U.K. boosts coalbed methane exploration

• U.K. coalbed methane license awards [163,131 bytes]

John Battle, science, industry, and energy minister, told the parliament he had awarded 33 onshore licenses covering 120 blocks to 27 companies under the U.K.'s eighth landward licensing round, opened March 1997 (see table).

"The round," said Battle, "has particularly attracted strong interest from companies targeting the U.K.'s gas reserves, including conventional natural gas and coal-related methane resources."

Battle said the government is keen to see recovery of methane gas from abandoned mines and from potentially recoverable sources where gas extraction can improve safety.

DTI recently approved a coalbed methane development by Coalbed Methane Ltd. (CBM), Falkirk, Scotland, which already has Britain's first coalbed methane development under way.

Licensing change

The minister expects to make an announcement at a later date on the seven remaining applications, which still have issues unresolved: "I have decided not to keep other applicants waiting."

Battle said that DTI intends to propose a new form of onshore license to encourage development of coalbed gas resources.

"I am concerned," said Battle, "that interest by companies in coalbed methane has been hindered by the present licensing system, which was designed to manage conventional oil and gas exploration.

"So I have asked my officials to open consultation later this year on proposals for a new form of onshore license designed to encourage the exploitation of both conventional coalbed methane and other forms of coal-related gas.

"There would be environmental benefits from using the considerable quantities of gas from abandoned coal workings, which escapes to the atmosphere, where it is 17 times more potent as a greenhouse gas than the exhaust from burning it would be.

"Although unsuitable as a feed to the national gas grid, this gas can be burned locally to generate electricity or to lower industrial process costs and is a resource that the government is keen to see used."

Developments

Airth field is being developed with four wells tied back to a gathering station and generating plant, with first commercial operation slated for April.

Martyn Bacon, CBM's development manager, told OGJ that work on the license started 4 years ago. Drilling of the first three wells revealed problems in interpretation of seismic data originally acquired by British Coal Corp.

"We acquired inverse-velocity seismic data from the wells to help in drilling a fourth well," said Bacon. "This was the key to making this project viable."

Airth has estimated reserves of more than 15 bcf of gas, proved with the existing wells. Bacon said two further wells are planned here to gain access to further reserves.

At Airth, CBM is installing three 1-MW capacity electricity generating units, and aims to have full capacity installed by yearend.

The power generated will be fed into the local electricity transmission grid. Field life is expected to be more than 20 years.

At Arns Farm, first commercial operation is expected in early 1999. Here, CBM drilled four wells based on reinterpreted seismic data acquired by former state-owned monopoly British Coal.

Arns Farm development will comprise four wells tied back to a gathering station and 4-MW generating plant. This field has estimated reserves of 8 bcf of gas and is also expected to be operational for 20 years.

CBM was awarded two new licenses by DTI under the eighth round. Bacon said CBM intends to drill a well on one of these license areas this year.

The company also acquired the EXL 266 license area near Fife, Scotland, under the U.K.'s sixth onshore licensing round. Here, CBM is going through the planning application process for one exploration well.

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