Chevron Tests Propane to Extract O&G from Colorado Shale Wells



(Dow Jones Newswires), Nov. 22, 2011

Chevron said Tuesday it has tested propane as an agent for hydraulic fracturing of various shale gas wells in Colorado, a move that could potentially reduce the large amounts of water used to extract oil and natural gas.

"This fall, Chevron tested the use of liquefied petroleum gas (LPG) as a fracturing agent in five natural gas wells in its Piceance Basin
development in northwestern Colorado," Chevron spokesman Russell Johnson said in an email. "We are now evaluating the test results to determine the potential usefulness of the technique."

Chevron's test comes at a time when hydraulic fracturing--a technique also known as "fracking"--has come under scrutiny from environmentalists and others who fear it poses a threat to public health through groundwater contamination and air pollution. It also
uses massive quantities of water, a concern in many Southwestern states currently affected by drought. Finding an alternative for water
in the fracking process could be key for Chevron and other oil companies that have recently acquired large land positions in shale formations across the U.S. and Canada.

Fracking involves the high-pressure injection of water, sand and chemicals into a shale seam, causing the rock to shatter and releasing
oil and natural gas. In propane fracking, water is replaced by a liquid propane gel that is pumped into the shale rock wells under extreme pressure.

Once the propane is used as a fracking agent it turns into a gas that leaves the well with the produced natural gas. Unlike water, propane
doesn't carry drilling chemicals back to the surface.

But the new waterless fracking method is still in its infancy, and its cost is higher than hydraulic fracturing, according to analysts.

Also, propane is flammable, and requires special equipment to reduce the risk of explosion, experts say.

Copyright (c) 2011 Dow Jones & Company, Inc.



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