Production modeling and economic evaluation of a potential gas hydrate pilot production program on the North Slope of Alaska

Thesis (M.S.) University of Alaska Fairbanks, 2004Methane hydrates consist of a water ice lattice with methane gas molecules contained in the lattice cavities. When dissociated into its constituent water and methane, one volume of hydrate contains approximately 138 volumes of methane gas. On the North Slope area of Alaska, it is estimated that accumulations containing between 300 and 5000 trillion cubic feet of gas. The feasibility of a pilot production project was computed to determine the production potential of the hydrate accumulation and its economic return. The production of gas from a 1 mile by 4 mile reservoir block containing hydrate underlain by an accumulation of free gas was simulated and the resulting production profile inputted into an economic model. As the mechanism for the production of hydrates differs from conventional hydrocarbons, an existing thermal hydrocarbon computer simulation program was adapted. Results of the simulations indicate that depressurization of the free gas zone reduces the pressure at the gas-hydrate interface below that necessary for hydrate stability and causes the hydrate to dissociate into methane gas and water. Analysis found that, in most situations, a development project would be profitable, though the results are highly leveraged to the transportation cost and gas sales price.1. Introduction -- 2. Literature review -- 2.1. The nature of hydrate accumulations in the field -- 2.2. A brief history of gas hydrate study -- 2.3. Formation and extent of gas hydrates -- 2.4. Production of hydrates using conventional technology -- 2.5. Existing hydrate dissociation models -- 3. Mathematical models for hydrate dissociation -- 3.1. Hydrate decomposition kinetics -- 3.2. Flow equations -- 3.3. Permeabilities -- 3.4. Energy balance equation -- 3.5. STARS thermal composition simulator -- 3.6. Governing equations used in the STARS model -- 3.6.1. Conservation equations -- 3.6.2. Flow terms -- 3.6.3. Chemical reaction, interface mass transfer source/sink terms -- 3.6.4. Heat loss source/sink terms --3.6.5. Phase equilibrium relationships -- 3.7. Development of STARS for use with hydrate dissociation simulations -- 3.7.1. Dissociation reaction -- 3.7.2. Relative permeabilities -- 4. Simulation experiments -- 4.1. Location of a potential pilot project -- 4.2. Characterization of the reservoir -- 4.2.1. Production scenario -- 4.3. Construction of the modeling grid and initialization of the simulator -- 4.3.1. Reservoir grid -- 4.3.2. Temperature and pressure -- 4.3.3. Thermal properties -- 4.3.4. Production wells -- 4.3.5. Model symmetry and simplification -- 4.3.6. Stock tank volumes initially in place -- 4.4. Reservoir modeling runs -- 4.5. Economic modeling -- 4.6. Initialization of the Economic model -- 5. Results -- 6. Conclusion and recommendations for further work -- 7. References