Professional Documents
Culture Documents
Presented at Bimasena International Energy and Mining Conference Jakarta Convention Center, 7 November 2007
Agenda
1 2 Introduction to CBM Ideal Business Process vs. Reality
3 4 5
Coal bed methane (CBM) is natural gas found in the coal seams of most coalfields. Methane (CH4) is contained within the coal seam where it is absorbed or attached to the coal Sometimes referred to as coal seam methane (CSM) or coal bed gas Although produced differently from traditional natural gas, CBM is sold and used the same as traditional natural gas 3
1 2
3 4 5
Phase II
- Further Desk Study - Field Activities: . Core Sampling . Lab Test . Eventually Pilot Test
Contractors commitment
2004 2005
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Legend:
First CBM production Government Participation Project Evaluation The beginning of Comercial Era CBM Production PP : Pilot Project PSC : Production Sharing Contract Investment and Production Projection
Source: Dr Ing Evita Legowo Gas, Power & Energy Alternative Conference, Feb 2007
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3 4 5
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Adsorption
Cleat system and other fractures Desorption, diffusion and Darcian flow Primarily water
Primarily gas
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Comparison Summary
Conventional Gas Nature: Large Reservoir Technical:
High pressure High gas rate
Business Characteristics: Wholesale Volume of reserve Direct extraction Gas supply flexible
Business Characteristics: Retail Volume repetitive Extracting trapped gas Gas supply not flexible
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Magnitude
Time
Source: Bruce Atkins, Focus, Gaffney, Cline & Associates Oct 2003
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Cost Structure
Overhead 10% Facilities 30% 60%
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Engineering:
Technology for Development Infrastructure and Gathering System Capability Expertise
Corporate Structure:
Capital Availability Senior Management/Investor Commitment Suitable Market Government Regulatory and Royalty Structure
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3 4 5
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Company
Anadarko EnCana Corp Arrow Energy Santos
Queensland:
Government requires electricity retailers to have 13% of their electricity generated by gas penalties for non-compliance of around 10/MWH
India:
CBM-III bidding round this year includes: WHAT WILL 7 years tax holiday from the date of production OFFER Fiscal stability ??? No participating interest of the Government Freedom to sell gas in the domestic market at market determined rate
GoI
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OPPORTUNITY
Blessed with natural resources Pioneer and main player in O&G for 40 years Investors excitement (domestic and foreign) Governments commitment
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Why Now?
Significant global and domestic need for renewable energy Declining oil production To support of governments energy policy changing from kerosene to gas Taking advantage of high oil price CBM euphoria for the last two years
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Investors Concerns
Little data on CBM potential Proliferation of newly licenced KPs in a potential CBM Work Area Lengthy process of proposal evaluation Decision making: central, local? Lack of CBM PSC model Risk of sharing facility
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Challenges Ahead
Win-win business propositions Environmental issues Coordination effort:
Central and local government O&G operator and CBM licence holder KP/CCoW and CBM licence holder
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Water
Gas
25000000 20000000 15000000 10000000 5000000 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
YEAR
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Thank You
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