Energy Expo in Rifle talks oil shale

Technology advancements could make resource a viable energy option

Click to Enlarge Browse and Buy Post Independent Photos Colorado Mountain College’s Process Technology Coordinator Jon Prater (right) and student Karen England (left) get a kick out of a high school student who attempts to weld in the virtual world with the college’s newest piece of learning hardware at the 2008 EnCana Energy Expo. Courtesy of EnCana

By Phillip Yates
Glenwood Springs, CO Colorado
May 1, 2008

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RIFLE, Colorado — Three companies working on experimental oil shale extraction technologies in the Piceance Basin revealed some of their plans for developing the resource during an energy expo Wednesday.

Shell Exploration and Production, Chevron and AMSO LLC — companies that have five Bureau of Land Management oil shale research and development leases in the area — all had booths at the sixth annual Energy Expo held at the Garfield County Fairgrounds in Rifle.

The companies’ exhibits were among 90 booths manned by energy companies,
regulatory agencies and other groups at the Wednesday expo, which was presented
by EnCana Oil & Gas (USA).

“We really tried to bring together a variety (of exhibitors) so people can ask questions
and get answers,” said Kathy Friesen, education advisor for EnCana, about the
energy expo.

Shell, Chevron and AMSO’s details about their oil shale research development
projects comes as the BLM continues to work on its draft programmatic
environmental impact statement (PEIS) about possible oil shale leasing in the
Western United States.

That statement envisions three different scenarios for possible oil shale leasing in
Colorado. One would be a no-action alternative, another would open 359,798 acres
in the state, while a third would designate 40,325 acres to possible oil shale leasing.
It is the BLM’s preferred alternative to open the greatest amount of lands to possible
oil shale leasing.

Jim Koffer, a field deployment engineer with Chevron, said the company’s “in-situ”
process involves using carbon dioxide to pull the hydrocarbon in the shale out of the
ground. He said the company is returning to “square one” for its oil shale extraction
research, and is looking for ways to develop the resource in a “less energy intensive
process.”

“If it can’t be done in an environmentally sound way, we are not going to do it,” Koffer
said.

Chevron has one 160-acre lease in Rio Blanco County near Piceance Creek, and
the company is putting in environmental monitoring systems to assess the water level
and water chemistry in the area.

Koffer said Chevron is looking to take a measured approach to its oil shale
development process. He estimated that it could be 10 to 15 years before its
technology may be proven commercially feasible.

Shell has three of the BLM’s 160-acre experimental leases and is also working on an
“in-situ” extraction process, where the company would lower electrical heaters into
the rock formation and heat it to 650 to 700 degrees over a period of three to four
years, said Tracy Boyd, communications and sustainability manager for Shell
Exploration and Production.

When the oil shale gets to a suitable temperature, the hydrocarbon material — called
kerogen — becomes a vapor, Boyd said. When it is pulled to the surface, it cools and
condenses to produce a liquid that is two-thirds oil and one-third natural gas, he said.

As the company develops its oil shale process, it is also developing a “freeze-wall”
technology that is intended to build a frozen wall that protects the surrounding
water-bearing formation from the hydrocarbon during the oil shale conversion
process, Boyd said.

A decision to possibly implement commercial production of oil shale probably will
come in the middle of the next decade, Boyd said.

AMSO has the other experimental oil shale lease. The company’s strategy is to
produce shale oil and gas from the oil shale formation “2,000 feet below the surface
in order to prevent contamination of drinking water aquifers.”

The company is expected to initiate test drilling and completion, along with
conducting environmental and hydrology studies this year, according to information
provided by the company at the Wednesday expo. Further modeling and testing will
occur next year.

“Upon approval, commercial operations employing these techniques would start
sometime in the 2015 to 2020 time frame,” according to the company’s information.
“Production could expand to the 100,000 barrel a day rate over the course of several
years given favorable economics and acceptable impacts.”

Contact Phillip Yates: 384-9117pyates@postindependent.com




Post Independent, Glenwood Springs, Colorado CO