Current status, industrial development opportunities and prospects of coalbed methane development and utilization in my country

Feng Sanli

(China United Coalbed Methane Co., Ltd. Beijing 100011)

About the author: Feng Sanli, born in 1956, male, senior engineer, currently serving as China United Coalbed Methane Co., Ltd. Deputy General Manager of Gas Co., Ltd., address: No. 88 A, Anyai Street, Beijing, Postal Code: 100011.

Abstract article introduces the current situation of coalbed methane development and utilization in my country from the aspects of coalbed methane resources, technology and policies, clarifies the problems existing in the exploration and development of coalbed methane in my country, and analyzes in detail the current promotion of the rapid development of coalbed methane in my country opportunities, and finally gave an objective outlook on the prospects of coalbed methane development and utilization in my country.

Keywords Coalbed Methane Current Opportunities and Prospects

Status, OPPortunities and DeveloPment ProsPects of China's CBM Industry

Feng Sanli

（China United Coalbed Methane CorP.Ltd., Beijing 100011)

Abstract: The article introduced the status of development and utilization of China's CBM from CBM resources, technology and some policies respectively. Some issues of exploration and development of CBMwere also listed in this article. Based on the analysis on the various opportunities that China's CBM industry is faced with under new policy environment of China, the author finally looked into the future prospects of CBM development and utilization in China.

Keywords ：CBM; status; opportunities; prospects

Coalbed methane, commonly known as coal mine gas, is a new type of energy that has emerged in the world in the past one or two decades. It is an unconventional energy that exists in coal seams in an adsorbed state. The composition of natural gas is basically the same as that of conventional natural gas. The methane content is greater than 90% and the calorific value is greater than 8000kcal/m3. It can be used as a high-quality energy and chemical raw material of the same quality as conventional natural gas. At the same time, coalbed methane is a harmful gas in coal mine production, posing a huge threat to coal mine production safety. With the mining of coal mines, a large amount of coalbed methane is discharged into the atmosphere and causes serious pollution to the environment. It is second only to carbon dioxide. main source of greenhouse gases. Therefore, the development and utilization of coalbed methane, a clean energy, is of great practical significance for optimizing my country's energy structure, reducing greenhouse gas emissions, mitigating air pollution, solving coal mine production safety, and achieving sustainable development of my country's national economy.

The United States is the first country to successfully commercialize coalbed methane. Its annual output reached 500×108m3 in 2004, which is more than my country’s annual natural gas output in the same year. Canada's coalbed methane industry has developed rapidly in recent years, from 1×108m3 in 2003 to more than 30×108m3 in 2005. In addition, coalbed methane in Australia and India has also developed rapidly in recent years.

1 Current status of coalbed methane development and utilization in my country

1.1 Coalbed methane resources/reserves status

my country is the largest coal producer in the world, with huge coal resources. At the same time, my country's coalbed methane resources are also very rich. In 2000, the "National Coalbed Methane Resource Evaluation Report", a first-class project of the State Planning Commission undertaken by China United Coalbed Methane Co., Ltd., predicted that in my country's onshore bituminous coal and anthracite coalfields, at burial depths The amount of coalbed methane resources within the range of 300 to 2000m is 31.46×1012m3, which is equivalent to my country’s onshore natural gas resources and ranks third in the world, as shown in Table 1.

Table 1 Coalbed methane resources in the world's major coal-producing countries (burial depth less than 2000m)

* "National Coalbed Methane Resource Evaluation Report", China United Coalbed Methane Co., Ltd., 2000 year

As of now, my country has proven coalbed methane geological reserves of 1023.08×108m3, of which 754.44×108m3 is mainly proven by surface development, and 268.64×108m3 is mainly proven by mine drainage. See table 2.

Table 2 List of proven geological reserves of coalbed methane in my country

1.2 Current status of exploration and development technology

After the "Sixth Five-Year Plan" to the "Ninth Five-Year Plan", especially the " Through the implementation of the "Tenth Five-Year Plan" national science and technology projects, and by learning from foreign successful experiences in coalbed methane exploration and development, combined with the geological characteristics of my country's coalfields, my country's coalbed methane has made great progress from selection evaluation to exploration and development technology, forming a series of independent knowledge We have a property-right coalbed methane exploration and development technology system and have basically mastered the conventional technologies for coalbed methane exploration and development. These technologies mainly include:

