Killing two birds with one oily rock

Professor Zeng Rongshu flew back to Beijing on New Year's Eve with something rather unusual in his suitcase: rocks.

They were no ordinary rocks. Black and covered in oil, they were the fruits of two years spent trudging across some of the remotest parts of the country in search of an answer to a question that could have huge economic consequences.

Can carbon dioxide emissions be used to dramatically increase oil production on the mainland?

That is what Zeng, a geologist from the Institute of Geology and Geophysics, Chinese Academy of Sciences, is trying to find out.

Zeng's research, into the suitability of mainland oilfields for storing carbon dioxide, is part of an ambitious national research programme, funded by the China National Petroleum Corporation (PetroChina), on carbon capture and storage (CCS) technology.

CCS is one of the most talked-about methods of cutting greenhouse gas emissions. While hugely expensive, its implications for extracting the rest of the world's oil supplies makes it highly significant.

China was the world's fifth-biggest oil producer in 2008, ahead of the United Arab Emirates, Venezuela and Iraq. Its is not 'easy' oil, however - reserves are hard to reach and harder to extract.

With domestic production meeting less than half the mainland's demand for oil, that demand rising rapidly and plenty of money to spend on research, it is no surprise that China is playing a leading role in CCS development and is on course to become the first country to implement it in industrial production.

Professor Cai Ningsheng, head of thermal engineering at Tsinghua University, is one of the lead scientists on the CCS programme and heads a team developing methods to capture carbon dioxide from coal-fired power plants.

'A big headache is quantity. Burning a tonne of coal produces more than two tonnes of carbon dioxide. We must address how to deal with such a mass,' Cai says. 'Energy loss is another problem that we need to crack. Carbon dioxide must be isolated, concentrated and transported to the storage location via pipelines. Each step consumes energy. Currently a power plant will lose about 10 per cent of the total energy it generates if it engages in CCS.'

The biggest barrier to implementing CCS is cost. But according to Cai, PetroChina is willing to invest. 'PetroChina gave us 200 million yuan (HK$227 million), which is more than five times the amount we received from the government,' Cai says.

'People at PetroChina told me as soon as I bring the capturing cost down to US$20 per tonne, they'll use it. It's a tough target - the current cost is US$40 - but it's not impossible.'

Professor Shen Pingping, chief scientist of the programme and a member of the Research Institute of Petroleum Exploration and Development under PetroChina, wrote in a paper last year that the mainland's oil industry had a huge demand for carbon dioxide.

'Most of the oil in China is trapped in continental sedimentary reservoirs. They are sticky. Even after flushing with water the average excavation rate is only 32 per cent. That means if we don't use a more effective method, nearly 70 per cent of the oil is stuck,' Shen wrote.

'Pumping CO2 can increase the excavation rate significantly. We have done some experiments in existing oilfields and it worked well. The biggest obstacle, however, is that we don't have enough CO2 supply.'

CCS could increase China's domestic crude oil production by more than 3 billion tonnes, or nearly 30 times total imports in 2005, according to the paper.

Zeng says that storing CO2 in oilfields is win-win because it addresses global warming and the energy crisis simultaneously.

'An oilfield is an ideal container for CO2. If we [are] careful it will remain underground for a very long time. Meanwhile, removing CO2 from the power plant's emissions will reduce China's carbon intensity, thus fulfilling our promise at [the] Copenhagen [global climate summit].'

However, critics say using CCS for oil production is an exercise in futility - the additional oil that is extracted creates even more carbon emissions.

Formidable technological obstacles still need to be overcome before CCS can be put into wide use.

Professor Yue Xiangan of the China University of Petroleum, another key scientist in the programme, says some of the CO2 pumped into oil wells comes back with the oil, meaning it must be collected and recycled.

'The theory sounds simple but it throws up some issues that have not been solved. First, how large a pump should we build? And there are many substances in the pipelines: crude oil, natural gas, dirt and CO2. Each has a unique physical property, and to predict how they move together we need to employ supercomputers and sophisticated models,' he says.

'We may not solve all of the problems, but experiments have already begun in some oilfields.'

Professor Cai says China is becoming a leader in CCS technology.

'Not long ago I made a speech about our progress at an academic meeting. A few days later a researcher from [the US government's] Lawrence Berkeley National Laboratory [in California] called. He complained that his technology remained in the lab while ours was already running and being tested in industry.

'What puzzles me is that some politicians and businesspeople from developed countries try to force China to buy their CCS technology. They do not allow researchers to share their findings freely,' Cai says.

'If we work together, the development cost will be lowered and it will happen quicker.'