A U.S. Department of Energy (DOE) project is turning “free fuel” (gas extracted as a byproduct of oil production) from marginal and low-production oil wells into fuel for onsite electric power. This practice lowers costs, eliminates flaring, reduces the number of shut-in wells and does not damage the environment.

The DOE Office of Fossil Energy’s National Energy Technology Laboratory (NETL) funded the oilfield flare-gas electricity systems (Offgases) project to allow researchers to evaluate the use of microturbines to consume stranded gas and generate low-cost electricity—which, says DOE, costs some 60% to 80% less than using utility-grid power.

Offgases is encouraging oil production in fields where it was previously too costly. The goal is to add 75,000 barrels of daily domestic oil production over 10 years by preventing premature plugging and abandonment. This could potentially boost domestic oil production by some 28 million barrels per year within 10 years of its inception, according to DOE.

On the one hand, if operators find stranded gas, defined as gas that does not qualify for transportation through commercial pipelines, they may abandon wells early or flare gas. On the other hand, oil-production sites use a lot of electricity. For example, according to the California Oil Producers Electric Cooperative, electricity accounts for 40% to 60% of the operating cost of oil production and delivery in that state, and it represents one of the highest expenses in producing oil from marginal wells. The cost of energy figures heavily in the decision to produce or abandon a declining field.

Onsite microturbines create burn the associated gas and generate needed power. Capacity of these microturbines range from 30 to 350 kilowatts, and can be modular, allowing for the correct matching of gas source to the power equipment required. A microturbine can be installed individually or multi-packed to power applications up to 1.5 megawatts or more. Power can be produced parallel with, or independent from, the utility grid. Microturbines can use gas with an H2S content as high as 7%, are low maintenance and have clean exhaust.

The Offgases project included several sites with associated gas of various heat-content values and quality, including using high-Btu gas, medium-Btu gas, and harshly contaminated fuel gas.

The high-Btu gas project involved stranded gas containing more than 1,600 Btu. An oil field had been shut in for eight years because the operator had no means of handling associated gas. Researchers chose a Capstone 30-kW microturbine coupled with a horizontal scrubber to remove produced water and a small compressor to achieve the line pressure needed for the turbine. After the wells were reworked, production increased to 23 barrels per day. Production was estimated at about 9,000 cubic feet per day of 1,650-Btu gas.

A second application of the new technology took place in a well producing me­dium-Btu gas that did not meet the quality requirements for commercial pipelines in California. Three Capstone 30-kW microturbines were installed onsite to generate power, and a large compressor was added to achieve the pressure needed for the microturbines.

The solution also included a vertical scrubber to remove associated liquids and a small refrigeration dryer. The 19-well field, which had been at risk of abandonment, is now producing 150 barrels of oil per day, according to the DOE.

The third field in the demonstration contained harsh gas—gas that contains high levels of nitrogen, carbon dioxide and H2S. The unusable gas used to be flared, but now enough H2S is scrubbed from the gas to bring air emissions into compliance, using a patented sulfur-treating system.

The project included the installation of an IR 70-kW microturbine to generate electricity through an interconnect permit with Pacific Gas & Electric. The system produces two segregated streams of gas, one containing about 6,000 parts per million H2S and the other containing no H2S. The separate streams allow researchers to test various concentrations of H2S.

At year-end 2007, researchers still were in the maintenance and monitoring phase of the project, collecting runtime and equipment reliability data along with operating maintenance figures.

The participants in the Offgases program are developing a system for comprehensive technology transfer. They expect to target a broad audience interested in distributed generation, oil and gas production, and utility regulations, the DOE reports.