Unconventional Resources Program
The mission of the Unconventional Resources Program is to increase the supply of domestic natural gas and other petroleum resources through reducing the cost and increasing the efficiency of exploration for and production of such resources, while improving safety and minimizing environmental impact.
“Unconventional natural gas and other petroleum resource” is defined in the 2005 Energy Policy Act (EPAct) as natural gas and other petroleum resource located onshore in an economically inaccessible geological formation, including the resources of small producers.
Resource Opportunities and Priorities
Unconventional natural gas resources are best described as those gas accumulations that are hard to characterize and commercially produce by common exploration and production technologies. These resources are typically located in heterogeneous, extremely complex, and often poorly understood geologic systems, often easy to find but difficult to produce. For example, while it is not difficult to find large lenticular sand packages in many basins, it is very difficult to determine their flow properties from petrophysical well surveys and to design effective completion procedures. Furthermore, because of their very low permeability, establishing gas flow at a reasonable commercial rate requires costly production stimulation operations. These types of considerations are responsible for the high risk factors and unpredictable results often associated with unconventional gas exploration and development projects that inhibit industry investment in these resources.
Due to their potential significance and in view of the limited resources available to the research program, gas shales and tight gas sands have been the primary focus of the program to date. As interest and challenges in shale oil development have evolved, the program has been expanded to include those issues. Novel technologies for coalbed methane development are also included, but at a secondary level.
Exploration and production activity over the past several years has revealed that shale formations, in particular, hold the potential to yield significant volumes of natural gas and oil that were notpreviously thought to be economically productive. Shale formations are characterized by low matrix permeability, and production from shale requires high volume hydraulic fracture treatments, which add cost and risk to the well completion operation.
The development of shale plays, particularly in populated areas without a history of oil and gas development, has led to public concerns regarding the hydraulic fracturing processes necessary to produce these resources. Thus, in addition to developing the technologies necessary to economically produce unconventional gas resources, the program includes specific efforts to more fully define the risks associated with unconventional oil and gas development and ensure that appropriate technologies are available to mitigate those risks. Issues concerning water usage, methane emissions and overall land footprint are also addressed within the program.
The overarching objectives of the Unconventional Resources Program are:
- Increase Production and Recovery in an Environmentally Sound Manner: Develop tools, techniques and methods that substantially increase, in an environmentally sound manner, commercial production and ultimate recovery from established unconventional oil and gas formations and accelerate development of existing and emerging unconventional plays.
- Reduce Environmental Impact: Develop tools, techniques and methods that substantially decrease the environmental impact of unconventional oil and gas development, with particular emphasis on water management,operations footprint and methane emissions
- Encourage Demonstrations of New Technology: Integrate the results and deliverables of the existing portfolio of projects to encourage industry to demonstrate and apply new technologies to enhance safe and environmentally responsible production of the domestic unconventional gas resource base. Successful technology transfer is an important component of this objective.
- Develop Technologies to Enable Environmentally Responsible Development of Emerging Oil and Gas
Plays: Develop techniques and methods for exploration and production from high priority emerging oil and gas shales, coal and tight sand fields, as well as frontier basins and formations, where these operations have been hindered by technical, economic or environmental challenges.
An important aspect of the Unconventional Resources Program is encouragement of teaming efforts to develop integrated production technologies for unconventional gas resources. To the extent possible, integration of geologic concepts with engineering principles to overcome production and environmental issues is encouraged. The intent is to develop a coordinated program, as opposed to individual projects, such that the whole has much greater value than the sum of the parts.
Each year’s activities within the Unconventional Resources Program are based on an Annual Plan that is approved by the Department of Energy (DOE). The draft Annual Plans submitted by RPSEA in past years, as well as the plans ultimately approved by DOE, are available here [link].
Proposals submitted for the Unconventional Resources Program are divided into topic areas (e.g. Completion, Reservoir Engineering, Resource Assessment, etc.) for review, in order to align the technical expertise and experience of reviewers with the content of the proposals. Three or more reviewers provide technical evaluations of the proposals within each topic area. To the greatest extent possible, all of the proposals within a topic area are evaluated by the same set of reviewers. The Unconventional Resources Program Advisory Committee (PAC) selects proposals for funding based on the technical review scores and the priorities associated with the various topic areas and targeted resources. Prior to considering individual proposals, the PAC assigns priorities to each of the topic areas for each of the targeted resources. The highest priority resource/topic area combinations are given the most weight in project selection, although all proposals with competitive technical review scores are considered for funding. The PAC considers factors such as balance among the time scales associated with technology and resource development, diversity of technical approach and the geographic distribution of targeted resources when developing a portfolio of projects intended to maximize the probability of meeting program goals. The specific criteria used for the evaluation of proposals is included in each solicitation issued by RPSEA.