Air Products to supply nitrogen to Nederlandse Aardolie Maatschappij for extracting gas from small fields

The supply of nitrogen will make it easier and more efficient to extract gas from depleted field

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Sep 28, 2012, 12:00 ET

ROTTERDAM, Netherlands, Sept. 28, 2012 /PRNewswire/ -- Today, Air Products announced it will build and operate a new air separation unit for Nederlandse Aardolie Maatschappij B.V. (NAM), a joint venture between Shell and Esso. The company has secured the necessary environmental and permit approvals and construction will start at the site shortly. The installation is expected to be onstream in summer 2013 and is located next to the De Wijk gas field near Hoogeveen in the province of Drenthe, The Netherlands.

The new unit will be built to supply nitrogen for the extraction of natural gas from small gas fields. The nitrogen, injected at high pressure, will make it easier and more efficient for NAM to extract the remaining 10% of gas from the depleted field.

The Netherlands and the Dutch part of the North Sea contain some 175 small oil and gas fields, some of which are almost depleted. In order to preserve the gas reserves in the field near Slochteren, the government has decided to prioritise the extraction of natural gas from small fields. To enable additional gas production from the depleted field, NAM has set up its own project under the name Aardgas+ (Natural gas +).

"Natural gas is normally extracted by being forced up by the natural pressure in the gas field itself. The more gas that is extracted, the lower the pressure in the gas field becomes and the more difficult it is to extract the rest. In general, the last ten percent in a field cannot be extracted economically," says Hans van Kempen, Head of NAM Onshore Projects. "It can be done, however, using new techniques. Injecting nitrogen at high pressure into the sandstone strata containing the gas increases the pressure in the field, and additional natural gas can be extracted more easily."

The first NAM gas field to use the technology is the De Wijk field near Hoogeveen in the province of Drenthe. Air Products is constructing an air separation plant, which will use a cryogenic process to extract nitrogen from the atmosphere, at the existing De Wijk-20 site close to the Hoogeveensche Vaart. The nitrogen will be purified and then brought to a pressure of up to 130 atmospheres using compressors. It will then be injected through various injection units into the gas field to a depth of up to 1500 metres.

The De Wijk gas field has been in production since 1954 and has so far yielded some 14.5 billion cubic metres of gas. Thanks to the new technology, it will be possible to extract the last 2 billion cubic metres in the next 10 to 15 years. This quantity is sufficient to supply all the households in Drenthe with natural gas for six years.

Air Products has secured the necessary environmental and permit approvals for the new installation. This follows extensive consultation, including information evenings, held with landowners, local authorities, local inhabitants and other interested parties.

Air Products and NAM have placed a lot of importance on the visual impact of the facility and subsequently conducted an investigation to ensure this was part of the final design. With a view to blending the plant into its surrounding environment, the air separation installation will sit below 20 metres in height instead of the standard 40 metres. The utilisation of tree planting will also reduce the installations external visibility.

"We are particularly proud of the collaboration with NAM," says Howard Castle-Smith, vice president Tonnage Gases Europe at Air Products. "We have wide experience of comparable projects in the oil industry and are happy that we can also apply our technology in the Netherlands, where we have existing nitrogen business supporting the LNG market. We have been working closely with NAM on developing a technical concept that will fit in seamlessly with the environment and will meet all requirements. Thanks to its modular construction, it will be possible to dismantle the installation when extraction from the field is completed and to reassemble it at another field."

EDITOR'S NOTE:

Air Products (NYSE: APD) provides atmospheric, process and specialty gases; performance materials; equipment; and technology. For over 70 years, the company has enabled customers to become more productive, energy efficient and sustainable. More than 20,000 employees in over 50 countries supply innovative solutions to the energy, environment and emerging markets. These include semiconductor materials, refinery hydrogen, coal gasification, natural gas liquefaction, and advanced coatings and adhesives. In fiscal 2011, Air Products had sales of approximately $10 billion. For more information, visit http://www.airproducts.com/.

Air Products has been supplying gases and equipment to the enhanced oil and natural gas recovery industry for nearly 50 years and has extensive experience in both nitrogen injection and nitrogen rejection. In 2008, Air Products commissioned a large nitrogen injection facility in Mexico for enhanced oil recovery with joint venture partner CryoInfra. The Mexico project was delivered on time and has exceeded the design performance criteria. Air Products also has broad natural gas processing experience through its nitrogen rejection units (NRUs), its liquefied natural gas heat exchanger business, and helium recovery interests around the world. Air Products, which commissioned its first NRU in 1962, is the world leader with its NRUs having processed the most nitrogen rich natural gas with both fixed and variable content nitrogen.

More information on Air Products' enhanced oil and natural gas recovery experience and capabilities is at our Enhanced Oil and Natural Gas Recovery web site.

NOTE: This release may contain forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's reasonable expectations and assumptions as of the date of this release regarding important risk factors. Actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors not anticipated by management, including risk factors described in the Company's Form 10K for its fiscal year ended September 30, 2011.

SOURCE Air Products