DOE Selects PCI's Methane Hydrate Recovery Process for Advanced Development

NORTH HAVEN, CT -- (June 3, 2005) -- Precision Combustion, Inc. (PCI) announced it has been awarded a U.S. Department of Energy Small Business Innovation Research (SBIR) Phase II grant to develop a catalytic combustor to generate heat downhole, with the purpose of efficiently producing natural gas from subsurface natural gas hydrate beds. The project offers an enabling technology for substantially increasing U.S. energy production and accessible energy reserves, for increasing U.S. energy independence, and potentially for co-sequestering CO2. A potential spinoff application will be for downhole steam generation for energy-efficient production of heavy oil and extra heavy oil.

Most of the world's natural gas is believed to be in the form of gas hydrates, primarily methane with other natural gas molecules in ice lattices beneath the earth's surface. The U.S. Geologic Service has estimated some 200,000 trillion cubic feet (tcf) of natural gas in the form of gas hydrates in the U.S. alone, mostly in subseafloor or sub-permafrost regions. Gas hydrates could offer total energy reserves well in excess of worldwide oil and gas reserves. For comparison, total U.S. usage of natural gas is approximately 30 tcf per year. Natural gas hydrates thus offer a potential future energy source that could help America achieve energy independence while reducing reliance on oil and helping to promote a hydrogen economy.

Scientists worldwide are working to study natural gas hydrates and approaches to producing gas from hydrates. "The most effective approach would be to add enough heat to melt the subsurface ice, which releases the natural gas", reports PCI President Kevin Burns, "but this is complicated by the location of the hydrate, e.g. subseafloor or beneath polar permafrost layers. Heat generated at the surface and sent downhole would end up losing most of its energy before it reaches the hydrate, an uneconomic approach. Our approach has been to develop a compact enough catalytic combustor with appropriate controls so that we could send the burner down a gas well and actually generate the heat downhole where the hydrate is, maximizing energy efficiency. In addition, there may be the potential for sequestering CO2 into its hydrate form, releasing more heat for use in dissociating methane."

PCI Chief Scientist Dr. William Pfefferle explains the PCI approach: "We have developed a breakthrough catalytic combustor for near-zero emission gas turbines, which is now being explored by several gas turbine manufacturers for use in their engines. This technology is ultimately a very compact, high pressure burner with excellent control and flame stabilization. We are adapting the gas turbine technology to the needs of doing the heat generation downhole, developing a practical and controllable compact wellbore combustor capable of high BTU downhole heat generation. Our Phase I work showed very low energy costs as a fraction of the produced natural gas, and we were pleased to be invited to report our findings at this past September's Hedberg conference on hydrates. During Phase II, we will design and test a full scale combustor suitable for downhole operation. We're being helped in this by an oil and gas producer and an energy services provider."

Burns continues, "Our approach offers the potential for a high payoff even down to hydrate concentrations as low as three percent by volume in the reservoir formation. There is of course much other necessary work ongoing relating to better understanding of reservoir and hydate behavior, and to planning the best ways to tap the hydrate reservoirs. We believe our work will provide a viable production tool for producing gas from hydrates that will prove very useful to gas producers when they are ready to start tapping this large energy resource. Meanwhile, we are encouraged by the level of interest we are now receiving from industry participants, and also following up the spinoff opportunity to use this technology for downhole steam generation for producing heavy and extra heavy oil." Precision Combustion, Inc. (www.precision-combustion.com) is a clean energy technology company developing a range of catalytic devices and systems for clean and efficient combustion, pollution control and the chemical process industry.

PCI currently focuses on RCL®™ gas turbine products and Microlithfast response catalytic reactors for fuel processors, IC engine emissions after treatment, chemical reactors, and other applications. Customers of PCI include gas turbine, aerospace system, automotive, fuel cell, and fuel reformer manufacturers as well as the U.S. government.

For more information, contact: Tony Anderson
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