BC-WY-Oil Field Revival-Institute,Adv25,800

Adv25

For release Monday, July 25

Wyoming college helps operators with recovering more oil

AP Photo planned

By BOB MOEN

Associated Press Writer

BAIROIL, Wyo. (AP) - Every day, about 160 million cubic feet of carbon dioxide and about 170 thousand barrels of water are forced underground to coax some 7,300 barrels of oil out of the ground at Merit Energy Co.'s two oil fields here.

Despite the water and CO2 flooding, oil production from the oil fields first tapped some 90 years ago continues to fall bit by bit.

In hopes of extending the life of the fields and to squeeze more of the estimated 470 million gallons of oil still in the ground, Merit Energy is turning to scientists at the University of Wyoming's Enhanced Oil Recovery Institute for help.

The institute, based in Laramie, doesn't charge for its services. It benefits from being able to test new methods and ideas in the field without having to spend money on expensive equipment and materials.

"By the producer allowing us to get involved with them, they benefit from our expertise and we benefit from having a field laboratory," said Jim Steidtmann, director of the institute. "We get better at doing this, and they get more oil out of the ground."

Merit Energy, an independent producer based in Houston that specializes in trying to revitalize older oil fields, had never worked with the UW institute until now.

"Most independent producers don't have the people on staff with the expertise that they do," said Jason Wacker, a petroleum engineer with Merit Energy. "It's definitely been a positive experience so far."

Merit Energy's Lost Soldier and Wertz fields at Bairoil in south-central Wyoming are among the oldest in the state. The first well was drilled in the area in 1916.

Thanks to water injection - pumping water into the ground to force oil toward the wells - oil production at Lost Soldier peaked at about 19,300 barrels a day in 1979, while Wertz reached around 13,400 barrels in 1981. But by June 1986, Wertz production had fallen to near 6,400 barrels a day and by 1988 Lost Soldier had dropped off to about 3,300 barrels.

Because oil and water don't mix, water leaves a lot of oil behind. But carbon dioxide can latch onto oil particles, carrying them toward the well. CO2 injection - pumping carbon dioxide and water into the ground - began at Wertz in 1986 and at Lost Soldier in 1988.

There is a trade-off - CO2 flooding is much more expensive than water flooding. But CO2 allows developers to capture so much more oil, it makes economic sense, especially as oil prices have risen.

The combined water and CO2 injection resulted in each field producing around 14,000 barrels of oil a day. But even with the heavy use of water and CO2, production began to wane again.

"It's falling off over the years," said Rex Dunlap, operations manager for Merit Energy in Bairoil.

The two fields, which Merit Energy bought in 1999, now produce about 7,300 barrels a day.

Mike Boyles, a geologist with the institute working with Merit Energy, said his job is to help the company save money by becoming more efficient in extracting oil and to identify remaining oil deposits that can be tapped.

For instance, his studies seek to help Merit Energy determine where water and CO2 injection wells would be best placed in the field. Some wells could be producing too little oil to warrant the cost of running them, Boyles said.

With millions of dollars worth of compressors, pipes and special equipment to separate the oil from water and CO2, just the electricity costs Merit Energy could save by shutting down inefficient wells could pay huge dividends, he said.

"The institute helps you get more bang for your buck," Wacker said.

Through the partnership, the fields should produce more oil longer to help supply the nation's thirsty appetite for the resource, the institute should be able to apply any new knowledge it gained to other older fields in the state and both Merit Energy and the state would benefit financially through more efficient production and additional taxes.

Steidtmann said over a 20-year period, CO2 and other enhanced oil recovery techniques will result in the boost the state's oil industry.

Steidtmann said the institute has several more requests pending from other oil producers for its help.

He hopes the increasing demand for the institute's services will persuade lawmakers to allow it to hire more scientists and engineers.

Bruce Hinchey, president of the Petroleum Association of Wyoming, said Wyoming has many old fields that could benefit from the institute's aid.

"Hopefully, this will help them revive their fields and increase production, help them and the state make some money," Hinchey said. ---

On the Net:

http://eori.gg.uwyo.edu

http://meritenergy.com