Shale industry scales back potential in region — The Grand Junction Daily Sentinel #ColoradoRiver

August 3, 2014

From The Grand Junction Daily Sentinel (Gary Harmon):

An oil shale industry in Colorado, Utah and Wyoming is likely to be about one-third the size it had been envisioned, an industry association said. Instead of a 1.5-million barrel-per-day industry, the more likely scenario is a 500,000-barrel-per-day industry, according to estimates by the National Oil Shale Association. The estimates were dramatically reduced “in light of a more pragmatic view of what an industry might look like in 50 years or so,” the association said, in an estimate that also noted that oil shale production would demand less water than had been previously believed.

The United States in 2013 consumed 6.89 billion barrels of petroleum products or 18.89 million barrels per day, according to the U.S. Energy Information Administration.

The oil shale association’s estimate is based on production of 225,000 barrels per day from in-situ means, or heating shale deep below the surface; 200,000 barrels per day from retorting shale on the surface; and 75,000 barrels per day from modified techniques, such as heating it in an earthen capsule, which is left in place.

Additional information about water demands of each technique sharply lowered the association’s estimate of water use from its 2013 estimate of 1.7 barrels of water per barrel of oil. Depending on approach, production from oil shale could require between 0.7 barrels of water per barrel of oil to 1.2 barrels of water per barrel of oil. Production of 500,000 barrels per day could demand between 16,400 acre feet to 28,900 acre feet of water per year…

The reduction in the anticipated size of an oil shale industry is the result of new information that came to light this year, the association said.

“Projects have matured, and some developers have taken a new look into technologies that dramatically reduce water needs,” the association said. “However, estimates are still preliminary and may change as projects reach commercialization.”

More oil shale coverage here and here.


Water Lines: Colorado needs a better water plan — Jim Pokrandt #ColoradoRiver #COWaterPlan

July 16, 2014


From the Glenwood Springs Post Independent (Jim Pokrandt):

It’s almost time for football training camps, so here’s a gridiron analogy for Colorado River water policy watchers: Western Colorado is defending two end zones. One is the Colorado River. The other is agriculture. The West Slope team has to make a big defensive play. If water planning errs on the side of overdeveloping the Colorado River, the river loses, the West Slope economy loses and West Slope agriculture could be on the way out.

This is how the Colorado River Basin Roundtable is viewing its contribution to the Colorado Water Plan ordered up by Gov. John Hickenlooper. A draft plan will be submitted this December and a final plan in December 2015. The Roundtable is assessing local water supply needs and environmental concerns for inclusion into the plan and there is plenty of work to consider in the region. But the big play may very well be the keeping of powerful forces from scoring on our two goal lines.

Here’s why: Colorado’s population is slated to double by 2050. Most of it will be on the Front Range, but our region is growing too. Mother Nature is not making any new water. We still depend on the same hydrological cycle that goes back to Day 1. So where is the “new” water going to come from? Right now, there seems to be two top targets, the Colorado River and agriculture (where 85 percent of state water use lies in irrigated fields). Colorado needs a better plan.

The Colorado Basin Roundtable represents Mesa, Garfield, Summit, Eagle, Grand and Pitkin counties. This region already sends between 450,000 and 600,000 acre feet of water annually across the Continental Divide through transmountain diversions (TMDs) to support the Front Range and the Arkansas River Basin.

That water is 100 percent gone. There are no return flows, such as there are with West Slope water users. On top of that, this region could see another 140,000 acre feet go east. A number of Roundtable constituents have long-standing or prospective agreements with Front Range interests wrapped around smaller TMDs. Existing infrastructure can still take some more water. That’s the scorecard right now. We assert another big TMD threatens streamflows and thus the recreational and agricultural economies that define Western Colorado, not to mention the environment.

In the bigger picture, the Colorado River Compact of 1922 requires Colorado to bypass about 70 percent of the river system to the state line to comply with legal limits on depletions so six other states can have their legal share of the water. Failure to do so, by overdeveloping the river, threatens compact curtailments and chaos nobody wants to see. For one thing, that kind of bad water planning could result in a rush to buy or condemn West Slope agricultural water rights.

