Realizing the great potential of Alaska’s unconventional energy resources, which could include hefty amounts of viscous oil and methane hydrates, two government agencies have agreed to work together in hopes of moving development forward.

The Alaska Department of Natural Resources (DNR) and the US Department of Energy’s (DOE) Office of Fossil Energy signed a memorandum of understanding April 16 that essentially aims to strengthen collaboration for R&D and information sharing between the two agencies.

While the federal agency will develop R&D opportunities in Alaska and give scientific expertise and resources for projects, the state agency will work to resolve land access issues; arrange for state land leasing; coordinate infrastructure logistics, permitting, and regulation; and review and interpret scientific data, according to a news release.

The agreement aims to speed development of Alaska’s unconventional resources.

The DOE said Alaska’s North Slope is believed to have as much as an estimated 25 Bbbl of viscous oil in shallow sands. However, recovering the oil – known for its syrup-like consistency – will be both a technical and economic challenge.

The area also is believed to have about 85 Tcf of potentially recoverable gas in the form of methane hydrates based on US Geological Survey (USGS) estimates. Getting to this gas trapped in ice crystals could prove to be just as challenging.

“As a state, we want to responsibly develop and commercialize all of the North Slope’s energy resources, which include gas hydrates, shale and viscous oil, and other unconventional energy resources,” DNR Commissioner Dan Sullivan said in a prepared statement. “Simultaneously, the Department of Energy is strongly interested in demonstrating that these resources can be developed on an economic scale.”

DOE Acting Assistant Secretary for Fossil Energy Christopher Smith added, “By establishing a framework for our continued work with the state of Alaska, we will advance America’s energy development and research, including our understanding of methane hydrates – a vast, untapped potential energy resource. And this agreement will help ensure Alaska continues to play a critical role in supplying America’s and the world's energy needs.”

As part of the agreement,
• The DOE’s Fossil Energy office will work through the National Energy Technology Laboratory and its partners to develop R&D opportunities in Alaska and provide scientific expertise and resources to support projects;
• Alaska DNR’s Divisions of Oil & Gas and the Division of Geological and Geophysical Surveys will review and interpret data; and
• Alaska will take part in reviews of scientific data and reports.

The action is another step by the DOE to study unconventional resources in Alaska. The agency has awarded millions of dollars to various universities to conduct research projects involving methane hydrate extraction.

Just last year, results of a field trial conducted jointly by the DOE, ConocoPhillips, and the Japan Oil, Gas, and Metals National Corp. showed a technique that injects a CO2 and nitrogen mixture into methane hydrate successfully releases natural gas.

Japan also continues efforts to unlock gas from methane hydrate. On March 12, Japan Oil and Gas announced it extracted gas from methane hydrate using a depressurization method offshore Nankai Trough. The EIA estimates about 40 Tcf of methane hydrates could be offshore Japan.

The USGS said gas hydrates worldwide could contain more organic carbon than coal, oil, and other forms of natural gas combined. The EIA estimates the world’s gas hydrate resource varies from 10,000 Tcf to more than 100,000 Tcf.

However, “So far, gas hydrates have provided more problems than solutions. The formation of gas hydrates in deepwater production can hinder operations; managing or preventing their formation in deepwater oil and gas wells and pipelines has been a challenge for many decades, and addressing the existence of gas hydrates is a major part of planning for deepwater drilling and production,” the EIA said. “However, at some point in the future, gas hydrates could be a potential source of natural gas. When brought back to the earth’s surface, 1 cf of gas hydrate releases 164 cf of natural gas.”

Contact the author, Velda Addison, at vaddison@hartenergy.com.