ADI presented at two sessions some of its research and insights based on its consulting work at the 2018 World Gas Conference in Washington, DC last week. The first focused on natural gas use — CNG and LNG, in particular — in the oilfield.
U.S. natural gas supply will continue to be cheap and abundant driving its use in new and emerging applications. One such application is fueling the oilfield equipment with natural gas. There are four sources of natural gas for use in the oilfield including as (1) field gas, (2) pipeline/sales gas, (3) liquefied natural gas (LNG), and (4) compressed natural gas (CNG).
We looked at the feasibility of using each of these sources of natural gas in the major U.S. shale plays including Marcellus and Utica, Haynesville, Permian, Eagle Ford, Barnett, Fayetteville, Bakken, and Niobrara. This was accomplished by looking at existing infrastructure which includes gas pipelines, storage, processing plants, CNG, and LNG infrastructure.
Most shale plays have sufficient pipeline and gas processing capacity and have counties with the most drilling activity within short distances of gas processing plants. CNG and LNG infrastructure is limited and may require capital investments. Gas quality varies across shale plays thus limiting the use of field gas to only a few select number of plays.
Marcellus and Utica are the plays best positioned to adopt natural gas as fueled equipment given their strong infrastructure, pricing, and quality of natural gas. Natural gas use to fuel oilfield equipment will likely be limited in the medium term but there are unique circumstances in which it becomes an attractive alternative to diesel.
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