Northern Michigan company implements new technology to produce oil
OTSEGO CO.-- Traverse City oil company, Core Energy, has begun implementing CO2 Enhanced Oil Recovery in Otsego County.
The technology uses Carbon Dioxide to extract oil from fields that were otherwise depleted.
Core Energy's President and CEO Bob Mannes says the process is expected to not only benefit the local economy, but also help the environment.
"We are taking CO2 that would otherwise be vented into the atmosphere and we are injecting the CO2 a mile underground into an oil field," said Mannes.
Specifically, the 840-acre oil field in Bagley Township just south of Gaylord, where they began the process in December.
"This is a big deal economically for the families here in Otsego County it's going to keep people employed," said State Representative Triston Cole.
The field was done producing oil through conventional drilling until Core Energy added it to the eight other oil fields in northern Michigan they're using CO2 Enhanced Oil Recovery to extract oil from.
"At the pressure and temperature of this reservoir, this type of oil becomes immiscible to CO2," said Mannes. "The CO2 turns to liquid and it mixes with the oil which will change the viscosity, allow the oil to flow to the reservoir easier."
"This is not fracking; this is beneficial to the environment and it's great economically and impacts the entire state," Cole said. "This is a win-win win across-the-board, it's very exciting."
The field has produced more than 3 million barrels of oil since the 1970's and Core Energy hopes to get 1 million more through the oil recovery technology.
"The CO2 stays in the ground after the oil is produced so this project will reduce the amount of carbon dioxide being emitted into the atmosphere," said Mannes.
Core Energy gets its CO2 from a gas processing plant called the Antrim Shale Gas Wells.
"The economic ripple impact from a single oil well is enormous in a geographical area," said Cole. "Anywhere from truck drivers to restaurants to maintenance facilities, you name it, it really runs across the gamut of things you wouldn't necessarily think about that're are also tied to the economic activity of an oil well."
Representative Cole says royalty payments from the field in Bagley Township will go to landowners who have mineral rights.
The Natural Resources Trust Fund will also receive payments because the State of Michigan has mineral rights for the field as well.
The oil will eventually go to one of three different refineries in Ohio, Canada and Detroit via pipeline five.