The Roundtable has heard these concerns loudly and clearly from its own members across the six counties as well as from citizens who have given voice to our section of the water plan, known as the Basin Implementation Plan (BIP). A draft of the BIP can be viewed and comments offered by going online to http://coloradobip.sgm‐inc.com/. It is under the “Resources” tab.

Jim Pokrandt is Colorado Basin Roundtable Chair.

More Colorado Water Plan coverage here.


Climate change: “The fossil-fuel industry…has been able to delay effective action” — Bill McKibben

July 15, 2014

Inylchek Glacier Kyrgyzstan

Inylchek Glacier Kyrgyzstan


Here’s an essay about the risk of doing nothing about climate change from Allen Best writing for The Mountain Town News. Click through and read the whole thing. Here’s an excerpt:

Bill McKibben, a writer and activist, has made the most cogent arguments. Two years ago, after crunching the numbers, he concluded that private companies own five times more carbon in the ground than the world can possibly absorb. “On current trajectories, the industry will burn it, and governments will make only small whimpering noises about changing the speed at which it happens,” he wrote in an essay titled “A Call to Arms” that was published in the June 8 issue of Rolling Stone.

He identifies a clear problem. “The fossil-fuel industry, by virtue of being perhaps the richest enterprise in human history, has been able to delay effective action, almost to the point where it’s too late,” he wrote. [ed. emphasis mine]

McKibben’s 350.org has been fighting the Keystone XL pipeline, which would export Alberta’s bitumen to refineries along the Gulf Coast. It’s largely a symbolic fight, as Michael Levi points out in his book The Power Surge. The tar/oil sands would, if fully developed, elevate atmospheric concentrations of C02 by 60 ppm. At current rates of tar/oil sands mining, that would take 3,000 years, he says. Isolating the climate debate to Alberta’s bitumen, he says, is a mistake.

But Keystone XL represents business as usual. We need accelerated change. The United States should follow the lead of British Columbia in levying a carbon tax. My impression of B.C.’s tax is that it not precisely the best model. We need a revenue-neutral tax, accelerating over time, giving the private sector clear market signals to instigate changes.

Henry Paulson, the former treasury secretary in the Bush years, made this case in an 1,800-word essay in the New York Times on June 22. A few days later, a group that includes Paulson, former New York City Mayor Michael Bloomberg, Stanford’s George Schultz, who is another former treasury secretary, and a number of other high-profile individuals — including billionaire Tom Steyer — released a report titled “The Economic Risks of Climate Change in the United States.”

More climate change coverage here and here.


“Oil shale has been the next big thing in Colorado for over a hundred years” — Ed Quillen #ColoradoRiver

April 26, 2014
Map of oil shale and tar sands in Colorado, Utah and Wyoming -- via the BLM

Map of oil shale and tar sands in Colorado, Utah and Wyoming — via the BLM

From The Grand Junction Daily Sentinel (Gary Harmon):

Microwaving rock in northwest Colorado could turn the oil shale business inside out, said a Grand Junction inventor who is working to restart oil shale at a time when many are pulling away from it. Using equipment small enough to be loaded onto two trucks traversing the surface could result in minimal surface disturbance, said Peter Kearl, a Grand Valley native who heads Qmast LLC, http://www.qmast.com, the company pursuing the project.

Not only would his technology disturb little of the surface, it also would likely produce — rather than use — water, Kearl said.

It could be run using natural gas from the Piceance Basin itself as a fuel source and leave behind subterranean caverns that could be used for carbon sequestration, Kearl said.

Most approaches to developing oil shale, from retorting it above the ground to mining and in-situ heating in large expanses, have run afoul of environmental and cost concerns.

Rather than employing a “big-risk, big-reward” approach such as that of Royal Dutch Shell before it pulled out of oil shale entirely last year, Kearl said he’s hoping to use a more measured approach and achieve more reliable and regular results.

Several other oil shale ventures are pushing ahead in Utah, and Kearl acknowledged that it might be easier to test his technology across the state line.

“But I’m a Colorado boy,” he said, voicing his preference for developing oil shale in the Centennial State.

