Current Status
Present Arbuckle characterization indicates there is sufficient Arbuckle resource to support a pipeline and Kinder-Morgan continued support
Because the Arbuckle represents the prime resource base for a pipeline, Kinder-Morgan needs to focus most of its support on an Arbuckle demonstration
Present understanding of the LKC site indicates that an economically viable and risk-balanced CO2 flood without substantial Kinder-Morgan support requires
Additional reservoir characterization and testing
Reasons for moving on the present LKC project
The LKC demonstration gets CO2 into the ground at the soonest possible opportunity
A successful demonstration could lead to near-term expansion to commercial flooding which would be the best advertising for CO2 possible
More is known about the LKC and the present site than the Arbuckle
LKC architecture provides good containment of CO2
If the combined LKC and Arbuckle resource is risk weighted the LKC plays a crucial role in insuring sufficient resource for a pipeline
The proximity to the ICM ethanol plant offers lower cost CO2
Preparation for an Arbuckle demonstration will require more time than the LKC
Reasons for a larger LKC demonstration
A larger pattern offers the potential for profit to Murfin and could allow Kinder-Morgan to focus more resources on an Arbuckle demonstration
Kansas operators would view a larger pattern as more credible
A small pilot may give anomalously negative or positive results while a larger pattern offers more diversity and more subpatterns to observe
Potential well or production problems in a small pilot may give negative results and could potentially preclude the opportunity for an expanded pattern
A larger pattern offers a greater margin of error if an individual producer well problem develops
We propose the following general plan for the project:
The Kansas CO2 Team proposes to DOE to investigate, and if viable, perform a larger flood – the exact configuration of this flood will be resolved as data are obtained from remediated wells and issues are resolved about reservoir performance under flooding
We request the DOE provide a 45% match for major Budget Period 2 activities or reallocation of BP2 activities into BP1 including ethanol plant CO2 capture activities
We will submit a proposal within 6 months to DOE to perform an Arbuckle demonstration project the size of which will be determined in the design and which will involve Kinder-Morgan support
We are requesting that Kinder-Morgan provide CO2 only for a portion of the LKC demonstration – costs for the remainder of the pattern will be born by Murfin, ICM, and DOE