House subcommittee examines focus of federal energy R&D support

Federal support of early-stage energy research and development in the 1980s and ‘90s led to technologies responsible for today’s US oil and gas renaissance, witnesses reminded a US House Science, Space, and Technology subcommittee. Alternative energy technologies deserve similar early-stage support now, Democrats on the Energy and Environment Subcommittee argued.

“I’m struck by the fairly dismissive arguments that alternative energy is unreliable and uncertain, and that fossil energy is a slam dunk,” said Brad Miller (D-NC), the subcommittee’s ranking minority member. Emerging technologies do not have fossil fuels’ “incumbent economic power” and consequently deserve early-stage federal funding support, he added.

But subcommittee chairman Andy Harris (R-Md.) said the Obama administration seems to condemn certain potential energy resources without considering ways to improve their extraction.

“This was clearly illustrated in May when [the US Department of Energy’s] assistant secretary for fossil energy testified to the subcommittee that oil shale was a component of the administration’s all-of-the-above energy strategy,” Harris said. “Yet when pressed, he acknowledged DOE was not spending any funding on oil shale R&D, and could not identify anything the administration was doing to actively advance oil shale.”

He said the Obama administration is similarly inconsistent toward shale gas production, which it has applauded, since the US Environmental Protection Agency and 13 other federal agencies and offices are trying to find new ways to regulate hydraulic fracturing.

Challenges remain

Despite initial breakthroughs, further unconventional oil and gas R&D is needed, witnesses told the subcommittee. “Unconventional resources are much larger in volume than are our conventional resource stores,” said Anthony Cugini, director of DOE’s National Energy Technology Laboratory. “These resources, however, generally exist in more geologically complex settings or in more remote or environmentally sensitive areas, and require more intensive production methods.”

He said DOE is carrying out research to quantify and understand shale oil and gas’s environmental and safety risks of shale gas and shale oil development, as well as improving the understanding of emerging and developing shale plays, lowering the cost and increasing the efficiency of technologies for treating fracing flowback water, and optimizing shale gas resource recovery. The efforts are funded through the ultradeepwater and unconventional gas and other petroleum resources program under the 2005 Energy Policy Act, Cugini said.

He noted that oil shale was a major public and private research topic in the 1980s, but interest declined as less expensive oil sources became available. “With regard to methane hydrates, the DOE has successfully finished a pilot production well,” Cugini said. “Because of this effort and past DOE efforts, hydrates have moved from a scientific curiosity in 2000 to a known resource today.”

Daniel Hill, interim head of Texas A&M University’s Petroleum Engineering Department, said shale production technology advances were significantly helped by modest DOE funding which supported research primarily at universities, small businesses, and the national laboratories.

“We know where the resources can be found, but we still need technical improvements to be able to produce much of the resource at prices that are beneficial to the public,” he told the subcommittee. “However, it will not be easy, and it will require two things—further developments in technology, and the trained engineers and geoscientists needed for continued growth.”

Educating engineers

DOE funding for oil and gas research potentially could make its greatest contribution by training more engineers and scientists at universities, according to Hill. “The demand for engineers in this field is huge—the [chief operating officer] of a major service company recently told me that his company alone hired 15,000 new employees in the US in 2011,” he said. “That is a lot of jobs, and many of them need to be highly trained engineers and scientists.

David Martineau, president of the Texas Independent Producers & Royalty Owners Association, said before the US realizes its full shale energy resource potential, it will need to understand subsurface property variations to avoid drilling marginal wells and increase recovery rates, scientifically characterize risks and inform stakeholders, and minimize unconventional operations' surface impacts.

“Recognizing the importance of oil and gas, and investing federal money in its development, should not be a thing of the past,” he maintained. “In fact, never in history has it been more crucial to continue improving and enhancing our ability to recover domestic oil and natural gas. Domestic energy independence can be achieved, and federal research money can play a part.”

Michael C. Hagood, program development director for Energy and Environment Science and Technology at the Idaho National Laboratory, said US oil shale resources also could begin to be produced in the next several years and last for most—if not all—of this century. The US Energy Information Administration estimated in 2009 that the soonest a commercial oil shale project could be initiated would be 2017 for one with a surface retort and 2023 for one using an underground, in-situ process, he indicated.

“[R&D] has already played a strategic role in the successful development of unconventional fossil energy resources, such as the Canadian oil sands and US shale gas and tight oil,” Hagood said. “All of these R&D programs took many years to bring new products to market. A summary profile of oil shale technology and R&D can be found in various DOE reports. Research emanating from Canadian oil sands development is also a valuable and relevant source of information, even though focused on a different type of hydrocarbon resource.”

Contact Nick Snow at nicks@pennwell.com.

Related Articles

Shell cuts $15 billion in spending for 2015-17

01/30/2015 Royal Dutch Shell PLC has curtailed more than $15 billion in potential spending over the next 3 years, but is not “not overreacting to current low ...

Victoria extends drilling, fracing ban

01/30/2015 The new Victorian Labor government of premier Daniel Andrews has extended the coal seam gas (CSG) exploration and hydraulic fracturing ban in the s...

Chevron’s $35 billion capital budget down 13% from last year

01/30/2015 Chevron Corp. will allocate $35 billion in its capital and exploratory investment program for 2015, including $4 billion of planned expenditures by...

US Senate passes bill approving Keystone XL pipeline project

01/30/2015 The US Senate has passed a bill approving construction of the proposed Keystone XL crude oil pipeline by a 62-36 vote after 3 weeks of debate. Nine...

Oxy cuts capital budget by a third

01/30/2015 In the midst of falling oil prices, Occidental Petroleum Corp., Houston, expects to reduce its total capital spending for 2015 to $5.8 billion from...

MARKET WATCH: NYMEX natural gas prices drop after storage report

01/30/2015 US natural gas closed at its lowest price in more than 2 years on the New York market Jan. 29 following the government’s weekly gas storage report,...

Pennsylvania governor reinstates state forest drilling moratorium

01/29/2015 Pennsylvania Gov. Tom Wolf (D) signed an executive order fully reinstating a 2010 moratorium on new oil and gas leases in state forests and parks. ...

PwC: Low oil prices might drive surge in restructuring in 2015

01/29/2015 Mergers and acquisitions (M&A) in the oil and gas industry hit 10-year highs in terms of deal value and volume in 2014, according to a report f...

DOE could meet 45-day LNG export decision deadline, Senate panel told

01/29/2015 The US Department of Energy would have no trouble meeting a 45-day deadline to reach a national interest determination for proposed LNG export faci...
White Papers

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by
Available Webcasts


OGJ's Midyear Forecast 2015

When Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Predictive Analytics in your digital oilfield - Optimize Production Yield and Reduce Operational Costs

When Tue, Jul 7, 2015

Putting predictive analytics to work in your oilfield can help you anticipate failures, plan and schedule work in advance, eliminate emergency work and catastrophic failures, and at the same time you can optimize working capital and improve resource utilization.  When you apply analytic capabilities to critical production assets it is possible to reduce non-productive time and increase your yield.

Learn how IBM's analytics capabilities can be applied to critical production assets with the goal of reducing non-productive time, increasing yield and reducing operations costs.

register:WEBCAST



On Demand

Cognitive Solutions for Upstream Oil and Gas

Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected