Coal Front

Is coalbed methane Alberta’s next energy boon, or another environmental boondoggle?

By Hanneke Brooymans

For centuries, coal miners toiled in dim, claustrophobic tunnels in the grip of a constant fear. Coal dust mingled on their bodies with the cold sweat brought on by an invisible enemy. They called it “fire damp” and thought it was unleashed by demons haunting the mine depths. It could seep silently out of coal seams or hiss suddenly out of a fissure. The results were literally explosive. Fire damp is methane, essentially natural gas. It’s colourless and odourless. Down in the tunnels, when it came into contact with the flame of a miner’s bobbing headlamp or his clenched candle, the accumulated gas would explode. A small cloud could knock a miner flat.

Large pools killed hundreds in coal mines around the world, including Alberta, leaving mangled, barely identifiable bodies for weeping widows to identify. Often the force of the explosion would shoot bodies from the mouths of mine shafts like bullets.

These deadly accidents don’t seem to have any link to Woodlands County, a bucolic north-central Alberta community which prides itself on its fur trade roots and its serene wilderness. But fire damp, known today as coalbed methane, is still capable of sparking apprehension along the quiet back roads among farmers and landowners whose hands may have cleared acres of forest but have never been blackened by coal dust.

Like the youngest, neglected sister in a fairytale, coalbed methane was long shunned and ignored in favour of its more glittering and better behaved siblings—conventional oil, natural gas and the oilsands, which have consistently produced riches for Alberta for decades. Coalbed methane is formed through a process called “coalification,” which converts plant matter into coal over millions of years. Instead of being trapped in the pore spaces of rock, like most conventional natural gas, coalbed methane is attached to the coal itself. Pressure from the overlying rock or any water in the coal seam keeps the methane in place. Producers can coax the methane out only by reducing the pressure. Sometimes this means fracturing the coal seams. Most times it means pumping the water out of the seams. Almost always, it requires more work than conventional natural gas does, so it’s easy to understand why it was shunned.

Coalbed methane was looked at in the late 1980s and early ’90s, but gas prices were low and pipelines were chock full of conventional natural gas. Now the situation has changed dramatically. Natural gas prices are high—high enough to force rebates from the provincial government—and conventional natural gas supplies are petering out. The Alberta Energy and Utilities Board reports that gas production peaked in 2001 and has dropped over the last two years, despite a furious rate of activity that saw a new gas well drilled nearly every hour last year. The province is under pressure to continue its high production rate. Ninety-four per cent of all gas Americans import comes from Canada, and their appetite increases annually. A group of Alberta industry and government geoscientists, the Canadian Gas Potential Committee, says it doubts Canada will be able to meet domestic and U.S. demand beyond 2014 with current resources. We need to “aggressively pursue” other supplies of gas, including coalbed methane, to give us time to cut back on gas use and develop energy alternatives, the committee says.

The Alberta Geological Survey estimated recently that Alberta’s coal seams, which sweep the entire province all the way up to Grande Prairie and in a sloping line across to Lloydminster, hold 500 trillion cubic feet of methane, though the survey did not hazard a guess as to how much of that could be pumped out at a profit. A cubic foot of natural gas is about the same as the volume of air required to fill a basketball. One trillion cubic feet is enough to fuel most of Canada’s gas-heated homes for two years.

Even one-tenth of the estimated supply of coalbed methane would out- strip remaining conventional natural gas supplies. It’s not surprising, then, that the oilpatch has thrown itself into pursuing this long-neglected resource with newfound enthusiasm. Provincial Energy Minister Murray Smith says it could be “the oilsands of natural gas.” In 2002, fewer than 50 coalbed methane wells were drilled in Alberta. This number has ballooned to about 1,000 and Smith predicts it will rise to 15,000 in the next few years.

In Woodlands County, coalbed methane development announced its arrival when a landman knocked on Irene and Floyd Olson’s door four kilometres northwest of Fort Assiniboine in 2001.

Sitting at her kitchen table, with a view of hulking bulls out one window and the suspense of farm cats watching chickadees out another, Irene recalls their first impressions of the landman’s proposal to have a coalbed methane well drilled on their land.

“I thought, ‘Oh, this will be all right. It will be one well, we’ll get a little money from it and maybe they won’t stay too long.’ Mm-mm, wrong,” the 60-year-old says with a rueful shake of her head. “Because now they tell us they’re applying to the Alberta Energy and Utilities Board to increase the number of wells per section.”