——Evaluation technology of areas favorable for coalbed methane development

——Rope coring technology

——Clear water drilling technology

——Hydraulic sand-carrying fracturing technology

——Clean fracturing fluid sand-carrying fracturing technology

——Nitrogen foam fracturing technology

——Underbalanced drilling and completion technology

——Multi-branch horizontal well drilling and drainage technology

——Underground directional multi-branch long borehole drainage technology in coal mines

1.3 Surface development of coalbed methane

After more than ten years of practice, my country's coalbed methane surface exploration and development has made major breakthroughs. Among them, the representative projects that realize small-scale commercial coalbed methane surface development are as follows:

(1) Shanxi Qinshui Zaoyuan Well Formation Coalbed Methane Development Pilot Project: The Zaoyuan Well Formation started in April 2003 Supply air to the outside. The well group has 15 production test wells, a small CNG compression station with a daily compression capacity of 3.6×104m3, and a small coal-bed methane power station with a daily power generation of 400 kW, realizing the commercial development, gathering and transportation of small-scale coal-bed methane , storage, transportation and utilization.

(2) Coalbed methane development project in the Liujiajing Formation in Fuxin, Liaoning: The Fuxin project drilled 8 wells in the Liujiajing Field in Fuxin from 1999 to 2001, forming a small well network. The average gas production of a single well is more than 3000m3/d.

(3) Panzhuang coalbed methane surface development project in Jincheng, Shanxi: In 1992, 7 coalbed methane production test wells were constructed in the Panzhuang area of ??Qinshui, Shanxi, with good drainage effects. From 2004 to 2005, 150 coalbed methane wells were constructed in the Panzhuang mine field, and 70 wells were fracturing and drained. The daily coalbed methane production was about 10×104m3. The project has built a complete gathering and transportation pipeline network, gas gathering station and compression station.

(4) Shanxi Qinnan Coalbed Methane Development and Utilization High-tech Industrialization Demonstration Project - Panhe Pilot Test Project (referred to as Panhe Project): This project is a national coalbed methane development project approved by the National Development and Reform Commission. Utilize high-tech industrialization demonstration projects. It is planned to construct 900 coalbed methane wells, which will be completed in three phases. In the first phase, 150 coalbed methane production test wells were constructed and completed in 2006. A coalbed methane production demonstration base with an annual coalbed methane production of approximately 1×108m3 was built. In the second phase, 400 coalbed methane production wells are planned to be constructed, with a production capacity of 4×108m3. /a; In the third phase, 350 coalbed methane production wells are planned to be constructed, with a production capacity of 7×108m3/a. By the end of 2005, the drilling of 100 wells, fracturing of 40 wells and surface engineering construction had been completed. On November 1, 2005, the company officially began to supply compressed coalbed methane to the outside world, with a daily gas production of approximately 7×104m3.

(5) Duanshi Coalbed Methane Development Demonstration Project in Qinshui County, Shanxi Province: This project is a key project among the national oil and gas resource strategic selection and evaluation projects undertaken by China United Coalbed Methane Co., Ltd. The purpose of this project is to exploit coalbed methane using multi-branch horizontal well drilling technology in the Duanshi area, evaluate its coalbed methane production potential, and form a complete set of mining technology for coalbed methane mining using multi-branch well drilling technology. Following the successful implementation of a multi-branch horizontal well in Coal No. 3 of Duanshi Block in Shanxi Province by China United Company in 2005, another multi-branch horizontal well was successfully constructed in Coal No. 15 in the area in 2006. After drainage testing, currently The daily production of a single well has reached more than 7000m3, and it is predicted that the daily production of a single well will reach more than 4×104m3. The success of this project will be of great significance to the efficient development of coalbed methane resources in my country, especially in the rapid extraction and utilization of coalbed methane resources before coal mining in high-gas mining areas, and to curb major gas accidents in coal mines.

1.4 Drainage and Utilization of Mine Gas (Coalbed Methane)

According to statistics, by the end of 2004, key state-owned coal mines had built 308 sets of coal mine gas surface drainage systems and underground mobile drainage systems. There are 272 sets, the gas extraction volume is 18.66×108m3 (see Figure 1), and the extraction rate is 26.5%. The gas extraction volume of 45 coal enterprises under key safety monitoring is 16.95×108m3. The mining areas with annual extraction volume exceeding 1×108m3 include Yangquan, Huainan, Shuicheng, Panjiang, Songzao, Jincheng, Fushun, etc. Among them, Shanxi Yangquan, Anhui Three high-gas mining areas, including Huainan and Fushun, Liaoning, account for one-third of the country's gas drainage volume.

