http:oilgas'nd'gov 600 East Boulevard Ave' Dept 405 Bismarck, ND 585050840 701 3288020

1
http//oilgas.nd.gov600 East Boulevard Ave. -
Dept 405Bismarck, ND 58505-0840(701) 328-8020
2

• A tough old cowboy told Ole that the secret to
  long life was to sprinkle a little gunpowder on
  his oatmeal every morning. Ole did this every
  day and sure enough lived to the ripe old age of
  93. When he died he left behind 14 children, 28
  grand children, 35 great grandchildren and a 15
  foot hole in the wall of the crematorium.

3
North Dakota CO2 EOR Potential

• Evaluation of all currently unitized North Dakota
  reservoirs indicates the following
• 35 reservoirs have adequate reservoir pressure
  with a primary / secondary recovery method and
  response that indicates potential CO2 EOR
  success.
• Combined these 35 reservoirs have an OOIP and CO2
  potential approximately equal to 1.2 Weyburn
  units.
• Total CO2 required for EOR in the 35 reservoirs
  is estimated at 2.79 TCF.

4
(No Transcript)
5
Analysis of CO2 Potential for Three North Dakota
Waterfloods

• North Dakota CO2 EOR projects breakeven
  economically at 20-24/barrel (25-30 WTI).
• North Dakota operators anticipate CO2
  requirements of 10 MCF per incremental barrel.
• North Dakota reservoirs present substantial
  geological, mechanical, and oil price risk.
• Electricity is a significant portion of operating
  costs.
• Capital investment of 3-6 per incremental barrel
  is needed to implement CO2 projects.
• North Dakota private mineral ownership doesnt
  provide opportunity for royalty holiday
  incentives used in Canada.

6
(No Transcript)
7
(No Transcript)
8
(No Transcript)
9
Possible Solutions

• CO2 utilization studies could demonstrate to
  operators that requirements and therefore cost
  will be less.
• CO2 utility could share risk by trading CO2 for a
  share of incremental oil or tying CO2 cost to oil
  price.
• Utilities could market CO2 and electricity
  together via long term contracts at lower
  electrical rates for CO2 users.
• CO2 utilities or government could provide a share
  of capital investment into projects or provide
  CO2 credits.
• North Dakota could provide additional tax
  incentives such as sales tax exemptions or
  increased extraction tax reductions.