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Using an Alberta roadmap Oil shale researchers in the U.S. find hope on the long road to economic viability in the oil sands; shale pace also starts to build in Canada Gary Park For Petroleum News
Seldom has so much hype been showered on any aspect of the petroleum industry as the superlatives uttered about oil shale.
Take just a few.
The U.S. Department of Energy said total U.S. resources could translate into “as much as 2.2 trillion barrels of known kerogen oil in place,” with high-quality zones identified in Colorado, Utah and Wyoming that could yield 30 gallons per ton.
House Resources committee chairman in 2005, Richard Pombo, said just one-third of the richest oil shale deposits in the U.S. could produce 10 million barrels of oil per day and hold that level for more than 200 years.
A Shell Exploration and Production spokeswoman said the company was “confident,” although not “certain” that high-quality crude could be produced from the best shale deposits within a price band of US$25-$30 per barrel.
But, around the same time in 2005, the Rand Corp. said shale oil might only be economical at oil prices of US$75 per barrel.
And, for all the talk, commercial production still seems a distant dream. (See related story on the bottom of page 1.)
There may be wobbly progress Even so, there are quiet stirrings, some of them in Canada, that point to wobbly progress towards opening up the resource.
On the same day earlier in January, Royal Dutch Shell said it plans to apply an experimental upgrading technology on bitumen carbonates in the Grosmont formation of northeastern Alberta and Oilsands Quest formed a subsidiary to develop the technology needed to commercialize the company’s oil sands and oil shale assets.
Shell, through its SURE Northern Energy subsidiary, paid more than C$500 million almost two years ago to evaluate and potentially develop bitumen-bearing carbonates, testing proprietary technologies it is applying in Colorado oil shale and its in-situ upgrading in the Peace River oil sands of northwestern Alberta.
Over a long period, Shell has been experimenting with in-situ electric heaters to extract light oil from shale at its Mahogany Research Project in the Piceance basin of northwestern Colorado, where it hopes to decide early next decade whether to launch a commercial project.
For more than three years it has also been testing electric heaters in the Peace River area.
The pilot, due to last through 2008, has so far produced about 100,000 barrels of light oil, turning 8-10 degree API bitumen into 30-49 degree API oil, but the company is hesitant about proclaiming any success at this time, saying much more work is needed before a commercial application is possible.
Meanwhile, a regulatory application has been filed in Alberta for a pilot project to test electric heaters in the Grosmont formation, with construction to start about mid-2009.
Yildirim named president of Oilsands Quest Technology Oilsands Quest, in the forefront of efforts to extend oil sands development from Alberta into Saskatchewan, has named the highly regarded Erdal Yildirim as president of Oilsands Quest Technology.
Among other positions, he was co-founder and chairman of the National Oil Sands Task Force from 1993 to 1996 and is managing director of the Canadian Oil Sands Network for Research and Development.
“The progress in development of oil sands technologies has been a significant driver in the growth, prosperity and environmental sustainability of the oil sands industry,” Yildirim said.
“Yet it remains a relatively young industry where a new wave of technological advancements is occurring through improvements to existing technologies, commercialization of emerging technologies and creation of new technologies generated by novel process concepts.”
The new subsidiary is designed to operate on the leading edge of efforts to maximize value from the oil sands and oil shale. DOE acknowledges Canadian research In a U.S. Department of Energy report last summer there was acknowledgement of the role Canadian research can play in converting oil shale into a commercial product.
Three companies drawing on Alberta expertise were included on a list of 25 companies investigating the commercialization of oil shale, which hinges on overcoming the technological challenge of extracting oil from oil shale, which is actually kerogen, a solid organic matter that produces oil and gas.
Alabama-based Oil Shale Exploration Co. (an amalgamation of three companies) is running tests in Utah, using the Alberta Taciuk Process, which produced 1.5 million barrels of shale oil in Queensland, Australia, until the trial was shut down in mid-2004.
OSEC hopes to launch a pilot in Utah over the “next few years, shipping Utah shale oil to Alberta for testing at Taciuk pilot facilities. If successful, the equipment will be disassembled and shipped to Utah for research and development.
The Taciuk process has also been used to test samples from Anadarko Petroleum’s shale leases, which are spread over 8 million acres in Colorado, Wyoming and Utah.
In 2006, Anadarko shipped a 500-ton bulk sample to Calgary to be tested in the Taciuk processor. That program was reported to have succeeded and core analyses were due to have been completed by late 2007.
A Department of Energy spokesman said the development of Alberta’s oil sands into a viable economic resource over the past 30 years has driven home one message in the U.S. — “never, ever give up.”
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