3 hurdles for Japan’s gas “discovery”

Japan Sea

Japan has just successfully mined natural gas from the sea, according to a New York Times report. While this might seem to be important news, it is neither new nor all that important. The availability of methane hydrates as a hydrocarbon resource has been known for centuries.

And for just about as long, people have dreamed of mining them. But dreaming and doing are far apart, and the Japanese research project is only a tiny step towards the economical and safe exploitation of methane hydrates. Before that reality, a number of very significant advances have to be made:

1). Environmental containment: Methane hydrates are ice crystals with a few molecules of methane trapped inside. But the crystals aren’t blocks of ice like what is in your freezer. They are lattice-like frames that crumble very easily. Thus any disturbance to a methane hydrate bed can lead to a cascade of collapsing crystals, followed by one big belch of methane gas from the seabed.

This is bad for two reasons. The gas you want to mine can get out of your grasp, and the bubble of valuable hydrocarbons now enters the atmosphere, where it collects heat at nearly twenty times the rate of carbon dioxide. Some even speculate that methane burps from the seabed caused ancient global warming incidents.

How do you stick a drill-pipe into a sediment that has a consistency of cobwebs, without disturbing it? There’s probably an answer out there waiting to be discovered — but nobody knows how to do it today. And there’s no sign that the Japanese drilling experiment is successfully doing so.

2). Economics: Most methane hydrate deposits exist underneath dozens or hundreds of feet of mud and gravel. Where the mud stops and the methane starts is a very blurry line. Thus the fluid that’s brought to the surface will include an enormous amount of extraneous material. That’s a problem that can be solved relatively easily, but not cheaply.

Separating the methane from everything else will be an enormously expensive task that far exceeds the separation requirements of current “tight” natural gas resources (such as coal-seam methane and shale gas). There’s no simple way around that cost, which means the extraction costs of seabed methane will always be higher than any other gas deposits. At current natural gas prices of $3.64 per MMBTU, there’s no reason for anyone to invest in methane hydrate projects.

3). Infrastructure: There is no industrial infrastructure currently built to mine, process and deliver methane from seabed deposits. Unlike traditional underground formations that are highly concentrated, seabed methane beds are spread out over extremely large areas.

To eventually extract that methane will probably require specialized floating infrastructure that can follow the resource. While certainly not a deal-killer, the creation of an entirely new infrastructure to gather the hydrates and turn them into usable fuel is a good reason to not spend a few tens of billions of dollars on all-new, untested equipment.

While some of the breathless reports about the Japanese “discovery” (there’s really nothing special about the Japanese project, several other Japanese and Canadian experiments have successfully brought up methane from hydrate beds) claim that a brand new fossil fuel resource has been stumbled upon, the facts are a little less fantastical.

Yes, there is an enormous amount of methane laying on the world’s seabeds. And yes, there are probably some ways to get it to the surface. But the chances are that most of it will continue to sit there for centuries to come.

This article originally appeared on the blog of Pike Research. Pike Research, a part of Navigant Consulting’s global Energy Practice, is a market research and consulting team that provides in-depth analysis of global clean technology markets. Pike Research is also a partner of GigaOM Pro, GigaOM’s premium research service.

Image courtesy of shunkoh, Flickr Creative commons.

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