Methanogenic bacteria have been found in coal beds here in the U.S. and companies are working to start natural gas production. For now the natural gas prices are forcing adverse market conditions on the firms, but the chance that some liquefied natural gas for export may be allowed could well spark more action.
San Diego biotech entrepreneur Jay Short has developed a novel technology to produce and capture methane or natural gas directly from porous coal, a process in the final stages of commercial testing in Wyoming by his newest company, Ciris Energy.
The methanogenic bacteria live in soft coal, something the world has a lot of, really an enormous amount, with China holding the largest reserve and the U.S. the second largest.
Short said, “Shale fracturing showed that the U.S. had potentially more hydrocarbon than anywhere else in the world, the latest estimates around 800 trillion cubic feet. If the Ciris process works, it could add another 1,000 trillion feet. That could be as big as shale fracturing.”
The Ciris proving grounds are on the legendary Powder River basin of northeastern Wyoming. The basin was once part of a vast inland sea where plants like algae, peat moss and others over time formed vast deposits of soft coal.
Coal is compressed plant material and the methane is essentially the waste material of microbes that long ago broke down the coal and plant material in a series of natural processes.
It was the revelation of Short’s team at Ciris to apply biotechnology to a process that for a century had been tackled mostly by engineers and physicists.
Short explains, “What this company is doing is not fracturing at all. Instead of taking mechanical probes and breaking up rock to release gas that is already there, what we do is introduce nutrients to the microbes and bacteria to tell them to start eating the coal, some of which exists in spore or dormant form. The microbes eat the coal, releasing the methane, and we capture it.”
Short notes that natural gas is biogenic. “It may have taken millions of years to make that gas, but the reason the process stopped, or took so long, is that the microbes didn’t have enough vitamins or nutrients. They didn’t have enough of the components they needed to continue to grow. We realized if we started feeding the microbes, we could get them to produce gas. Even though somebody may have come in and taken all of the gas out of the seam already, we can go back in and restart the process.”
The beauty of the Ciris process is the coal isn’t burned. No releases of particulate matter, no heavy metals like mercury and harmful chemicals such as sulfur and nitroxides. Much of the C02 that was produced in the process of converting the coal to natural gas by the microbes stays in the ground, and the rest is recycled.
The Ciris technology can be used two ways. An in-situ bioconversion process is injection of low concentrations of safe nutrients into buried coal seams in a controlled manner to rejuvenate, resume, and enhance gas production. This extends the life of coal bed methane fields with no environmental water displacement issues. Gas is collected from wells, dehydrated and sold, while water is recycled back through a continuous process that can be effective for decades.
The Ciris ex-situ coal biorefinery processing plant can be located near the point of natural gas usage. An ex-situ process combines traditional methods of manipulating low-rank coals that are typically mined, with proprietary bioconversion technologies. This method enhances conversion rates and gains high selectivity to specific products, including gas and chemicals. Coal is not burned and the process is fully contained.
Ciris’ investor partners include Conoco Phillips, General Electric, NRG and various venture capitalists. Ciris has raised approximately $50 million to date and is in the middle of another offering. In Wyoming, says Short, Ciris’ technology has shown it has the potential to increase the amount of natural gas some tenfold over the amount originally in the ground.
While natural gas prices are low the discipline to be productive and control costs is intense. Therein lies the basic opportunity. If the process can make money now, things can only get better.
Ciris isn’t alone working on the basic idea.
Luca Technologies has achieved a number of significant advances in its research and development effort, resulting in increased natural gas creation in the field.
Early testing demonstrated that methanogenesis from coal occurs in real-time. From 2004 to 2006, lab research led to the discovery of Luca’s initial nutrient formulations allowing experiments to transition from the lab to the field.
Field scale testing of these nutrient formulations between 2006 and 2008 resulted in an average increase in natural gas production of over 25 thousand cubic feet a day per restoration treatment. Luca continued to develop its nutrient formulations to increase bioconversion yield and rates of natural gas creation and production.
During 2009 and 2010, Luca achieved rapid advances in molecular analysis of methanogenic microorganisms, including DNA based tools for target identification, real-time monitoring and asset evaluation. In addition, Luca added DNA sequencing and Bioinformatics capabilities in its lab facilities, resulting in the creation of an extensive library of subsurface microbial DNA.
Luca has continuously refined its methodologies and criteria, and has developed an extensive skill set allowing it to reliably identify bioresource opportunities. To date, Luca has discovered methanogenic activity in 23 fields that it believes would be suitable for the application of its restoration process.
Now for the bad news.
Land managers at the U.S. Bureau of Land Management (BLM) have rejected an application by Luca to use bacteria to produce methane from northeast Wyoming coal beds. The problem is Luca refused to pay an additional $40,000 for the cost of processing its application, on top of $40,000 it paid previously.
Luca executives said they refused the additional payment because it appeared the BLM would never approve the permit. Company CEO Bob Cavnar accused the federal agency of favoring the coal mining industry, which has expressed concerns about methane farming.
The BLM counters the original amount had been exhausted and that the company has “to pay into the cost recovery account for the fees for permitting and they didn’t pay the account, so it was overdrawn.”
One wonders now, Back in May of 2012 the BLM told the company that it would require a well monitoring program that would cost up to $30 million, as reported by the Wyoming Gillette News-Record.
Its gotten quite heated; the BLM has threatened to prosecute Luca for trespassing if it continued to work.
Astute readers have noticed that the microbes and bacteria are going to need water for the hydrogen combined with the coal’s carbon. It’s going to take time to repopulate, get the water in and see the results. At this point the field trials are just getting underway.
It’s also worth noting that the adverse market condition is unique to North America. There is far more opportunity oversees. Ciris is seeing and acting on that and Luca is sure to follow. That could mean the technology will be much more mature when the North American market is ready.
Now if the government gets out of the way, low cost natural gas looks like a sure thing for a very long time. Keep in mind; people are higher than ten times more likely to die of the cold than of the heat. Low cost natural gas is a crucial economic factor.