Manually mining coal underground

Since last I wrote I have travelled to London and then up North into southern Scotland (I write this looking down at the station in Dumfries, having passed the one-time house of Scotland’s Bard). Today I would like to continue writing on some of the historic methods of mining coal, in part because, in certain parts of the world, this is still the way it is done.

Last time I had talked a little about how mining started where the coal seam came to the surface, or outcropped, and that miners worked their way into the hillside digging the coal out creating both a passage deeper into the seam, and also leaving some pillars, as they widened out the passage way to mine more of the coal. Other times, as the coal became deeper, instead of working from the outcrop, they would sink a small shaft, and mine coal out from around its walls. Because the mines thus had the narrow shaft and then widened in the coal seam they became known as bell pits. They were used in parts of Northumberland as late as World War 1. The miner would break out the coal with a pick, and hand load it into baskets, or corves, that would then, initially be carried up the ladder by children or women. However as the mine got deeper the ladder haulage would be replaced by a hand-turned winch, or later and for deeper mines, a horse gin or other winching system using an animal.

Picture of bell pit

Picture of horse gin
A two-horse gin is reported to have been able to raise some 2.5 tons of coal an hour.

As demand grew, so the underground mining pattern would grow with it. This may was from the Kehley’s Run Mine in Shenandoah, PA. The plan shows how, from the original drift into the side of the hill, the mine spread out along and behind the outcrop, leaving as small a pillar as possible to hold the roof up.

Partial plan of Kehley’s Run Colliery at the time of an underground fire in 1880. The red areas show roof falls. The cracked black are broken pillars, while solid black are pillars with some strength and integrity. (I have cleaned the image a little with Photoshop)

You can see in the illustration how the mine (the current entry is at M, the earlier entry having been closed by the roof collapse shown) mined as much coal as possible to leave the least amount of coal, and that this could cause roof falls. I mentioned one of the fires at the mine, but this mine also raised attention from one of the many riots that erupted between miners, mine owners and their security guards.

Some of these stories have been dramatized in movies such as the “Mollie Maguires”, but it was a grim and vicious set of confrontations based on grim working conditions. In one seven year period some 566 miners were killed and 1,665 were injured in Schuylkill County, PA alone.

Confrontation at the Kayley's Run colliery 1888 (after Popalis )

You might be able to get some sense of the grim conditions from the mine plan. Conditions had been worse in Europe. There are a number of nasty things that can happen in coal mines. As we recently saw and heard, one of them relates to the gas that is given off during mining. Like natural gas from other sources, in ranges from 5 – 15% this methane can be explosive and thus the levels of gas must be kept below this level (hopefully below 1%) if the miner is to be safe.

The other gas that had to be watched for was carbon dioxide, which in contrast with methane, which being lighter than air collects in the roof, is heavier and thus pools on the floor. So that if you were getting down to cut the starting slot in the bottom of the coal seam, you might just drop into a pool. It was called choke damp – though that was also the name given to carbon monoxide, which could also seep out of the coal. All these gases are colorless and odorless so that without some form of detection (the canary for example, or using a candle as a test) they can lurk to catch the unsuspecting. With the invention of the safety lamp (where the heat of the flame is removed by a surrounding mesh of copper wire) it became possible to use the lamp itself as a testing tool. One of my first mining tests was to make sure that I could tell, by the height and shape of the small blue flame of the methane burning over the lowered flame in the lamp, what the gas concentration was. (Each lamp was in a separate hood, and I remember that they had two at the same concentration in the set of around half-a-dozen I had to evaluate).

Methane caps on a safety lamp flame (Colliery Deputy’s Handbook)

When the miner saw the flame cone, he would first wave a shirt or towel to stir the methane into the air, hoping that the concentration would fall below 1%, but if the level built up, he might have to leave, or call for more drastic measures to get rid of it. Back in Medieval times there was an individual called The Penitent, who would wrap himself in wet rags and crawl into the mine with a candle on a long stick. Raising the candle to the roof, he would ignite the layers of methane that would gather there, before the rest of the miners came back into the working. Methane, being lighter than air would gather in the roof, when the air currents were not strong enough to mix it into the air and remove it.