He has a geology degree from what was known then as Mesa College and a degree in hydrogeology from the University of Nevada.

It also helps that the richest, though deepest, deposits of the Green River Formation’s oil shale are in the northwest corner of Colorado. Colorado, Utah and Wyoming contain the world’s largest deposits of oil shale that contain as many as 4.2 trillion barrels of oil, according to recent estimates.

Applying microwaves to heat-
targeted areas of rock makes more sense than heating large areas using other methods of heating, Kearl said.

“The fundamental physics are definitely on our side,” he said.

The process would send the microwave equipment down a well to heat the hydrocarbon-bearing rock to the point that it would release crude oil that then could be collected by conventional drilling, he said.

The technology could tap shale on steep slopes from the side, allowing the oil to simply flow out, he said.

He presented his idea in 2012 at the SLAC National Accelerator Laboratory on the Stanford University campus.

The more targeted approach he advocates could prove to be a financial success, Kearl said.

A well 300 meters deep could produce revenue of $80 million, based on $100-per-barrel crude prices, he said.

Kearl and his partners are working to arrange financing of $5.5 million for a test. That step is difficult because the federal government appears to be uninterested in making available any more land for research, demonstration and development leases.

The effective ban on experimentation “thwarts inventiveness,” Kearl said.

So he’s also looking for a small parcel of land, a quarter of an acre would do, on which to test his technology, including his estimate that he could produce about half a barrel of water for each barrel of oil he produces.

The patented microwave technology he’s considering wouldn’t require a large electricity supply, he said, because the process also would produce natural gas, which could be used to fire the generators for the microwave equipment.

Read the post with Ed’s quote here.

More oil shale coverage here and here.


ExxonMobil and Natural Soda Holdings, Inc. to research oil shale development #ColoradoRiver

March 11, 2014
Colony Oil Shale Project Exxon -- Photo / Associated Pres

Colony Oil Shale Project Exxon — Photo / Associated Pres

From The Grand Junction Daily Sentinel (Dennis Webb):

ExxonMobil and Natural Soda Holdings Inc. have edged another step closer to undertaking oil shale research-and-development projects with the Bureau of Land Management’s approval of their development plans. The approvals are for the company’s research, demonstration and development leases on federal land southwest of Meeker in Rio Blanco County. The projects still must undergo review by the Colorado Division of Reclamation, Mining, and Safety.

For ExxonMobil, its project marks a renewed attempt to commercially extract petroleum from oil shale after what was then Exxon shut down its Colony Project in 1982. That shutdown resulted in some 2,000 workers losing their jobs and caused economic repercussions for years from Glenwood Springs to Grand Junction.

Natural Soda, meanwhile, has extensive experience with another kind of mining at a site just north of its federal lease. It injects hot water underground to solution-mine for baking soda, known as nahcolite in its natural form. On its lease, it proposes first removing the nahcolite using its normal process, then producing oil from underground by heating it using either a downhole burner or a closed-loop steam system.

ExxonMobil also is proposing an in-situ, or in-place, development project involving heating the oil shale underground and then pumping out the oil — a process different from the Colony Project, which involved surface mining and heating of oil shale. Exxon wants to hydraulically fracture the oil shale, fill the fractures with conductive material and then electrically heat the shale.

The companies acquired the leases under a second round of R&D leasing conducted by the BLM. The leases initially cover about 160 acres but potentially can be enlarged by some 480 acres for commercial development if certain conditions are met.

Shell, Chevron and American Shale Oil hold R&D leases in Rio Blanco County from the earlier round of leasing — including three leases in Shell’s case — with the potential to convert each lease to nearly eight square miles for commercial development. But while AMSO continues to work on an in-situ project, Chevron, and more recently Shell, have ended their oil shale projects in connection with their leases. Shell had done the most work of any company on an in-situ shale project in Colorado before shutting it down last year.

Economics, environment

In approval documents for the ExxonMobil and Natural Soda plans, BLM White River Field Office manager Kent Walter wrote that each proposed action “with mitigation represents an opportunity to develop domestic energy sources and to inform and advance knowledge of commercially viable production, development and recovery technologies of oil shale resources consistent with sound environmental management. It also will provide a basis for informed future decisions about whether and when to move forward with commercial scale development and allow for the assessment of its impacts on the environment.”