Figure 1 Histogram of total gas extraction volume from key state-owned coal mines from 2001 to 2004

Currently, the utilization of underground coalbed methane is low, less than 50%, mainly for residential use in mining areas. Natural gas and self-generated power generation, a small part is used for welfare undertakings and industrial raw materials, and a large part is emptied. This part of the resource is a huge waste, and there is also a lot of room for development and utilization. It should attract the attention of relevant government departments and relevant enterprises.

1.5 Current preferential policies

First, the development and utilization of coalbed methane is levied a 5% value-added tax, and the input tax is not deducted; second, the implementation of "two exemptions and three half reductions" - Chinese and foreign Enterprises that jointly mine coalbed methane are exempted from corporate income tax in the first and second years starting from the year when they start to make profits, and corporate income tax is halved from the third to fifth years; third, the imports required for coalbed methane exploration and mining projects Materials are implemented in accordance with the import tax policy for oil and natural gas; fourth, the price of coalbed methane is determined by negotiation between the supply and demand parties in accordance with market economy principles.

1.6 Problems existing in coalbed methane exploration and development in my country

(1) Policy support for coalbed methane development and utilization is insufficient. The comprehensive social benefits of developing and utilizing coalbed methane are far greater than its economic benefits. Especially in the early stages of the development of the coalbed methane industry, the government should provide more preferential policies to encourage companies to engage in coalbed methane exploration and development. For the rapid development of the coalbed methane industry in the United States, early government encouragement policies played a decisive role.

(2) Investment in coalbed methane exploration, development and science and technology is too low and scattered, and some key technologies and equipment need to be improved. Coalbed methane is a high-investment, high-risk, and high-tech industry. To master its basic occurrence laws and development technology, large initial investment and relatively advanced instruments and equipment are required.

(3) The conflict between coalbed methane exploration and development and coal, oil and gas exploration blocks gradually emerged. Coal and coalbed methane are closely related. Coal mining and gas extraction must be organically combined to develop in a coordinated manner. Otherwise, it will not only waste resources and pollute the environment, but also threaten the safety of coal mines.

(4) The basic pipe network is weak. my country's basic natural gas pipeline network is relatively weak. Coalbed methane companies must not only build internal wellfield pipe networks, but also consider long-distance pipeline network construction, which virtually increases the company's production costs and affects the company's economic benefits and enthusiasm for developing coalbed methane. In addition, our market mechanism is not perfect enough, and the low gas price relative to oil price is also an important factor affecting the development of coalbed methane.

2 Opportunities and prospects for promoting the rapid development of my country's coalbed methane

2.1 The central government attaches great importance to and cares about the development of the coalbed methane industry

Premier Wen Jiabao clearly stated: " The development and utilization of coalbed methane can not only control gas, but also utilize energy. It kills two birds with one stone. We should increase the intensity of scientific research, exploration and development.

"On June 15, 2006, the General Office of the State Council issued the document Guobanfa [2006] No. 47 "Several Opinions on Accelerating the Drainage and Utilization of Coalbed Methane (Coal Mine Gas)", which stipulated a series of measures to encourage and accelerate the exploration and development of coalbed methane. Effective measures for coalbed methane and utilization will play a huge role in promoting the rapid development of coalbed methane in my country.

2.2 Energy, environment, and coal mine safety production urgently need to accelerate the development and utilization of coalbed methane.

Our country is short of oil and gas resources, but rich in coalbed methane resources, which is currently the most realistic natural gas replacement resource. Our country is also a major coal-producing country. In our country, high gas and gas outburst mines account for more than 46%. Every year, gas accidents cause national property and investment losses. It causes huge losses to people's lives. At the same time, coal mining emits more than 120×108m3 of methane into the atmosphere every year, causing huge environmental pressure and waste of resources. Therefore, mining gas first and coal later can greatly reduce coal mine accidents and is beneficial to Coal mine production safety and energy conservation

2.3 The government has formulated the “Eleventh Five-Year Plan” for coalbed methane development.

In the past, there was no unified national special plan for the development and utilization of coalbed methane. The planning is divided into coal, petroleum and other industries, and the planning is not systematic and poorly implemented. This is also one of the factors affecting the rapid development of my country's coal bed methane. Recently, the National Development and Reform Commission has organized relevant departments to formulate the national "Eleventh Five-Year Plan" for coal bed methane. According to the development and utilization plan, by 2010, the national coalbed methane (coal mine gas) output will reach 100×108m3, of which the output of coalbed methane from surface development will be 50×108m3, and the coalbed methane extracted from underground coal mines will be 50×108m3, and 3,000 new proven coalbed methane reserves will be obtained. ×108m3, with a total investment of 300×108 yuan (including exploration, development, pipeline network, and scientific research), to realize the industrialization of coalbed methane. The formulation of the national plan clarified the development goals of the coalbed methane industry and provided the government with a basis for formulating coalbed methane industry policies. Based on this, enterprises will be guided to invest in the coalbed methane industry and accelerate the development of the coalbed methane industry.

