Key Factors Differentiate the Success Rate of Coalbed Methane Pilots Outside of North America - Some Australian Experiences

Abstract

Coalbed methane (CBM) has been considered a relatively mature unconventional gas resource in North America. In Australia, where the CBM or coal seam gas (CSG) industry is nearly two decades old, there have been successful and unsuccessful pilot projects and resources have been slower to develop after nearly twenty-five years since North American technologies were exported internationally. Thus, it is reasonable to believe that there are differences outside North America that have hindered CBM development in Australia. Often CBM pilots owe their degree of success to one of three major factors: geologic or structural setting, reservoir properties, or completion strategies. Most pilot testing have been conducted either to characterize the production from a particular geo-domain associated with certain perceived geological risk and uncertainty or to estimate potential project reserves to a reasonable degree of accuracy. This need to reduce uncertainty is more pronounced in Australia based on the need to balance development decisions, tenure retention requirements, whilst minimising the risk for the upcoming development phase. Often in hindsight, the opportunity to increase the chance of success for good areas or reduce the expenditures in poor areas was achievable through improved reservoir characterisation or better pilot planning. In some cases, the resource volumes are large, but the progression of resources to reserves has been less certainty based on challenges. In this paper we will highlight some key observations from several Australian CSG pilots that led to success or challenges for each case. The authors' goals are to identify key indicators, which if recognised earlier may have increased the rate of success or reduced unnecessary expenditures in these pilot areas.