The Penitent – an etching by Hildebrand

But, as they mined coal from further away from the shaft, the air would not easily move around the workings, and since the coal would give off other gasses, as well as methane, there needed to be some way of circulating the air. And so the miners began to run sets of tunnels out into the coal that ran parallel to one another, but with cross tunnels (cross-cuts) between them so that they could circulate air around and up to the working area.

For many years, starting in around 1810 the motive power for the air was created by having a fire in the bottom of the shaft, in a special furnace room. Usually these were underground, although there was the occasional one at the surface. Unfortunately if the fire ignited the surrounding timber that was being used for support, then a major fire could result, killing everyone underground. This was the case with the Avondale mine disaster in 1869, at the time the worst industrial accident in American history, 110 people died.

At first there was only one shaft or tunnel leading in and out of the workings, but a major accident occurred at New Hartley in Northumberland, UK in 1862 where the main beam for the dewatering pump fell into the shaft, blocking it. The 199 men and boys in the mine, virtually the entire working male population of the village, were all killed, It was a result of those deaths that legislation was passed that required that there be two separate ways to get out of a mine. Where the mine is deep underground this means that there are generally two shafts, or more from the workings to the surface. (My Dad was manager at the resurrected mine, and the village school was the first primary school that I went to).

Initially men broke the coal from the solid with picks. To mine more efficiently they would first swing the pick along the bottom edge of the coal, and cut a slot that would be perhaps a couple of feet deep. Then they would drive the pick into the cracks in the main seam section and break the coal to the edge that they had created. When they worked this efficiently, a man can be very effective in breaking out the coal (about 4 joules/cc specific energy, for those that are interested, The machines mine at around 1,000 joules/cc of coal removed).

As the working face grew away from the shaft, it became too slow to rely on women and children to carry the baskets, on their backs, to the shaft and up out of the mine. ( A woman was reported to be able to carry about 56 lb of coal at a time. So first rails were used to slide the baskets along. Then wheels were added, first to flats, and then to small tubs. At first these were of wood, but then were changed to metal.

Although there are still parts of the world where this type of primitive mining still occurs, and where women and children are used to help get the coal out, in most countries they have been banned from underground work. (This was the Act of 1842 in the United Kingdom) . Taking the coal from the miner or hewer to the shaft was known as putting or hurrying. (I learned it as putting).

Six year old girl:
"I have been down six weeks and make 10 to 14 rakes a day; I carry a full 56 lbs. of coal in a wooden bucket. I work with sister Jesse and mother. It is dark the time we go."

Jane Peacock Watson.
"I have wrought in the bowels of the earth 33 years. I have been married 23 years and had nine children, six are alive and three died of typhus a few years since. Have had two dead born. Horse-work ruins the women; it crushes their haunches, bends their ankles and makes them old women at 40. "

Maria Gooder
"I hurry for a man with my sister Anne who is going 18. He is good to us. I don't like being in the pit. I am tired and afraid. I go at 4:30 after having porridge for breakfast. I start hurrying at 5. We have dinner at noon. We have dry bread and nothing else. There is water in the pit but we don't sup it. "

With time horses (or pit ponies as they were called) were taken underground and used to haul the tubs. Ponies were used for haulage well into my working career, and leading one was the first underground job that I had, when I worked in the mines before going to college. They served two purposes, being used firstly to haul the coal from the face, but also to haul wood back to the working area, where the miner would cut the wooden props to length and then wedge them against the roof to hold it up while he worked under it.

Because of low cost, the tubs had very crude axles, and so, to go around a turn, one had first to stop the pony, then switch the points on the rail, then start the pony round the turn, then run back to the back end of the tub, and manually twist the tub so that the axles turned to align with the turn. Fail to do any one of those and the tub came off the rails, meaning you had to unload it, put it back on the rails, and then reload it – all the while with the pony standing there enjoying the break.

Because a man with a pick is, though efficient, quite slow, machines were developed where a large number of picks were set into a chain, rather like a large chain saw, and this was used to undercut the coal seam about a hundred years ago. Then holes were drilled into the coal above the slot, filled with a stick of dynamite, and the blast would break the coal into pieces, that the miner could load into tubs. Typically he might load some 20 tubs in a shift, and these were hauled out of the working area by one of the lads, who would then attach those from several of the faces, and pull the resulting train to the shaft using a pony.

He would put his “token” in the tub before he would fill it, and so, when the tub was emptied at the surface, he would be given credit for that coal, providing it did not have much stone in the pile.

Carbon Sequestration sites and their success

There are a number of questions on the ease with which carbon dioxide can be sequestered underground, and I alluded to some of them in yesterday’s post. That led me to a quick review of the status of the concept, and I thought I would pass on information from some of the papers that I looked at. Some of the different options that can be used for carbon dioxide injection underground are illustrated by a review of the Polish program.

Different options for carbon dioxide disposal underground.

Of these the use for enhancing oil recovery has, perhaps the longest history. Some sense of the work can, perhaps, be seen by looking at CO2 injection at the Cranfield site in Mississippi.


The site is in an oilfield that was discovered in 1943, and abandoned in 1966. Since that time, under the influence of a strong aquifer drive, it has returned to its original reservoir pressure. There is a layer of residual oil, under a gas cap..

Section through the Cranfield site

The site is actually a dome, folding in both directions, so that the residual oil forms a ring. It is a part of the Tuscaloosa Formation, which MIT has calculated should be able to retain some 10,000 million metric tons of CO2. Adjacent continuations in East Texas and the Gulf would add an additional 187,000 million tons of capacity. Validation of the performance of the test site would thus go a long way to answering some of the critics of the technology. Because of the limited volume of oil available, the project is also looking into injecting CO2 into the brine interval during the third phase of the program.

At Cranfield the CO2 has been injected continuously, starting in July 2008, at a rate of 500,000 tons per year. so that, as Professor Economides discussed, the injection pressure remains high. At present the analysis of the samples shows little change in the water chemistry as a result of the injection. Last November it became the fifth site in the world to store more than a million tons of CO2. Monitoring of the pressures as the third stage has begun, does show a pressure increase, although this may be injection rate sensitive.


Monitored pressures for Cranfield 3 (U of Texas)

A second site is being prepared in Alabama at the Citronelle oil field, near Mobile. Both carbon dioxide and water will be injected at that site, with the intent that the CO2 will allow an additional 15 to 20% increase in overall production from the field, before the site is left to sequester the CO2.

In the United States, CO2 injection has already helped recover nearly 1.5 billion barrels of oil from mature oil fields, yet the technology has not been deployed widely. It is estimated that nearly 400 billion barrels of oil still remain trapped in the ground. Funded through the D.O.E.'s Office of Fossil Energy, the primary goal of the Citronelle Plan is to demonstrate that remaining oil can be economically produced using CO2-EOR technology in untested areas of the United States, thereby reducing dependency on oil imports, providing domestic jobs, and preventing the release of CO2 into the atmosphere. . . . . . . When the 5-month injection is completed, incremental oil recovery is anticipated to be 60 percent greater than that of conventional secondary oil recovery by water flood. A recent study by Advanced Resources International of Arlington, Va., estimates that approximately 64 million additional barrels of oil could be recovered from the Citronelle Field by using this tertiary recovery method.

In the last Oil and Gas Journal survey (April 2008) they found 100 miscible ongoing CO2 projects and 5 immiscible ones, with enhanced oil production, at the beginning of 2008, running at 250,000 bd.
Costs for CO2 EOR have been given as $20.86 boe, divided out as follows:
* $3.68/boe for CO2.
* $5.72/boe for power and fuel.
* $3.34/boe for labor and overhead.
* $2.00/boe for equipment rental.
* $1.36/boe for chemicals.
* $3.05/boe for workovers.
* $1.71/boe for miscellaneous.

One of the Centers most active in the monitoring of CO2 plumes as they migrate from the wells out into the formation is at the University of Texas-Austin. Sue Hovorka, for example, monitored a CO2 plume migration after it was injected as part of a test in the Frio Blue sand, although in that test the injection was of the gas.

Several times a day during injection, trucks hauling 20-ton tanks of cold liquified CO2 arrive at the test site, where it is transferred to two 70-ton storage tanks. The CO2, which comes from a natural reservoir near a Mississippi salt dome, is transported most of the way by train.

During injection, the liquid CO2 is pumped through a heat exchanger, which warms it up to 21 degrees C (70 degrees F), converting it to a gas. Then it is pumped through the injection well head and a mile down the well. The CO2 enters the porous sandstone and brine through perforations in the well casing and spreads out in a plume.

She also described, briefly how the process was supposed to work.

Before the first tests, the scientists had predicted that an effect called residual saturation, caused by capillary forces, would cause the brine-filled pores in the stone to trap and hold about 20 percent CO2. The other 80 percent moves on to the next set of pores, and as it moves, it’s continuously diminished. In other words, the plume smears out. Hovorka said the effect is intuitive.

“It’s the same reason you can’t get grease off the stove,” she said. “You can’t wash it loose with water, you have to use soap.”

The 2004 test confirmed this prediction and now initial results from the 2006 test seem to reconfirm it. “It means we got the physics right,” said Hovorka. It also means she and her colleagues can predict the CO2-trapping ability of other sites before injection begins, a powerful and necessary tool for carbon sequestration to become a common practice.

Polish trials have looked at displacing natural gas with CO2 in a program that has been going on for over 12 years Part of the process at the Borzecin site was to inject the gas into the underlying aquifer beneath the natural gas pocket. The CO2 dissolves into the water and so the migration to the gas pocket occurs only very slowly, the gas is at 1,500 psi (just above the critical pressure) when it enters the reservoir). The gas displaces natural gas that had previously been dissolved in the aquifer, yielding about 60% of the injected volume of CO2, as natural gas from the production wells.

One event that this test showed, which perhaps Professor Economides had not considered is that the dissolved CO2 appears to have interacted with the water, over time, to form a carbonic acid, that ate into the carbonate rock, and increased the permeability of the formation, lowering the pressure required for injection, rather than, as he had anticipated, having it rise. The site has now accepted more than 1.4 million scm.

CO2 has also been tested as a means of displacing methane from unmined coal seams. The initial project was completed in 2005

During the project 203 tonnes of CO2 were supplied to the site and stored in tankers. The CO2 is taken from the tankers where it is already stored under pressure and then injected at the injection well (MS-3 well). The injection well was a new well drilled down to a depth of 1120m for the purpose of this pilot project. The target seams were thin coal layers that were bounded (above and below) by highly impermeable shales. The pre-existing coal bed methane (CBM) production well (MS-4) is 150m from the injection well. A tank by the production well stores the saline water which is a by-product. This is emptied and disposed of on a weekly basis. The produced gas (naturally - 97% methane, 2% CO2) is flared. Since December 2004 there has been a gradual rise in CO2 content of the produced gas, the latest figure is 8% which may represent breakthrough of injected CO2 at the production well.

Modeling of the process is not yet fully functional, and in contrast to the more conventional reservoirs for oil and natural gas, the large fracture patterns in coal, known as cleat, play a greater part in the performance of the coal beds and must be included in the analysis.

Nevertheless the tests of the different methods for storage, and use of CO2 injected into the ground have been successful. The most widely recognized, however, is that carried out by Statoil, with Sleipnir the most documented. By 2004 Sleipnir had been injecting CO2, which is produced at an unacceptable 9% in the natural gas extracted at the site, at a level of a million tons a year, since 1996. Because of the length of time that the injection had occurred it has been possible to map the migration of the CO2 over that time. The initial injection is at a depth of 1,000 m below sea level.


Pattern of CO2 injected flows from the injection well at Sleipnir after 3 years

If I read the plots correctly the injection point is aligned with the deepest point in the picture and the flow path is about 2 miles long on its greatest extent.

The site continues to be monitored, as injection continues, with migration being downward under the containment of the cap rock.

Seismic surveys of CO2 migration at Sleipnir

It is expected that the CO2 will slowly dissolve into the brine (over hundreds of years). The scale of the above is exaggerated vertically since the height of the plume is around 600 ft.

The success of the program has led to the Snohvit Project which again takes the CO2 from a natural gas supply (in this case at 5% CO2) and stores it underground.

The success of these projects, and the changes in conditions from the simple models initially assumed to the more complex considerations that have had to be undertaken as the storage has continued to accept high levels of CO2 in some cases, and only high injection rates in others, nevertheless combine to suggest that Professor Economides models may be overly conservative.

T6. More on early coal mining

In the last Tech Note I wrote about harvesting coal along the coast, and then the shallow workings that became the first underground mining, where tunnels were driven into the sides of the hills, within the coal seam. The miners would load the coal into baskets, or corves. These corves were woven by people in the village, it was one of the early jobs that George Stephenson (he of railway fame) had at the mine. And they were small enough that they could be carried by women. (The quote at the bottom of the post says that they carried 56 lb of coal). As greater production was needed, so the corves grew larger, and were placed on sleds that women and children could drag through the mine to either the outside, or, as the seam went deeper, to shafts. At the shaft the coal baskets would be raised to the surface using windlasses, which were turned either by people, or as more power was needed by horses or oxen. You can see a corve being lowered using a horse gin in this picture .

As the workings moved away from the shaft, a layout had to be created in which pillars of coal would be left to hold the roof up. At the same time there were two gases that became feared by the miners. At the time they were using candles that were attached to spikes that could be driven into the coal wall, or a wooden prop being used to hold the roof up. One of the gases that would desorb from the coal is methane. This is the natural gas that is now, in some locations collected by drilling long horizontal holes through the coal. It is an unconventional source of gas, and usually called Coal Bed Methane (CBM). While it will come out of a pipeline at a useable concentration, when it seems out of the coal within the mine it can become diffused through the air, and in a modern mine the air speed and volume are designed to dilute it, and carry it rapidly out of the mine. In earlier years, however, they did not have such fans. The air was almost still, and so the methane could rise and collect in pockets at the roof. Holding up a candle to see ahead a miner could ignite the gas, or if it was in a concentration of 5-15% by volume it could explode. When it explodes it can kill either through the force of the blast, or by burning up all the oxygen in the mine, suffocating those not initially killed.

At the start of a miner’s day they might therefore send someone in, wrapped in wet cloth, and crawling along the floor with a candle on a stick. At each high point in the roof he would raise the candle, hoping in this way to burn out the gas, before it reached the explosive level, and while the pockets of gas were small. The person doing this was given the title “The Penitent. ” The role was also present in salt mines faced with the same problem, and there is a photo of a Polish model, the old classic picture is a bit harder to find so I must dig out and add a version of my copy.

Keeping the air churned so that these pockets of what was called Fire Damp, or just plain damp, had to be done several times a shift, generally by waving an article of clothing, in the days before mine ventilation.

The other gas that had to be watched for was carbon dioxide, which in contrast with methane, which being lighter than air collects in the roof, is heavier and thus pools on the floor. So that if you were getting down to cut the starting slot in the bottom of the coal seam, you might just drop into a pool. It was called choke damp – though that was also the name given to carbon monoxide, which could also seep out of the coal. All these gases are colorless and odorless so that without some form of detection (the canary for example, or using a candle as a test) they can lurk to catch the unsuspecting. With the invention of the safety lamp (where the heat of the flame is removed by a surrounding mesh of copper wire) it became possible to use the lamp itself as a testing tool. One of my first mining tests was to make sure that I could tell, by the height and shape of the small blue flame of the methane burning over the lowered flame in the lamp, what the gas concentration was. (Each lamp was in a separate hood, and I remember that they had two at the same concentration in the set of around half-a-dozen I had to evaluate).

As the mines grew larger air had to be circulated through them, so that these gases would not build up, and a series of temporary and permanent walls would be built between pillars in worked out areas of the mine, to make sure that the air moved around the mine, and then back out the shaft. For many years, starting in around 1810 the motive power for the air was created by having a fire in the bottom of the shaft, in a special furnace room. Usually these were underground, although there was the occasional one at the surface. Unfortunately if the fire ignited the surrounding timber that was being used for support, then a major fire could result, killing everyone underground. This was the case with the Avondale mine disaster in 1869, at the time the worst industrial accident in American history, 110 people died.

Although there are still parts of the world where this type of primitive mining still occurs, and where women and children are used to help get the coal out, in most countries they have been banned from underground work. (This was the Act of 1842 in the United Kingdom) . Taking the coal from the miner or hewer to the shaft was known as putting or hurrying. (I learned it as putting).

Six year old girl:
"I have been down six weeks and make 10 to 14 rakes a day; I carry a full 56 lbs. of coal in a wooden bucket. I work with sister Jesse and mother. It is dark the time we go."

Jane Peacock Watson.
"I have wrought in the bowels of the earth 33 years. I have been married 23 years and had nine children, six are alive and three died of typhus a few years since. Have had two dead born. Horse-work ruins the women; it crushes their haunches, bends their ankles and makes them old women at 40. "

Maria Gooder
"I hurry for a man with my sister Anne who is going 18. He is good to us. I don't like being in the pit. I am tired and afraid. I go at 4:30 after having porridge for breakfast. I start hurrying at 5. We have dinner at noon. We have dry bread and nothing else. There is water in the pit but we don't sup it. "

So I will leave this segment just as the mine transitions from families working where the man hews coal from the face, loads the baskets, which are then dragged to the shaft by his wife and children and winched to the surface. Next time I will talk about the coming of the pit pony and mechanization and the changes that made. It increased the energy cost of mining the coal almost from the beginning, but that’s next time.

Earlier posts on coal mining are:

T1. Coal – its formation and structure

T3. Coal Reserves – or what can I count as real?

T5. Historic Coal Mining.

As I get time (and practice) I will also come back and illustrate these words with some pictures using Poser.

SEC Rules Changes for Oil & Gas Reserves

Yesterday I was talking about the calculation of reserves for coal mines, and the calculation of what a reserve holds is a critical part of raising the capital to put a mine in place. The same holds true about oil and gas wells, as their price rises above $5 million a well, and at the end of last year the SEC changed the rules on Oil and Gas Reserve Reporting. It is interesting to read the rationale for the changes. Part of the problem has been that the industry has been developing technologies that make it easier to economically extract oil from tar sands, and also to get natural gas from coal seams and from shales that had previously been uneconomical to develop. However, where the rules that define reserves do not allow a full accounting of the volumes that can be recovered, then it becomes harder to raise capital for the operation. The rules were last written in the time that most extraction came from the historic vertical wells that drilled down into a deposit and extracted the gas. With both coal and shale extraction the new technologies have advanced considerably beyond this, and to make the situation more realistic the rules had to be changed.

In the extraction of gas from shale beds, for example, the rock is normally made up of very fine grains, which provide very poor permeability (or passageways) for the gas to work through the rock to get to any well that is there. Rates of flow to the well would thus be too slow to be economic. To enhance the flow operators therefore drill long horizontal holes along the layer of rock holding the gas. Pressure in the well is then raised, until cracks are created in the wall of the well, and with more pressure these are extended out into the rock providing a path for the gas to flow back to the well. While this technique (of which more some future Sunday) creates passages through the rock that allow the gas to flow to the well in larger volumes, and makes the well potentially economically viable it has put artificial connections into the rock. Part of the old definition of reserves was that the oil/gas already had the connections in place in the rock to ensure that the fluid could flow to the well if it was drilled. Further the presence of oil had to be proved by drilling a well into the rock and actually showing that it was there. Thus the term “proved oil and gas reserves.”

To recognize that there are more sophisticated tools that can now tell much more about the presence of oil/gas in a rock without needing to drill that proving well, the SEC have changed the rules to read:

The proposed revisions to the definition of “proved oil and gas reserves” also included provisions for establishing levels of lowest known hydrocarbons and highest known oil through reliable technology other than well penetrations. We are adopting those revisions as proposed.

We also are adopting, as proposed, revisions that permit a company to claim proved reserves beyond those development spacing areas that are immediately adjacent to developed spacing areas if the company can establish with reasonable certainty that these reserves are economically producible. These revisions are designed to permit the use of alternative technologies to establish proved reserves in lieu of requiring companies to use specific tests. In addition, they establish a uniform standard of reasonable certainty that applies to all proved reserves, regardless of location or distance from producing wells.

Of course having written such a statement, one has to clarify what is meant by “high degree of certainty” (since there is no longer the physical evidence of oil on the end of the “dipstick”). This they have done by definition:

Therefore, we are adopting the “high degree of confidence” standard that exists in the PRMS. We also are clarifying that having a “high degree of confidence” means that a quantity is “much more likely to be achieved than not, and, as changes due to increased availability of geoscience (geological, geophysical, and geochemical), engineering, and economic data are made to estimated ultimate recovery (EUR) with time, reasonably certain EUR is much more likely to increase or remain constant than to decrease” to provide elaboration to the definition of reasonable certainty.

