SpaceX enters business of drilling for natural gas
Capitalism in space: SpaceX has decided to enter the natural gas energy business to help fuel its rockets, and is presently in a legal dispute with another natural gas drilling company over rights to drill on a piece of property near its Boca Chica Starship facility.
SpaceX intends to drill wells close to the company’s Boca Chica launchpad, it was revealed during a Friday hearing before the Railroad Commission of Texas, the state’s energy regulator.
Production has yet to start because of a legal dispute between the SpaceX subsidiary Lone Star Mineral Development and another energy company. Tim George, an attorney representing Lone Star, said at the hearing that SpaceX plans to use the methane it extracts from the ground “in connection with their rocket facility operations.”
While it’s unclear what exactly the gas would be used for, SpaceX plans to utilize super-chilled liquid methane and liquid oxygen as fuel for its Raptor engines.
Since methane is the main component of natural gas, I suspect SpaceX hopes to utilize the gas it pumps out to fuel its Starship & Super Heavy rockets. By obtaining the gas from its own wells, SpaceX cuts out any middle men, and has the opportunity to reduce its costs as well.
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Capitalism in space: SpaceX has decided to enter the natural gas energy business to help fuel its rockets, and is presently in a legal dispute with another natural gas drilling company over rights to drill on a piece of property near its Boca Chica Starship facility.
SpaceX intends to drill wells close to the company’s Boca Chica launchpad, it was revealed during a Friday hearing before the Railroad Commission of Texas, the state’s energy regulator.
Production has yet to start because of a legal dispute between the SpaceX subsidiary Lone Star Mineral Development and another energy company. Tim George, an attorney representing Lone Star, said at the hearing that SpaceX plans to use the methane it extracts from the ground “in connection with their rocket facility operations.”
While it’s unclear what exactly the gas would be used for, SpaceX plans to utilize super-chilled liquid methane and liquid oxygen as fuel for its Raptor engines.
Since methane is the main component of natural gas, I suspect SpaceX hopes to utilize the gas it pumps out to fuel its Starship & Super Heavy rockets. By obtaining the gas from its own wells, SpaceX cuts out any middle men, and has the opportunity to reduce its costs as well.
Readers!
Please consider supporting my work here at Behind the Black. Your support allows me the freedom and ability to analyze objectively the ongoing renaissance in space, as well as the cultural changes -- for good or ill -- that are happening across America. Fourteen years ago I wrote that SLS and Orion were a bad ideas, a waste of money, would be years behind schedule, and better replaced by commercial private enterprise. Only now does it appear that Washington might finally recognize this reality.
In 2020 when the world panicked over COVID I wrote that the panic was unnecessary, that the virus was apparently simply a variation of the flu, that masks were not simply pointless but if worn incorrectly were a health threat, that the lockdowns were a disaster and did nothing to stop the spread of COVID. Only in the past year have some of our so-called experts in the health field have begun to recognize these facts.
Your help allows me to do this kind of intelligent analysis. I take no advertising or sponsors, so my reporting isn't influenced by donations by established space or drug companies. Instead, I rely entirely on donations and subscriptions from my readers, which gives me the freedom to write what I think, unencumbered by outside influences.
You can support me either by giving a one-time contribution or a regular subscription. There are four ways of doing so:
1. Zelle: This is the only internet method that charges no fees. All you have to do is use the Zelle link at your internet bank and give my name and email address (zimmerman at nasw dot org). What you donate is what I get.
2. Patreon: Go to my website there and pick one of five monthly subscription amounts, or by making a one-time donation.
3. A Paypal Donation or subscription:
4. Donate by check, payable to Robert Zimmerman and mailed to
Behind The Black
c/o Robert Zimmerman
P.O.Box 1262
Cortaro, AZ 85652
You can also support me by buying one of my books, as noted in the boxes interspersed throughout the webpage or shown in the menu above.
Reminds me of Henry Ford (early on)
Delta airlines bought their own refinery, IIRC
Additionally, SpaceX will gain more knowledge regarding the usage and processing of methane and doubtlessly develop new technologies in this area. These will be crucial elements needed for creating methane on Mars for fueling of their Starships.
Jburn gets it right. Frankly, it’s not cheaper to extract, purify and store these gases oneself than paying someone who does it all day everyday unless a high demand, low supply market develops. The value is learning to do it in different ways so as to improve the efficiency of the fuel, storage, etc. needed for off world work.
how does the amount of fuel used by the flight of a Falcon 9 compare to that of a 747 transatlantic flight? My guess is less.
… just looked it up. The Falcon 9 weighs 549,000Kkg The 747-8 weighs 440,000kg.
Asking because I worry that rocket launches are using a lot of fuel. But that does not make sense in that there are 100,000 airline flights each day in the world.
I find it interesting how SpaceX bucks the general trend of all companies to ‘outsource’. I wonder how much of that is due to their first launch loss due to a supplier-made strut that broke at less than maximum load.
