Shell eyeing Kuzbass coal methane extraction
KEMEROVO. Sept 24 (Interfax) - Shell is thinking of extracting coal methane in the Kuznetsk basin (Kuzbass), Kemerovo region, the region's governor, Aman Tuleyev, told reporters during a meeting with Shell representatives.
Russian gas giant Gazprom holds rights to two coal methane deposits in the Kuzbass. Tuleyev said the region hosted another three deposits which did not overlap with the Gazprom deposits.
"Gazprom is already producing 20,000 cubic meters of methane per day," he said.
"We've already discussed this with eight [other] companies besides Gazprom, but they raise doubts as regards scale and magnitude. But I don't see any difficulties [working with Shell]," he said.
The Kuzbass is receives "almost 4 billion cubic meters of gas from outside, while we have 13 trillion cubic meters right under our feet," he said.
Shell's representatives said they discussed "the possibility for exploration in the region and determining the potential for commercial methane production," said Christian Bukovics, vice president for exploration at Shell Exploration & Production Services (RF).
"Russia is a country of strategic importance, both for upstream and downstream projects. We look at opportunities to develop our business on a constant basis. The Kemerovo region, as Russia's biggest coal province, is of interest to Shell, especially given our expertise and technology in producing methane from coal seams, however it is too soon to talk about anything more specific," Shell's press office told Interfax.
Vladimir Kovalev, the Kemerovo region's deputy governor for natural resources, said "a third company has emerged with serious intentions to enter the Kuzbass after Gazprom and CBM Partners Corporation (USA)." "This will benefit us immensely, both where the development of a new coal-gas industry and [coal mine] safety are concerned," he said.
If exploration goes well and if they launch a project, Shell "will build processing capacity and will be exporting products," Kovalev said.
Asked where the methane deposits were located, he said: "The central part of the region has not yet been covered - the Krapivinsky and Belovo districts, part of the Leninsk-Kuznetsky district and, according to our vision of the coal industry's development, possibly the Promyshlennovsky district." "The gas has to be removed before the coal can be mined," he said.
Russia has huge coal gas reserves - approximately 84 trillion cubic meters, or a third of the country's probable natural gas reserves. The first pilot project to extract this was launched at the eastern section of the Taldinsky coal-methane deposit, 65 kilometers north of the city of Novokuznetsk. It contained C1+C2 gas reserves as approved by the Russian Natural Resources Ministry of 45.8 billion cubic meters as of May 2009.
Gazprom Production Kuznetsk LLC holds licenses to explore and produce methane from coal seams in the Southern Kuzbass group of coal fields with methane resources of at least 5.8 trillion cubic meters.