EXPLORATION FOR COALBED METHANE STARTS UP IN NORTHWESTERN NOVA SCOTIA

Bruce J. Sakashita
Resource Enterprises Inc.
Salt Lake City

A consortium of three Canadian companies and a U.S. firm, Resources Enterprises Inc. (REI), Salt Lake City, has been awarded the rights for coalbed methane gas exploration on 250,000 acres in the Cumberland basin of Nova Scotia, Canada.

The license agreement requires that geological and engineering studies be performed during 1993 to select exploratory well locations. Three slimhole wells must be drilled by yearend 1994, and three production test wells must be completed by yearend 1995.

The Natural Resources Ministry accepted the application by REI and its Nova Scotia partners Logan Drilling Ltd., Victoria Mining Services, and G.P. Isenor Co. Ltd.

Natural Resources Minister John Leefe said he is "very pleased to see a company with REI's expertise join with Nova Scotia interests to pursue such a promising and clean burning alternate source of energy. While it is too early to say if this project will lead to commercial production, I am optimistic based upon coalbed methane developments in the U.S. and Nova Scotia's Particular circumstances."

EXPLORATION LICENSE

The Cumberland basin exploration license lies in northwestern Nova Scotia (Fig. 1).1 2

The presence of Carboniferous coal measures in the license area has been definitively confirmed using seismic and drillhole data (Figs. 2, 3).1

The Nova Scotia Department of Natural Resources reports that the Cumberland basin contains 75 to 95 gassy, high volatile A and medium volatile bituminous coal seams that range in individual thicknesses of as much as 14 ft.

Fifteen individual seams are typically at least 3 ft thick each.3 Cumberland basin coals are similar in age and characteristics as the Carboniferous coals in the Black Warrior coal basin of Alabama in the U.S., where widespread commercial coal natural gas production has been established.

A gas resource of about 6 tcf, or 15 bcf/sq mile in the license area, is estimated using the equation G = 1359.7 Ahgp in which G is gas in place resources in trillion cubic feet, A is area in acres, h is average net coal thickness in feet, g is average in situ gas content in standard cubic feet per ton, and p is average coal density in grams per cubic centimeter.4

A total of 40 ft of net coal, an in situ gas content of 300 scf/ton, and a coal density of 1.5 g/cc were assumed in this calculation.

MARKET OUTLETS

Economic growth and Nova Scotia's ability to attract new industries have been limited in part by high fuel costs.

Liquid and propane fuel costs currently range from $3.17 (Canadian)/MMBTU to $16.56/MMBTU.

Energy consumers in industrial centers in Nova Scotia, including Halifax/Dartmouth, New Glasgow, Amherst, Port Hawkesbury, and Truro currently burn fuel oil, diesel, and propane and will be targeted as likely candidates for fuel switching to natural gas. Additional markets include conversion of fleet vehicles from gasoline and diesel fuel to natural gas.

Natural gas produced from coal seams is an environmentally responsible and reliable fossil fuel. This resource could play a key role in the future economic growth of Nova Scotia while maintaining environmental compliance with residents of the province.

GEOTHERMAL POTENTIAL

A unique possibility associated with the Cumberland basin license is that coalbed methane dewatering operations could merit combination with geothermal energy.

Geothermal water is currently pumped from abandoned coal mines in the city of Springhill in the eastern part of the license area and used as an energy source.

Similarly water from coalbeds may represent an added geothermal energy resource that can be used for the mutual benefit of all parties.

REFERENCES

Calder, J.H., Controls on Westphalian Peat Accumulation: The Springhill Coalfield, Nova Scotia, PhD thesis, Dalhousie University, N.S., 1991.
Donohoe, H.V. Jr., and Grantham, R.G., Geological Highway Map of Nova Scotia, Atlantic Geoscience Society, Special Publication No. 1, Nova Scotia, 1989.
Calder, J.H., Coal in Nova Scotia, Nova Scotia Department of Mines & Energy publication, Halifax, N.S., 1985.
Mavor, M.J., Close, J.C., and McBane, R.A., Formation Evaluation of Exploration Coalbed Methane Wells, paper CIM/SPE 90-101 presented at the international technical meeting jointly hosted by the Petroleum Society of CIM and the Society of Petroleum Engineers, Calgary, Alta., June 10-13, 1990.