Economics of Coalbed Methane Reservoirs Versus Gas Reservoirs

This project seeks to use certain economic parameters to determine the feasibility of producing from coal bed methane reserves as against production from conventional gas reservoir. Coal bed methane gas refers to an unconventional type of gas that has very large reserves globally alongside shale gas, some heavy oils and tight sand gas but is very difficult to recover. Even if possible to recover poses a lot of risk which makes it very expensive to produce. In this project, an introduction is made of what coal bed methane is as compared to conventional gas reservoir, the geology of formation, their storage mechanisms, methods of production, and environmental impacts from producing one field as compared to the other. Also, economic evaluation of data from both fields in the North American average is made using certain basic economic parameters to ascertain the capital expenditure that goes into the production of both fields and the economic returns or profits both fields bring. The economic parameters used are Maximum Capital Outlay, Terminal Cash Surplus, Net and Cumulative Cash Flow, Profit to Investment Ratio, Internal Rate of Return and Net Profit Value.