The other change that I want to highlight comes in the estimation, knowing that an existing site has oil/gas, as to how far out from that point the field can be considered to extend, and this is known as the “undeveloped reserve.” Here the decision is based on the degree of certainty that the field actually extends into that space. And the language has been loosened to make it easier to include those more distant reserves.

In the Proposing Release, we proposed a significantly revised definition of the term “proved undeveloped oil and gas reserves.”

The most significant aspect of the proposed revision was the replacement of the existing “certainty” test for areas beyond one offsetting drilling unit from a productive well with a “reasonable certainty” test. Currently, the definition of the term “proved undeveloped reserves” imposes a “reasonable certainty” standard for reserves in drilling units immediately adjacent to the drilling unit containing a producing well and a “certainty” standard for reserves in drilling units beyond the immediately adjacent drilling units.104 All commenters on this issue supported the proposal. Three commenters noted that a single standard—reasonable certainty—should apply to all proved reserves. We are adopting this aspect of the definition as proposed.

Since the companies no longer have to actually drill into a formation and prove the oil is there the old fashioned way, the big question transfers to the reliability of the technologies that are used to determine that oil is actually present. And here, since technologies continue to change, the words have been generalized

We also proposed to define the term “reliable technology,” expressed in probabilistic terms, as technology that has been proven empirically to lead to correct conclusions in 90% or more of its applications. Several commenters expressed concern that this proposed 90% threshold would be difficult to verify and support on an ongoing basis. We agree that a bright line test would be difficult to apply to a particular technology or mix of technologies to determine their reliability. Therefore, we are not adopting the 90% threshold as part of the definition.

And while changing the rules to include production from tar sands can be readily easily accomplished:

Our current definition of “oil and gas producing activities” explicitly excludes sources of oil and gas from “non-traditional” or “unconventional” sources, that is, sources that involve extraction by means other than “traditional” oil and gas wells. These other sources include bitumen extracted from oil sands, as well as oil and gas extracted from coal and shales, even though some of these resources are sometimes extracted through wells, as opposed to mining and surface processing. However, such sources are increasingly providing energy resources to the world due in part to advancements in extraction and processing technology. Therefore, the rules we adopt today revise the definition of “oil and gas producing activities” to include such activities.

However it does require a definition of bitumen, which they provide

We are defining the term “bitumen” as “petroleum in a solid or semi-solid state in natural deposits. In its natural state, it usually contains sulfur, metals, and other non- hydrocarbons. Bitumen has a viscosity greater than 10,000 centipoise measured at original temperature in the deposit and atmospheric pressure, on a gas free basis.”

And to address the point that I began with about accumulations of gas in unconventional places the regulations will change:

Although we agree conceptually that the focus of reserves disclosure should be on the final product, we also recognize that the production of oil and gas from varying sources can have significantly different economics. Extraction of oil and gas from continuous accumulations can be much more labor and resource intensive than extraction of oil and gas from traditional wells. They often require greater ongoing efforts and expense after the initial extraction equipment is in place, making such operations more sensitive to price fluctuations.

We agree with the commenters that disclosure based on the end product sold would provide a more effective basis for distinguishing reserves that disclosure based on the type of accumulation in which the reserves are held. Therefore, we have revised the disclosure to be based on the end product that is sold by the company However, with respect to the end product, new Item 1202 makes a distinction between oil and gas, on the one hand, and synthetic oil and gas, on the other. Synthetic products require processing of the raw resource material, either while it is still in the ground (“in situ”) or after it is extracted, before it can be used as refinery feedstock or as natural gas. Such processes currently include bitumen upgrading as well as coal liquefaction and gasification. However, resources from some continuous accumulations, such as coalbed methane, do not require such processing and therefore are not associated with the same level of ongoing costs once a well has been drilled because the in-ground resource is already oil or gas (in the case of coalbed methane, the in-ground resource is methane, trapped in a coalbed). Thus, coalbed methane would not be considered a synthetic product.

I think it is a fair comment to note that these relaxations of the rules will allow companies to claim significantly larger reserves, than heretofore allowed, although it should be born in mind that it actually won’t change the actual volumes of oil and gas in the ground by one molecule.