Methane — deadly one millennium, energy saviour in another.
Just 248 million years ago — give or take a year or two — all but 4% of life on earth was wiped out by what was named the Permian mass extinction, aka “the great dying.” The most popular theory is that there was a massive methane explosion, possibly from the ocean floor, which poisoned the atmosphere leaving the great bulk of creatures unable to survive. (Now that’s climate change.)
Now methane — in the form of methane hydrate — may be about to come to the rescue of the world, or at least of Russia and Japan.
The Russians, as we know, dominate the gas supply situation in Europe, a fact which rankles with all those EU and former Soviet countries which feel they are held hostage by Moscow for their energy. The country is also one of the oil exporting majors.
But the Russians are not resting on their laurels. For one thing, they are working hard on harnessing their vast shale resource of Siberia. According to The Financial Times, the Russians are looking at depletion rates causing a drop in oil output from 10.1 million barrels a day in 2010 to 7.7 million by 2020. The oil companies are targeting what is known as the Bazhenov, a vast geological formation in Siberia; the theory is that it could be the world’s largest shale oil resource, bigger than the Bakken shale in the U.S. The newspaper quotes recoverable resources of 100 billion barrels, five times more than what is contained in North Dakota’s Bakken.
Now the Russians are investigating what lies beneath Lake Baikal in Siberia. They are hoping it is methane hydrate, a solidified form of natural gas enclosed in ice. The latest edition of the New Scientist magazine says this hydrate form of gas may be the greenest of the fossil fuels. When burnt, methane releases smaller amounts of carbon dioxide than does coal or oil (and there’s almost no ash and zero mercury).
As the magazine points out, methane hydrate accumulations exist in quantities that dwarf all other fossil fuel reserves — trillions upon trillions of cubic feet stored around the globe.
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I have reported previously on the fact that Japan believes that frozen areas under the seabed off Aichi and Mei contain 49 trillion cubic feet of methane hydrate. Earlier this year, a research team extracted some gas from the hydrates. They drilled in water about 1,000 metres deep, sinking a hole another 330 metres to find the gas.
And just six weeks ago here on InvestorIntel I reported that Alaska and the U.S. Department of Energy plan to extract methane from hydrates on the North Slope, the northern part of Alaska which borders the Chukchi Sea and the Beaufort Sea.
A month ago Fortune magazine caught up with the Japanese efforts. It made the point that methane hydrate potentially holds enough gas reserves to provide more energy than all the world’s known gas and oil reserves combined. The Japanese plan is to drill into the deposits to produce water to decrease the pressure, allowing the gas to separate from the ice-like material and flow up to the wellhead.
But Fortune also pointed out that environmentalists “are horrified” at the idea of tapping methane, a “greenhouse gas that is 20 times more potent than carbon dioxide”. Well, yes, but as the New Scientist pointed out, unburnt methane may have a far higher greenhouse impact than carbon dioxide, but it lingers in the atmosphere for less time.
Now the Norwegians are looking to get in on the race, too. At the Arctic University at Tromsø, they have established a new Centre for Arctic Gas Hydrate, Environmental and Climate.
We may be just at the beginning of an extraordinary gas technology story.
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