Indonesia: Coalbed Methane Indicators and Basin Evaluation

Abstract

Abstract Indonesia has thick, low-rank coal deposits that are prospective for coalbedmethane (CBM) development but remain untested. Conventional oil and gas wellsthat drill through these coal seams experience gas kicks and blow outs, goodCBM indicators. We analyzed petroleum and coal mining data to perform acomprehensive assessment of Indonesia's CBM resources. We identified 12.7trillion m3 (450 Tcf) of prospective CBM resources within eleven onshore coalbasins. Full-cycle development costs in high-graded areas are estimated at$0.70/Mcf. These potential CBM reservoirs could be tested at low cost usingcoreholes or production "wells of opportunity." Introduction Coalbed methane (CBM), which is methane desorbed and produced from deep coalseams, has become a significant source of natural gas supply in the USA. Fromhumble beginnings in the 1980's, CBM production has steadily grown to thecurrent 127 million m3/day (4.5 Bcfd), nearly 10% of total USAnatural gas production. CBM reserves at the end of 2002 stood at 18.5 Tcf.Cumulative reserve additions, including past production, total nearly 30 Tcf.Much of this reserve is low-cost natural gas with all-in supply costs of under$1.00/Mcf. Outside the USA, CBM is undergoing initial commercial development inAustralia and Canada, while exploration is underway in China, India, SouthAfrica and several other coal-rich countries. Indonesia has extensive coal deposits distributed in eleven onshore coalbasins (Figure 1), yet has not yet experienced significant CBM testing [1].There has been a perception by CBM operators that Indonesia's coal deposits aretoo shallow and too low rank to be prospective. After all, Indonesia's coalmining sector produces primarily lignite or sub-bituminous coal from open-pitmines that have no significant methane control issues. However, this perception is changing due to several factors:The successof low-rank CBM development in the Powder River Basin, Wyoming, USA, where gasproduction is more than 28 million m3/day (1.0 Bcfd) and increasingrapidly;improved understanding that the shallow coal seams mined at thesurface in Indonesia dip basinward and become gas charged at CBM target depths(100–1,500 m) over broad areas; andstrong and nearly ubiquitous gas kicksthat are recorded on petroleum well mud logs as these deep coal seams arepenetrated, sometimes causing hole stability problems, and indicating that thecoals have adsorbed large quantities of methane. This study was supported by the Asian Development Bank and Indonesia'sDepartment of Energy and Mineral Resources (MIGAS). It builds on earlier datacompilation efforts supported by PT Caltex Pacific Indonesia and Pertamina[2,3] and laboratory work performed by the Indonesian Ministry of Energy andMineral Resources [4]. A separate component of the project, not discussed here, involved assisting MIGAS in formulating regulations for commercial CBMinvestment and development. Data Control Extensive surface and subsurface data are available in Indonesia for basicCBM parameters such as coal thickness, depth, rank and other coal properties.We assembled a GIS data base of these coal properties acquired from coalexploration coreholes, deep petroleum exploration well logs, measured coaloutcrop sections, and laboratory data such as vitrinite reflectance andvolatile matter analyses. Recently, adsorption isotherms have been run on ahandful of coal samples, which remain confidential. Other data on CBM-specificreservoir properties remain scarce or non-existent. Coal seam permeability hasnot yet been tested in situ using well testing. No CBM production wells havebeen tested to date, nor has hydraulic fracturing of coal seams been attempted.Despite this paucity of data, it is still possible to make rough estimates ofin-place CBM resource distribution and potential producibility. Basincharacteristics are summarized in Table 1.