That’s typical of methane development. The gas is at a lower pressure than conventional gas, so more wells are required per section of land. Often as many as eight wells per section are needed. For farmers unaccustomed to oilpatch activity, this smacks of a waste of good land.

While Floyd, 64, rumbles a tractor through the farm yard, Irene extols the virtues of the area’s “grey wooded.” Grey wooded is a type of soil, though the way Irene savours the words you’d think it was a vintage of wine. Woodlands County is blessed with a thick layer of this type of soil. “When there’s moisture here, it’s really good land,” Irene says. “So farmers hate to lose acres of it to a gas well site. It’s galling for them to have to steer their tractors around a well pad.”

Irene also misses the lost tranquility of her farm. “I didn’t expect the development to be of this size,” she says. “That means the extra traffic on the road, the pipelines, the interruptions to our way of living and to our nice quiet corner.” She points outside to the pen containing their seven “rascal” bulls. “Before, the only things to disturb us would be our crazy bulls or our neighbour’s dog, which would come for a visit once in a while.” Now methane-related trucks regularly roar by on the road beside their farm.

Beyond the increased noise, the extra traffic kicks up clouds of dust. Irene and Floyd paid to have the road in front of their driveway oiled. The company working on her land oiled another 150-metre stretch of the road leading to her place. They did it without having to be asked.

“I thought, ‘Oh, this will be all right. It will be one well, we’ll get a little money from it and maybe they won’t stay too long.’ Mm-mm, wrong.” —Irene Olson

In fact, Irene has few harsh words to say about Trident, Nexen and Red Willow, the three companies digging wells in the county. They even tested her well water before and after they drilled the well closest to her house. “I was quite glad of it because we only have one well,” Irene says, “and for 250 head of cattle and two coffee drinkers it would have been stressful not to have water.”

Water can be a major problem.

An Alberta activist group called the Butte Action Committee brought in visitors from Wyoming and Colorado who told stories about lemonade that could be lit on fire and tap water that looked like milk and fizzed like Alka- Seltzer. Sounds like the work of a mad scientist, but the Americans said it’s caused when methane seeps into aquifers after drilling.

Some U.S. farmers were also astonished when drillers used a process called “fracing” to release methane from coal seams, turning the water from their adjacent wells black. And they say productive farm land turned into hardpan after gas companies flooded nearby land with water drained from coalbed methane wells. As is common here in Alberta, farmers in Wyoming and Colorado learned they didn’t own the rights to the minerals beneath their land. Soon the activities of energy-hungry companies in relatively regulation-free Wyoming turned a methane-rich area called the Powder River Basin into a powder keg.

Conservative ranchers found themselves suddenly relating to radical environmentalists as they watched their range land get chewed up by tightly spaced well pads, road networks and sprawling containment lagoons for up to 77,000 litres per day of wastewater from each well. A recent study found that half of the water pumped from wells finds its way into the basin’s streams and that it could lead to the elimination of 20 to 30 species from those streams. But ranchers are even more concerned about their livelihood. One rancher in Wyoming, the inspiration for the novel The Horse Whisperer, won an $800,000 (u.s.) lawsuit this year against a company that ran roughshod over his ranch.

The situation is similar in Colorado. “The road cuts wildlife habitat to ribbons,” state resident Mark Harvey wrote in the High Country News. “Extracting salty water from the deep aquifers and bringing it to the surface ruins good soils and clean sources of surface water. An area that was once a wild meadow or prairie now looks like an industrial park.”

In Alberta, years of drought have made farmers sensitive to these kinds of stories. But drought, coupled with the crushing mad cow crisis, has also opened up land to development. “We’re getting to the age where we’d like to cut down on the number of cattle, but there’s no place for them to go,” Irene says. The couple gets $1,200 per year for each well on their land. “Everyone assures me you can’t make that amount of money by farming that land,” she says, caught between financial and ecological concern.

While their hearts may tell them to hold out, the practical need for Alberta farmers to feed their families and hold on to land that may have been in their family for generations opens countless gates for gas compa- nies. Irene and Floyd were among the first in the area to profit from coalbed methane. “That’s when all the coffee shop gang started calling Floyd J.R. and Jed Clampett,” she says. They never expected five wells, though, with more to come. “I don’t think we had a choice, to tell you the truth. I think they were coming anyway.” Why put up with the noise, dust and traffic from the development on neighbouring farms and not get any of the profits yourself, she says. “But if I had my druthers, I’d rather they were in some other county.”

