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Energy World;NEWLN:Amoco taking gamble with carbon dioxide recovery

By MEDE NIX

DENVER CITY, Texas -- Amoco Production Co. is going ahead with its enhanced oil recovery projects at two West Texas sites in the hope that oil prices will go higher in the long-term.

By building plants to inject carbon monoxide into underground oil reserves, Amoco spokesman Greg Clock said the company is taking the long-term outlook that prices will rise.

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'People are asking why we are doing this in an extended down-time period,' Clock said, 'but in these two cases, we began injecting the carbon dioxide in tests in late 1984, and we determined we would need two plants to get the oil and natural gas. It made more sense to continue than to just shut down.

'We won't reap the benefits for a few years,' he said. 'It's kind of ironic that we've got these going during extremely down times.'

The Amoco Corp. subsidiary is building a carbon dioxide plant four miles northeast of Denver City, and a plant in operation since July 1985 in Sundown is being expanded, Clock said.

The Denver City plant employs about 450 construction workers and is to be completed by the end of July. A similar number are to be employed at Sundown, with completion of that project expected by January 1988, Clock said.

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Despite the multi-billion dollar cost of the plants, Clock said that they are good investments because of the certainty that the oil is there. There will not be any dry holes and companies can be certain of increasing their recoverable reserves with the projects.

'These fields, the Wasson Field near Denver City and the Slaughter Field near Sundown, are in the third stage of recovery. They were both discovered in 1936, and in the 1960s, we went to water injection as a secondary recovery method. Now we're on the third level, carbon dioxide.

'We've been testing tertiary recovery in labs for years and had a small pilot project in Tulsa. We built our first plant at Sundown in July 1985,' he said.

He said the primary and secondary methods usually yield only 30 percent to 50 percent of the oil in place. With the carbon dioxide, the fields should be producing well into the 21st century, he said.

Both plants will be fully computerized, with operators able to oversee operations by looking at graphic displays.

Clock also said the carbon dioxide recovery process is as safe as or safer than any other oilfield operations.

The potential health hazards associated with carbon dioxide are limited and exist only with an exposure to a high concentration of the gas. Clock said any large release of carbon dioxide into the air from either of the plants is unlikely.

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The Denver City plant will be capable of producing 80 million cubic feet daily of natural gas and carbon dioxide combined. The Sundown plant can produce 100 million cubic feet and will be expanded to produce an additional 65 million.

Denver City and Yoakum County have claimed the title, 'Carbon Dioxide Capital of the World' because of the plants. Arco, Shell Oil Co. and Exxon Corp. also have plants in the area.

Clock said that the carbon dioxide process is fairly new and confined to the West Texas region near Denver City and some fields in Wyoming.

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