So they want the natural gas at their site and they are buying drill rigs as well. So will these rigs serve double duty being launch pads and looking for natural gas? Or have one rig for launches and the second rig at a distance piping over the fuel? SpaceX is becoming more and more self-sufficient.
I can kinda see it, inasmuch as it would:
a) teach them more about handling methane, and allow them to develop and test the connections, hoses, tanks, and other infrastructure that on Mars would be connected to the Sabatier plant, and
b) would give them maximum flexibility in when and where their methane is sourced from–no risk of mis-matched schedules (e.g., having to wait for gas on order, or buying gas and then not needing it for a few days because of hardware or weather delays, and having to find a place to store the purchased gas, which is incredibly expensive compared to tapping it fresh out of a well)
The first part makes complete sense to me. The second part, sort of. However, what doesn’t make sense to me is the cost-savings argument, since pretty much all methane on the market is dirt-cheap thanks to the fact that methane comes out of oil wells naturally and is required by law to be captured and sold on the market–or flared, which you can only do for so long before the government starts fining you. So, right now, there is not really any money to be saved by drilling dedicated gas wells, when oil wells (especially in Texas) are producing more gas than the market can bear.
UNLESS… unless Elon suspects that fracking on private land is going to get shut down, which would instantly drive oil, natural gas, and electricity prices through the roof (along with everything made using oil, natural gas, and electricity–which is pretty much everything, indeed). In that case, he’s probably getting desperate to get off of this rock before the global economy crashes.
Steve: Most of the propellant mass is actually the LOX, not the fuel. LOX can be made using air (or water) and electricity.
Does anyone know where SpaceX is getting their Boca Chica LOX from? Are they making it on-site, or showing any evidence that they are planning to do so?
If Elon is serious about building a Mars colony, he needs to be getting serious right now about all of non-rocket-related stuff that the colony is going to need that isn’t available off-the-shelf. As much as he might wish otherwise, the market is not going to react quickly enough to keep up with his timeline–it takes months or even years to make a business case, put together an engineering team, complete R&D and tooling, and get something to market for Elon to buy, and few companies are willing to gamble that kind of money today in the hope that Elon will be buying their goods in a few years.
Jay: I don’t expect so. Offshore drilling for natural gas has largely dried up as a result of the glut of natural gas coming from the fracked oil wells in the shale plays. It makes no economic sense to go offshore unless fracking on private land gets banned, in which case the natural gas market suddenly turns the clock back to 2006 again (when the US was expecting to have to start importing LNG from abroad at ruinous prices). Also, the methods of operation of a gas rig and a rocket platform don’t really mesh well, especially in the early years of a rocket platform’s operation. I expect that when Phobos and Deimos do go to sea, they’ll be back and forth a lot for at least the first few years due to SpaceX’s iterative R&D style.
A.Nonymous,
You are correct, I know we have become an exporter and not an importer of fuel due to fracking. I did not know the offshore drilling has dried up because of it.
To answer your earlier question, SpaceX in Boca Chica gets their LOX from the company Air Liquide. Over at KSC, NASA and SpaceX gets it from Praxair and Air Liquide.
I agree that SpaceX does this to learn extraction more about handling methane on Mars. Just like hyperloop was all about learning engineering in near vacuum. Everything Elon Musk does is a preparation for his retirement there, he does nothing else. Electric machines, batteries, solar power, big drills, com sats. AI implants is less central but might also be useful for his Martian sci fi vision. Oh yeah and launchers and crewed aircrafts too. This guy is serious!
Can anyone predict what the next industry will be that he gets into, given what more he needs on Mars? Robotic greenhouse farming that he once started all of this with?
Surface Mars is a very harsh environment; not at all suitable for human habitation. What little atmosphere is left there is CO2, not of much use except for the above mentioned greenhouse farming. Without a magnetosphere to shield radiation, any practical habitation will be sub-surface, or at least have a sizeable quantity of mineral material piled on top for shielding. And there’s your ulterior motive for the hyperloop venture: drilling, boring, and trying to get that equipment and technology to Mars in the first place.
His next projects will be in electric powered heavy construction equipment and earth movers.
The ground must be prepped before permanent buildings can go up.
After the first construction buildings go up the tunnel boring machines can be made operational and after that everything can begin to move underground.
Water extraction
Cement and concrete production.
Well, I have actually read the various filings, and yes there is a legal dispute. But it has nothing to do with drilling for natural gas. The Bloomberg reporter is confused about what is going on (gosh, imagine that).
This is all about ownership of a 24-acre parcel of land. SpaceX has been attempting to buy up all the land around their facilities at Boca Chica, and this parcel is very close by. So, SpaceX bought it.
However, owning the surface rights does not mean you own the subsurface mineral rights. There are two unused wells on the property: one is a saltwater disposal well, and the other is a gas well which last produced in 2014. The current operator of these wells, Dallas Petroleum Group (DPG), claims that they own the pertinent mineral rights, and furthermore that they also own the land itself. It’s a pretty tenuous claim (in my opinion) but Texas courts will rule on that.