A tour around the block of Irene’s neighbourhood, so to speak, reveals coalbed methane activity at just about every crossroads. Down the road from her farm, sections of yellow pipe line up across a field in orderly single file, waiting to be tucked under the earth. At intervals on either side of the road, patches of scraped, raw earth are flanked by ramparts of topsoil. These are future well sites.

Irene stops her truck at an intersection and points out an orange backhoe scooping gravel out of a ridge that will be used at well sites. “Now this,” she says, shaking her head, “is ugly.”

The reaction is equally mixed that evening in a community hall in Tiger Lily, not far from the Olson farm. Farmers shuffle past posterboards set up on easels describing the coalbed methane process, then settle in around lacquered table tops, enjoying free coffee and squares.

Coalbed methane could be the oilsands of natural gas. In 2002, there were fewer than 50 wells in Alberta. Now it’s 1,000 and it could rise to 15,000 predicts Energy Minister Murray Smith.

About a dozen Nexen and Trident staff work the room, answering questions from the 40 or so people who show up. It’s not their first open house. The companies are taking pains to distance themselves from the stories imported from the u.s. “Alberta is not Wyoming,” one posterboard declares, listing the regulations companies must follow in Alberta. So far, Trident has sunk 60 wells and $30-million into the area and has yet to start commercial production, according to Dan Bartsch, a Trident production manager. “But that’s ok,” he says, “because as we’ve seen in basins in the U.S., it takes a long time to produce economic quantities of gas.”

The companies know that while they calculate how many wells they need and how productive the area is, it makes sense to keep the communities happy, to become part of the community. “We have open houses every six months to let them know what’s changing,” says Don Seely, a Trident drilling manager. They address rumours, answer questions and try to keep locals in the loop. Their message is that coalbed methane is a safe, lucrative business for the community.

Not all are convinced. “I’d just as soon they don’t come make a mess on my property,” says Marvin Kruschel, 72, peering skeptically at a posterboard. “It’s a nuisance to have to farm around those well pads.” For the most part, however, people at the meeting seem quite content with the companies. Richard Hillmer works for a business that cements the wells. Trident even demands they put tarps down on the land before they cement, he says. “Their expectations of contractors are way above other large companies,” he says. “The only negative comments we hear about it are from farmers living next door, and they say, ‘We’ll be happy when they put a well on my property.’”

Farmers further south are just as hungry for the money. MGV Energy Inc., a pioneer of the coalbed methane industry in Alberta, has been very busy in the Beiseker area, a town that boasts Squirt the skunk as its mascot and proclaims itself the cross- roads to the future.

The land here is almost entirely cleared and agricultural, but also had little drilling on it until recently. mgv now has 85 wells producing methane and another 20 wells in various stages of drilling. All the wells tap into what’s called the Horseshoe Canyon zone, one of six coal-bearing formations in the province that have methane potential. “For the most part, people were open to having wells drilled on their land,” says MGV’s 43-year-old operations manager Gord Robinson, while downing a bacon and egg sandwich at Beiseker’s Apple Pie Café.

“We have had to do a lot of talking to accommodate neighbours, but that’s ok,” adds Michael Gatens, 46, the MGV CEO who speaks with a slight southern drawl stemming from his West Virginia roots. Gatens is also chairman of the Canadian Society of Unconventional Gas, a group which formed in April 2002 to support the exploration and development of all kinds of unconventional gas resources, including coalbed methane.

Last year, the company held an open house to let people know they were applying to the AEUB to drill up to eight wells on each section of land. The negotiations with landowners have taken a year so far and are still ongoing. Landowners can get $2,500 per year per well. For someone who has eight wells on a section, that works out to $20,000 per year.

Despite the talk of coalbed methane’s heavy “footprint” on the land— that is, the amount of land taken up by roads and well pads—farmers will ignore options that could save precious farm land but cost them money. Directional drilling allows several wells to stretch out underground from a single pad. “Landowners will get snarky with us if we say we want to drill directionally,” Gatens says. Farmers are paid according to how much land is disturbed. The company will pay for two to three acres, even though the final well uses a much smaller space.

Gord Robinson drives his truck right up to a well. The pressure gauges are the highest point of the well at 120 centimetres. A small fence measuring six metres by six metres encloses the well. Robinson points out how it angles in—“because otherwise the cows like to rub against them.” Farmers are losing little land around the well, he says.

Noisy and busier, compressor stations are less comfortable to live beside than a regular well. But they’re a necessary part of the coalbed methane industry, because of the lower gas pressure. The MGV compressor station holds two large compressors, two backhoes, a black water storage tank, an office building, a dehydrator and large reels of black plastic pipe. If the company decides to develop eight wells per section, they will likely add one or two compressors to the site, Robinson says.

