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Generating Power from Waste Gas


When satellite photos showed bursts of light coming from the black night sky of rural North Dakota, it raised awareness about the practice of "flaring" wasted natural gas from the Bakken oil fields.

Huge flames light up the sky as the gas, a byproduct of oil production, is burned off day and night where there's no economical way to capture and use it.

In some places, "You can't see the stars. The sky is kind of a dark orange," said Sean Arithson, spokesman for Dakota Resource Council, an environmental group based in Bismarck, N.D.

Generac Power Systems of Waukesha and Kohler Power Systems, a division of Kohler Co., have equipment that captures some of the gas and turns it into usable electricity.

The portable generators, some roughly the size of a large pickup truck, burn the gas as fuel and provide electric power to the oil pumping operations.

The equipment captures "a fair amount of fuel" that otherwise would be burned off into the atmosphere, said Terry Dolan, a Generac executive vice president.

Generac and Kohler make generators for commercial and industrial uses as well as backup power for homes. Some of the largest units can provide enough emergency power to run an oil refinery or hospital.

The Bakken oil field units, which run 24 hours a day in remote areas of the Dakotas, are a growth area for Generac, Dolan said.

"A lot of these places are really far from where the utility lines go, but they need the electric power. With the flared gas, they have a constant flow of fuel coming out of the ground," he said.

Generac and Kohler sell the gas-driven generators to companies in the oil fields, which set them up to provide electric power that otherwise would come from diesel-powered generators.

A diesel-powered unit would burn 9 gallons of fuel an hour, 24 hours a day, to provide the electricity that comes from a generator burning the waste gas, said Mark Wald, president of Blaise Energy Inc., a Bismarck firm that provides the equipment and uses Generac products.

"It's crazy. There's a great big flare and fuel going up in smoke, while right next to it you have a diesel generator using fuel that has to be trucked in," Wald said.

Oil companies say they've spent more than $13 billion to capture the waste gas, mostly through pipelines, rather than burn it into the sky. But sometimes they have difficulty obtaining permission from landowners to place pipelines on their property, and it's cost prohibitive in remote areas.

North Dakota is considering state legislation that would drastically cut the time oil companies can burn off natural gas. It would require companies to begin paying royalties and taxes on wasted natural gas within 14 days after an oil well begins production. Companies are given a year now, but often they receive extensions because of the high cost of moving the gas to market.

The burned-off gas is valued at more than $1 million a month in lost state revenue, according to an Associated Press article.

"We want to get this gas, no question about it," Ron Ness, president of the North Dakota Petroleum Council, said in a recent hearing on the issue.

The Generac and Kohler generators use only a small amount of the waste gas from an oil well, but the units provide valuable power in areas where it would cost millions of dollars to run a utility line. They run year-round even in the harshest weather.

Reliability is important. It can cost a petroleum company $10,000 an hour in lost revenue if an oil well is not pumping because the generator shut down or something else went wrong.

Kohler has dozens of the gas-powered generators in the Bakken oil fields, said Nolan Landes, a senior products manager for the company's generator product line.

The units also are used in oil fields in Texas, Oklahoma, Canada and overseas.

Once a well is established, the waste gas is essentially a free source of fuel, Landes said.

But it's difficult to maintain machinery in remote locations, where the temperature can drop to 30 below zero. Also, the gas coming out of the ground from an oil well contains impurities that have to be removed before it's suitable for powering a generator.

"It's not like the gas that comes out of a pipe into your home," Dolan said.

Sensors in the generators are constantly checking the fuel quality and adjusting the units to run on it. Backup systems, such as propane tanks, can be used if a problem arises with the gas coming out of the ground.

The gas is valued at only a fraction of the value of the oil being produced. But there's still incentive to capture it as an energy source, Blaise Energy's Wald said.

With lower oil prices, "Everybody's looking at trimming costs," he said. If an oil field operator can save money by replacing diesel generators with gas-driven units, they're moving in that direction.

"We are not slowing down with the drop in oil prices," Wald said.

"We have seen significant growth in the call for generators to use the waste gas that's been flared for years," Dolan said.

Article cited from: http://goo.gl/c1jcxv