Frozen gas supply dreams to meet cold, harsh reality

Take a world hungry for new energy, suggest a huge untapped trough of frozen gas on the doorstep of the biggest consumers, and it’s easy to fathom why some governments are salivating over methane hydrate.

But even proponents say the cost, technology and environmental hurdles in developing the resources — mostly subsea deposits that promise vast gas reserves — mean it could be a decade or longer before any real results are delivered.
Oil companies such as BP that have for years avoided the deposits of unstable hydrates — considered a hazard in drilling for oil or gas — are slowly investing tiny slivers of their budgets on research. Academics and governments are as well.

Hydrates are solid ice-like crystals formed from a mixture of methane and water at specific pressure and conditions — under hundreds of meters of water, or closer to the surface in Arctic permafrost. They vaporize and ignite at room temperature.

Since oil prices have trebled in the past several years and energy security fears grown, the attraction is clear: the U.S. Department of Energy puts estimated global hydrate resources at 875,000 trillion cubic feet (tcf) of natural gas, more energy content than all the world’s coal, oil and natural gas combined.

The obstacles are just as vast, including unknown development costs, the lack of an established technology to extract the methane and the potential for releasing a potent greenhouse gas into the atmosphere.

“Right now the cost of extracting gas hydrate is probably still too high,” says Liu Char-shine, one of the chief scientists involved in Taiwan’s gas hydrate exploration project off the southwest coast, where the island believes it has found enough reserves to meet its energy needs for 60 years.

That did not stop investors from pushing shares in state-run gas importer Korea Gas Corp. to a record high last week amid exuberance over a South Korean hydrates find.

And slowly some of the oil industry is getting involved.

Reuters