Each compressor roars like a small jet engine, despite its specially designed walls to absorb sound. In the u.s., compressor stations have liter- ally driven people insane with their noise, prompting one man to plug the machines with bullets. Not a scenario MGV wants to see here.

As always, though, it’s water that resurfaces as the number one issue in the Beiseker area. Michael Gatens’s father-in-law farms in the area. “The number one question he asks anyone who wants to drill on his land is, ‘Is it going to affect my water well?’” Gatens says.

If anyone could answer that question, it would probably be József Tóth. The desk in his University of Alberta office is covered in papers full of swirling blue arrows. They depict the underground flow of water in his native Hungary. Tóth calls it his retirement project. He’s already had an illustrious career, most recently winning an award from the National Ground Water Association for major contributions to the field of ground water science.

Part of Tóth’s contribution to Albertans was to map all of the province’s groundwater. Altogether, Tóth and his team at the Alberta Research Council produced 47 colourful maps crammed with details about the groundwater in each area. They show how much water could be pulled out of the ground in an area, if it was freshwater or saline water, what other elements it contained, what sort of geology it was found in and at least a dozen other details. Tóth’s long career has taught him that you can’t just assume how aquifers will react to changes in flows around them. A person would have to be armed with specific details of each site to figure out how a coalbed methane well would affect the aquifers in an area, he says. There is no generic answer to how a particular aquifer and other aquifers near it will react to being pumped. “There could be absolutely no effect,” says Tóth, “or there could be an immediate effect.”

Like an enormous trifle, the earth under our feet is divided into layers of water (aquifers) and layers and mixtures of rock, sand or shale (aquitards). These aquitards usually keep the layers of water, which can vary significantly in saltiness and other chemical characteristics, from mixing. But if you change the pressure under- neath, that could change, Tóth warns. “There is no such thing as an absolute seal between aquifers,” he says.

Even pumping salty water from great depths can affect the freshwater above it, depending on the types of rock between the two layers of water, the distance between the layers and the rate at which you are pumping, he says. “You’ve got to know your system before you start to manipulate it.”

The latest report from the Alberta Geological Survey agrees that we need to proceed with caution. The society did a few aquifer tests in the Alberta Plains region. “These tests suggest producing water from these aquifers initiates flow from the aquifers, flow across aquifer/aquitard boundaries and potentially flow from surface water bodies,” the report reads. “These connections became evident under relatively low flow conditions when compared to production rates that would be associated with coalbed methane development.”

Each compressor roars like a small jet engine, despite its specially designed walls to absorb sound. In the U.S., compressor stations have literally driven people insane.

These words of caution echo what has already been said by the Pembina Institute for Appropriate Development. An exhaustive report compiled primarily by Mary Griffiths, an institute policy analyst, suggested all major coalbed methane developments should undergo environmental impact assessments before they are allowed to proceed. The Pembina report predicts methane projects will gobble up more land than conventional natural gas because they need more wells. And the report suggests there could be problems with water, venting, flaring and noise pollution from compressors.

Griffiths says she still does not know exactly what percentage of wells drilled so far are producing freshwater because companies are granted a one-year data confidentiality period on experimental wells for competitive reasons. The Pembina’s report only served to increase the chorus of voices coming from rural Alberta demanding that government keep careful control of the companies working with methane. The ripples of concern, when combined, were enough to rock the provincial government into action.

Earlier this year, they announced a series of public consultations and set up working groups to come up with recommendations on water, air, tenure and royalty issues. In early spring, consultations were held in Pincher Creek, Strathmore, Stettler, Rocky Mountain House, Wetaskiwin and Barrhead, all areas where coalbed methane activity is expected or already underway.

The Canadian Association of Petroleum Producers has already published its view on its website. The association says the AEUB should speed up the approval process and be more critical about whether or not someone objecting to an application will really be affected by the project. They also want the government to figure out a way to allow freshwater produced in a coalbed methane project to be used rather than reinjected.

All of this contrasts with the cautious approach advocated by the Pembina Institute. When Energy Minister Murray Smith announced plans to study the regulations around coalbed methane, he said he wanted government and industry to “get it right.”

“We want to learn from the experiences of other regions,” he said, “and from the wells that have been drilled so far in Alberta, to promote responsible, sustainable development.”

There are communities full of rural Albertans who really hope he means what he says.

Hanneke Brooymans covers environmental issues for the Edmonton Journal.



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