Nobody really cares about ownership of the mineral rights and operating rights of these (abandoned) wells. It’s all about the surface land, which has value only because SpaceX is nearby.
So actually there is no prospect for natural gas production at Boca Chica.
Steve-
Thanks for actually reading the Filing’s, — you have any links handy?
Elon wants to drill for CH4 gas because “he Can”. (What’s the point of living in Texas without having your own oil well in the backyard?) if they’re already is an abandoned gas well there, so much better. (thanks Steve)
Besides, his first ships landing on Mars will need a drill rig made for space flight that he prototypes in Texas. Drilling for gas it’s just a cover story. :-}
What really confusing is bowing down before the climate clowns with this “hundred million dollar carbon capture award”. I suppose he wants or needs to play their game or he could be shut down with an executive order.
https://mobile.twitter.com/elonmusk/status/1352392678177034242
Does it need to work better than trees? Or should it be able to remove all carbon from the air so the planet dies? Or just be affective enough in a low air pressure environment… (Mars) to extract oxygen and carbon in large amounts for breathing and insulation.
I wonder if anyone realizes that with more carbon dioxide in the air, the more the plants will grow, absorbing co2 until equilibrium is reached between plant growth and available carbon.
The planet will soon be lush with overgrowth in places never having anything growing before. No human assistance required.
Speaking of Elon musk’s brother. 7min. Shipping container farming in Brooklyn.
https://m.youtube.com/watch?v=VxRNoSSkLkE&noapp=1
He also does a Ted talk. With his cowboy hat.
Dell computers is combining technology with vertical farming. Yes, farming mostly done by robots.
https://www.delltechnologies.com/en-us/perspectives/podcasts-trailblazers-s02-e13-htm-agriculture-vestical-farms/
This is what I picture the farms on Mars and the moon to look like underground if they have enough power.
wayne, here you go.
The nice thing about the oil&gas industry (or as they say in Texas, the “awl bidness”) is that most everything you want to know is available online. If you know where to look.
Start with the Texas Railroad Commission (RRC) website https://www.rrc.state.tx.us
Follow the “RRC CASES” link to https://www.rrc.state.tx.us/hearings/rrc-cases/
and then click “Find a Case”. Search for the SpaceX company name “Lone Star Mineral Developement”
and you’ll find two case numbers 00004359 and 00004376, one for each well in question.
Click these links to get a list of the couple dozen documents in the docket.
Start with reading the oldest file, from Aug 21, 2020
04-264705 Lone Star P4.pdf
04-262265 Lone Star P4.pdf
Lone Star (which is SpaceX) says these wells were operated by Dallas Petroleum Group (DPG), however due to lack of production the leases have terminated. The leases are now owned by Lone Star, and they are requesting to be designated the operator of the wells in question.
DPG disputes this. Now read DPG’s “Motion to Dismiss” document from Jan 5, 2021.
Oh this is a good one! DPG basically says “Hey RRC, we are in litigation with Lone Star about this well, so please dismiss this docket. Oh, and we plan to repurpose this well as a commercial disposal well. See, we are still using the well.”
The best part of this document are the Exhibits:
Exhibit A is a lawyer letter from Lone Star to DPG listing all the bad things DPG has done.
Exhibit B is a bill of sale showing DPG’s purchase of the mineral lease in 2017.
Exhibit C is fascinating. This is a copy of the complaint filed by DPG in Texas District Court. They are suing Sanchez Oil & Gas (SOG), the previous owner of the lease, who sold the lease to DPG in 2017. The suit essentially claims “Hey, when we bought the mineral lease, you were supposed to sell us the land also. You promised you would! And we just noticed the land wasn’t listed on the Bill of Sale! Better late than never. Convey the land to us.”
Exhibit D is from Dogleg Park (SpaceX), intervening as a third party in this lawsuit between DPG and SOG. Dogleg Park says “We bought this land from SOG in 2020. DPG is making a baseless claim.” This Exhibit D is the best recitation of what’s really going on.
For more fun, play with the RRC GIS viewer: https://rrc.state.tx.us/resource-center/research/gis-viewer/
Enter the API numbers of each well in the search box and you can see where they are located: 06130526, 06130530
From the GIS, or from the filings above, we know the district and lease numbers for the two wells:
district / lease no
04 / 264705
04 / 262265
Using that info, you can look up the production history for each well here: http://webapps.rrc.texas.gov/PDQ/home.do
Use the “Specific Lease Query” button. These are gas wells.
Steve–
Great stuff! You outdid yourself on that one!
I always wondered about the fate of the Texas Railroad Commission after oil was deregulated.
Steve Richter,
Thanks for your question and research. It looks like a Falcon 9 launch to space does not use much more fuel (not including O2) than one or two trans-Pacific 747 flights.
Come to think of it, a lot of energy (fuel) is needed in order to make that liquid oxygen.