2.4 The establishment of the National Engineering Research Center for Coalbed Methane will promote the development, promotion and application of key coalbed methane technologies

On March 6, 2006, the National Development and Reform Commission approved the establishment of a national engineering research project for the development and utilization of coal-bed methane by China United Coalbed Methane Co., Ltd. Center. The center will focus on the major technical needs of coalbed methane development and utilization, build technology research and development and engineering test facilities for coalbed methane exploration, development, processing and utilization in my country, and conduct complete engineering and integrated application research on major scientific research results in the coalbed methane industry. , digest and absorb the introduced advanced technology, establish an engineering technology system for coalbed methane development and utilization suitable for my country's geological conditions, provide a platform for cooperation and exchange between industries, become a base for talent training in the coalbed methane industry, and provide a platform for enterprises related to coalbed methane development and utilization. Provide technical support and services to promote the overall technological progress of the coalbed methane industry

2.5 Coalbed methane development technology is improving day by day, and some key technologies have made breakthroughs

2.5.1 Coalbed methane well air. /Atomization drilling technology

This technology is commonly used in the development of coal seam methane fields in the United States, accounting for more than 90% of development wells. Its advantages are short drilling cycle (2 to 4 days), high efficiency, and low cost. , causing little damage to coal seams. The national "Tenth Five-Year Plan" science and technology project "Research on Underbalanced Drilling Technology for Coalbed Methane", combined with the geological characteristics of China's coalbed methane, developed air drilling design software and formed a series of air drilling technologies, which have been widely used in the Panhe Demonstration Project in Shanxi , shortening the drilling cycle from more than 15 days to less than 5 days, which not only reduces the construction cost, but also avoids damage to the reservoir by the drilling fluid.

2.5.2 Multi-branch horizontal well drilling and drainage technology

Multi-branch horizontal wells in the United States are implemented in conjunction with coal mine planning from the beginning, and generally can achieve 80%~ within 5 years With a gas recovery rate of 85%, this can greatly improve the coal mining operating environment and promote safe production in coal mines. Its comprehensive economic and social benefits are very obvious. There are many gas accidents in coal mines in my country, and the permeability of coal seams is low. There is an urgent need to promote this technology to ensure safe production in coal mines and save clean energy.

In November 2004, the DNP02 multi-branch horizontal well designed and constructed by Orion Company was officially put into production and achieved breakthroughs in expected technology and productivity. The total footage of the horizontal wellbore in the coal seam reached 8000m, and the daily production of a single well was stable at more than 2×104m3. , the oil and gas strategic selection Duanshi horizontal well demonstration project undertaken by China United Company has successfully implemented two multi-branch horizontal wells in Coal 3 and Coal 15 respectively, with a single well productivity predicted to be more than 2×104m3.

2.5.3 Drainage technology of long underground horizontal boreholes in coal mines

Through the national “10th Five-Year Plan” research project, domestic drilling rigs were used to make long underground boreholes reach a horizontal distance of 500m. Domestic tests of imported drilling rigs have enabled the maximum hole depth to reach 1002m, and the maximum footage per shift to 400m. The promotion and application of this technology can not only promote safe production in coal mines, but also greatly improve the production efficiency of coal enterprises.

2.5.4 Coalbed methane reservoir stimulation technology

Reservoir stimulation is a key link in coalbed methane development. Currently, the clear water and sand fracturing method is mainly used in the Qinshui Basin. Clean fracturing fluid technology has been successfully tested in the Hancheng well group. In the Shenbei mining area, small cave completion technology was used to transform lignite, accumulating experience for the development of low-rank coal bed methane. In particular, nitrogen foam fracturing was demonstrated in Panhe. The project achieved great success through two well experiments. The drainage showed that the production of coalbed methane wells was doubled compared to that of coalbed methane wells under the same conditions, and it has good prospects for promotion and utilization.

