix while almost all of its carbon gets trapped underground.

The key to this opportunity lies in the fact that carbon dioxide is the essential ingredient in enhanced oil recovery operations. And in contrast to EPA’s divisive, expensive, and likely ineffective approach to regulating carbon emissions, EOR would give American companies an opportunity to make money putting carbon dioxide underground while producing oil, making this a wealthier, more productive country with a stronger, more secure energy economy and a cleaner environment.

Drillers have long understood that they leave most of their product in the ground. As oil is pumped, the pressure underground drops and it becomes harder to extract what remains. Typically, only about one-third of the oil in a given location can be economically removed. As a result, many supposedly “depleted” wells actually still contain most of their oil​—​just waiting for a technology that will make it economical to extract it.

In the early 1970s, drillers in west Texas figured out how to do just that, and the remarkable secret to their success was carbon dioxide. Pumping carbon dioxide into depleted wells not only increases the pressure, it also acts as a solvent, helping to separate oil from the cavities in the rock where it is trapped and the water it is often mixed with. This process enables oil companies to extract as much as another third of a site’s oil​—​essentially doubling a well’s productivity.
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There is much more.

This increased efficiency will give producers another way to deal with the reduced price of oil and put even more pressure on OPEC.  Increasing the efficiency of oil production through the use of CO2 injections into wells looks like a win win deal for everyone but the anti energy left and inefficient alternatives.