By BEN LEFEBVRE
ConocoPhillips Alaska/Associated Press
A ConocoPhillips drill rig at Prudhoe Bay on Alaska’s North Slope, seen in 2012, tested a method for extracting methane from methane hydrate.
Scientists in Japan and the U.S. say they are moving closer to tapping a new source of energy: methane hydrate, a crystalline form of natural gas found in Arctic permafrost and at the bottom of oceans.
At room temperature the crystal gives off intense heat, earning it the nickname of “fire in ice,” and making the estimated 700,000 trillion cubic feet of the substance scattered around the world a potentially major fuel source, containing more energy than all previously discovered oil and gas combined, according to researchers at the U.S. Geological Survey.
Scientists in Japan and the U.S. say they are moving closer to tapping a new source of energy: methane hydrate, a crystalline form of natural gas found in Arctic permafrost and at the bottom of oceans. Ben Lefebvre joins MoneyBeat. Photo: AP.
Commercial production of methane hydrate is expected to take at least a decade—if it comes at all. Different technologies to harvest the gas are being tested, but so far no single approach has been perfected, and it remains prohibitively expensive. But booming energy demand in Asia, which is spurring gigantic projects to liquefy natural gas in Australia, Canada and Africa, is also giving momentum to efforts to mine the frozen clumps of methane hydrate mixed deep in seafloor sediment.
The biggest concern is that the sediment that contains methane hydrate is inherently unstable, meaning a drilling accident could set off a landslide that sends massive amounts of methane—a potent greenhouse gas—bubbling up through the ocean and into the atmosphere.
Oil and gas companies establishing deep-water drilling rigs normally look at avoiding methane-hydrate clusters, said Richard Charter, senior member of environmental group the Ocean Foundation, who has long studied methane hydrates.
Critics See New Global-Warming Threat
Nevertheless, the government of Japan—where natural gas costs are currently $16 per million British thermal units, four times the level in the U.S.—has vowed to bring methane hydrate into the mainstream by 2023 after a successful drilling test in March.
In the government-sponsored test off of the southern coast of Japan’s main island, Honshu, a drilling rig bored nearly 2,000 feet below the seafloor.
Special equipment reduced the pressure around the methane hydrate crystals, dissolving them into gas and water, and then pumped about 4.2 million cubic feet of gas to the surface. While not a huge haul, it was enough to convince Japanese researchers that more natural gas could be harvested.
If Japan can deliver on its vow to produce natural gas economically from the methane hydrate deposits off its shores, it could experience a natural-gas boom that matches the fracking-fueled one under way in North America, said Surya Rajan, analyst at IHS CERA.
“If you look at what a dramatic shift the North American gas industry has gone through, could you afford to bet against something similar happening in methane hydrate?” Mr. Rajan said.
Successful development of methane hydrates could throw a wrench into liquefied-natural-gas megaprojects such as Australia’s $50 billion Gorgon development led by Chevron Corp., experts say.
“It would make me have pause about investing billions of dollars in an LNG export terminal,” said Christopher Knittel, an energy economics professor at the Massachusetts Institute of Technology in Cambridge.
Not all observers think that the costs can come down enough to make methane hydrate viable. But plenty of countries, particularly in Asia, are planning to try.
China plans to host an international conference on methane hydrate in 2014.
India is contemplating a push to develop the vast quantities of methane hydrate discovered off its coast in the Indian Ocean in 2006, according to the U.S. Geological Survey, a part of the U.S. Department of Interior that conducts scientific research.
In the U.S., scientists explored the northern Gulf of Mexico in May to map some of the 6.7 quadrillion cubic feet of methane-hydrate clusters believed to be underwater there. The Consortium for Ocean Leadership, a nonprofit group of researchers, is now trying to convince the Department of Energy to lend it a research drilling ship to do more tests.
“There are a huge amount of people internationally working in this area,” said Carolyn Ruppel, head of the gas hydrates project at the USGS. “A lot of national governments have gotten into the game.”
The most optimal places to harvest methane hydrate are near where the continental shelf transitions to the deep ocean, areas difficult to access from sea level.
Would-be producers also have to be careful when harvesting fragile clusters of methane hydrate to ensure nearby crystals don’t prematurely break and send greenhouse gases bubbling to the surface.
The cost of developing this new source of energy remains high, with estimates ranging from $30 to $60 per million British thermal units. In the U.S., natural gas currently trades for less than $4 per million BTUs, as the rise of fracking produced a gas glut.
But countries like Japan, Korea, India, and Taiwan import gas “at a high price and thus may find it economical to produce their own resources,” said George Hirasaki, a professor at Rice University in Houston who has done research on methane hydrates.
Last year, ConocoPhillips worked with the DOE on a test run producing natural gas from methane hydrate in Alaska’s North Slope, home to about 85 trillion cubic feet of technically recoverable methane hydrate, according to DOE statistics.
The company spent 13 days injecting carbon dioxide and nitrogen into methane-hydrate clusters in the permafrost. The chemical cocktail fractures the permafrost, allowing the gas to escape through the newly made fractures for collection.
ConocoPhillips was able “to safely extract a steady flow of natural gas,” a spokeswoman said.
ConocoPhillips declined to say how much it has invested in methane-hydrate production. The Houston-based company said that “at present, the technology does not exist to produce natural gas economically from hydrates.”
Write to Ben Lefebvre at email@example.com
A version of this article appeared July 29, 2013, on page B1 in the U.S. edition of The Wall Street Journal, with the headline: Fracking Dreams of a New Ice Age.