Oman’s knack for pioneering enhanced oil recovery (EOR) is already well known, but the Miraah solar thermal project offers solutions to a myriad of challenges facing the region’s energy producers.
The $600 million Miraah project in southern Oman will deliver the largest peak energy output – 1,021 megawatts – of any solar plant in the world by harnessing the sun’s energy to produce steam that can be injected into an oil reservoir. Heating the oil makes extraction of viscous crude, also known as heavy oil, considerably easier and cheaper. Miraah, which will span three-square kilometres upon completion, will use concentrated sunlight to generate 6,000 tonnes of solar steam per day. The project is spearheaded by state-owned and Shell-led Petroleum Development Oman (PDO) which accounts for 70 percent of Oman’s oil output and GlassPoint Solar. Construction on the first of the 36 glasshouses that make up the project began last October with the first steam on track for 2017.
The oil glut’s impact
Economic and energy efficiency is particularly coveted this year by Oman and the wider Gulf’s energy centered treasuries, as a glut of oil has depressed prices by nearly 70 percent since June 2014 to around $30/bl this year. Oman’s 2016 budget outlines a 33 percent reduction in oil and gas revenues, to 6.15 billion Omani Rial ($16 billion) – an ominous outlook for the Sultanate that typically relies on the sectors for over three quarters of its revenues. In 2014, Oman’s State General Reserve Fund (SGRF) led a $53 million investment in GlassPoint along with Shell and others to ramp up the deployment of solar EOR and the potential benefits stretch far outside the Sultanate’s borders.
“Miraah is just the beginning,” Rod MacGregor, GlassPoint’s president and chief executive explains. “The scale we are able to achieve with solar powered oilfields will help drive down costs of solar energy and accelerate a virtuous cost cycle. As costs decline, new solar applications and markets will open up around the Gulf and elsewhere.”
Ambitions are high as the size of the mega project is more than one hundred times larger than the pilot project built by GlassPoint for PDO in 2012. But such scale is necessary as Raoul Restucci, PDO’s managing director sees solar EOR as a strategic and long-term solution that will help safeguard Oman’s precious gas supply.
Miraah – ‘mirror’ in Arabic – is set to save over 5.6 trillion Btus of natural gas from being burned at PDO’s Amal oil field in southern Oman every year. Such savings could provide electricity for 200,000 people. Oman currently uses over 20 percent of its gas to support its maturing oil fields, with a significant chunk allocated to EOR. Solar EOR means that gas could be used to boost Oman’s LNG exports and support the country’s stretched budget, or funnelled into industrial projects to meet Oman’s economic diversification goals under its Vision 2020.
Slashing emissions and preserving water are both incorporated into the Miraah project, which could provide a local test case for Saudi Arabia and Kuwait. Such features are especially relevant following Oman and the Middle East’s show of public support to tackle emissions at the global climate change talks in Paris last December. Miraah’s automated washing system can recapture 90 percent of used water, which illustrates how solar EOR projects can help ease the rising pressure on the region’s water-food-energy nexus and costly desalination projects. Oman alone obtains 85 percent of its fresh water from the sea. Miraah will also reduce CO2 emissions by over 300,000 tonnes a year – similar to removing 63,000 cars from the Sultanate’s roads.
Oman’s technological innovations were borne of a need to cushion its budget against turbulent oil prices and dwindling reserves. Oman has pledged to produce 10 percent of its total electricity requirement from renewable energy sources by 2020. Comparatively, Abu Dhabi is targeting 7 percent, with Kuwait and Bahrain aiming for 5 percent within the same period.
Solar-powered EOR is the latest trick in PDO’s increasingly thick playbook, which includes steam, polymer and miscible gas injections. Plans to have EOR projects account for 33 percent of production by 2025 are on track. PDO is testing, reviewing and piloting over seventy technologies at any one time.
With oil prices at a 12-year low of around $30/bl, Oman’s energy sector urgently needs more technological innovations like Miraah to stem the growing losses from its coffers.
Sorce: MIT Technology Review
Photo: MIT Technology Review