2.6 The Panhe pilot test project of Qinnan coalbed methane development and utilization high-tech industrialization demonstration project will effectively promote the development of my country's coalbed methane industry

The National Development and Reform Commission approved the implementation of this demonstration project at the end of 2004 The project is located in Qinshui County, Shanxi, with a gas-bearing area of ??24.2km2. The demonstration content includes drilling, production stimulation and transformation, coalbed methane gathering and transportation, pressurization, data transmission, ground engineering construction, etc. At present, 100 drilling wells in the first phase have been completed, and 40 production wells have been in operation for more than half a year. The entire facility is operating smoothly and the gas production is good. By testing the entire process of coalbed methane surface development, we will accumulate coalbed methane development technology and management experience, which will play a positive role in promoting the large-scale commercial utilization of my country's coalbed methane resources, especially for the large-scale development of coalbed methane fields in the Qinshui Basin. The development obtained first-hand information and laid a good foundation.

2.7 The Clean Development Mechanism (CDM) promotes the development and utilization of coalbed methane in coal mining areas

The "Kyoto Protocol" came into effect in February 2005. The Clean Development Mechanism (CDM) is the "Kyoto Protocol" It is a compliance mechanism for developed countries to realize part of their emission reduction commitments overseas. Its core is to allow developed and developing countries to transfer and obtain "certified emission reductions (CERs)" based on investment projects. The development and utilization of coalbed methane is an important area for the implementation of CDM projects. The main component of coalbed methane is methane. The greenhouse effect of methane is 21 times that of carbon dioxide. The current international carbon indicator is 5 to 10 US dollars per ton. The average coalbed methane drainage rate in my country's coal mining areas is currently only 32%. The drainage volume in 2004 was 18.6×108m3, and the coalbed methane utilization is less than half. If funds and technical support are introduced through the CDM mechanism, it will play a positive role in promoting the development of the coalbed methane industry itself and promoting the utilization of coalbed methane in coal mining areas.

2.8 The basic pipeline network facilities are constantly improving

The lack of natural gas transmission pipelines is an important external condition restricting the development of coalbed methane in my country. With the operation of the "West-East Gas Pipeline" pipeline, it provides a good opportunity for great development for the exploration, development and utilization of coalbed methane in relevant areas. The "West-East Gas Pipeline" pipeline passes through many major coalfields in my country, such as the Zhunnan Coalfield in Xinjiang, the Hedong Coalfield in Shanxi, the Qinshui Coalfield and the Huainan Coalfield. These coalfields are areas with good coalbed methane resources in my country and are also the current coal seams in my country. Hotspot areas for gas exploration and development. In addition, the construction of the Shaanxi-Beijing double line and the implementation of the coalbed methane pipeline planned by Shanxi Province will also provide good basic conditions for the gathering, transportation and utilization of coalbed methane.

3 Conclusion

To sum up, in our country, the abundant coalbed methane resources provide us with a good material foundation, and the rapid development of the national economy provides huge market demand. Decades of experience have been accumulated in underground coal mine gas drainage, and surface exploration and development of coalbed methane has a history of more than ten years. The technical means of coalbed methane exploration and development are becoming increasingly perfect and mature.

At present, the central government attaches great importance to the development of coalbed methane, formulated a special development plan for coalbed methane, approved the establishment of the National Engineering Research Center for Coalbed Methane Development and Utilization, and issued the "Several Opinions on Accelerating the Drainage and Utilization of Coalbed Methane (Coal Mine Gas)" The document stipulates a series of powerful measures to encourage and accelerate the exploration, development and utilization of coalbed methane. The external environment for coalbed methane development is getting better and better, creating good opportunities for the leap-forward development of my country's coalbed methane industry. According to the current development status and development trend of my country's coalbed methane industry, it is possible to achieve the goals set by the "Eleventh Five-Year Plan" for coalbed methane development by 2010, with the Qinshui Basin as the focus, and achieve an annual output of 50×108m3 of surface-developed coalbed methane. 50×108m3 of coalbed methane is extracted underground in coal mines to serve coal mine production safety and contribute to building a harmonious socialist society.

References

[1] Editors-in-chief Feng Sanli and Ye Jianping. 2003. Research on key technologies for coalbed methane exploration and development in China. National “Tenth Five-Year Plan” scientific research report

[2] Chief editors Feng Sanli and Ye Jianping. 2005. Research on supporting technologies for coalbed methane exploration and development in China. National "Tenth Five-Year Plan" scientific research report

[3] China United Coalbed Methane Co., Ltd. 2000. Qinshui Basin Report on new coalbed methane reserves in coalbed methane fields, internal information