David Abelson, an oil shale policy advisor for the Western Resource Advocates conservation group, said that if history is any indication, there’s a strong likelihood the latest projects won’t prove economically viable.

But he added, “One thing I think we have learned over the years is to proceed cautiously so we don’t repeat what happened in western Colorado in the early ‘80s.”

He said both Shell and Chevron showed a big difference from companies’ past practice in acknowledging failure early on rather than proceeding to the point where shutting down a project is economically devastating.

New approach

He said ExxonMobil and Natural Soda also will operate under a framework governing the second round of leases that requires more reporting regarding protection of air and water quality and other concerns.

“And that is good public policy. That’s the basis for making smart decisions,” he said.

ExxonMobil repeatedly has emphasized the desire to take a prudent, step-by-step approach to its new oil shale undertaking, something reiterated in its development plan.

“It is recognized that development of a commercial(ly) viable in situ oil shale technology will require a paced approach to thoroughly evaluate and optimize technology viability, with appropriate focus on environmental protection, water conservation and responsible land use,” the company said in the plan.

It plans to first conduct an appraisal phase involving drilling one or more test wells to ascertain the oil shale resources within the lease, along with groundwater monitoring wells to do baseline testing of water quality before further work ensues.

It currently estimates a resource of 600 million barrels of oil are contained in the shale within its lease.

The appraisal phase would be followed by three experimental phases, first to establish the ability to install the technology in the test zone, secondly to heat the zone, and then to do a pilot test to determine commercial viability on a field scale.

“ExxonMobil has consistently proposed a staged and deliberate development program that allows for technical advancement while minimizing the potential for environmental impacts,” its plan says.

Natural Soda also is outlining a phased approach in its plan, starting with a monitoring well to be drilled as soon as this year. That would be followed by steps such as building processing facilities, installing heating elements, operating the facilities and expanding and replicating the process over a period of up to nine years.

More oil shale coverage here and here.


Oil shale: An alliance of conservationists are asking Utah to reconsider recent permits for groundwater disposal

January 25, 2014
Deep injection well

Deep injection well

From The Grand Junction Daily Sentinel (Dennis Webb):

Conservation groups are asking the state of Utah to reconsider its December approval of a groundwater discharge permit for Red Leaf Resources’ oil shale project.

The request comes as the company hopes to begin mining shale this spring for a commercial demonstration project in the Bookcliffs about 55 miles south of Vernal.

The groups on Tuesday filed what’s called a “request for agency action” with the Utah Department of Environmental Quality and the department’s Division of Water Quality. It seeks review and remand of the division’s December decision and an order revoking the permit.

Attorney Rob Dubuc of Western Resource Advocates filed the action on behalf of Living Rivers, the Grand Canyon Trust, the Southern Utah Wilderness Alliance, Great Old Broads for Wilderness and the Sierra Club.

In a news release, the groups said the permit “lacks measures to prevent or detect surface or groundwater pollution, in violation of state law.”

Shelley Silbert, executive director with Great Old Broads for Wilderness, said in the release, “Amazingly, they are not even requiring monitoring of springs, seeps, or groundwater on site.”

Spokespersons for the Department of Environmental Quality and Red Leaf Resources could not be reached for comment Wednesday. In a December news release, the department said that “leachate produced from mining operations appears to have levels of dissolved contaminants that are comparable to, or less than, the levels in existing groundwater in underlying rocks.”

It also said rock just below the project area “is of very low permeability and protects underlying aquifers from any contaminants that could possibly be released from the capsule.”

Red Leaf Resources plans to try out what it calls a capsule approach in which it will excavate shale from a pit, install heaters and collection pipes, replace the shale and heat it to produce oil. The groundwater permit applies to a test capsule, and if the company wants to build additional ones for commercial production it would have to seek a major modification to the permit.

The conservation groups’ challenge of the permit says a planned 3-foot-thick liner made of up shale mixed with clay is inadequate. It says the Division of Water Quality determined groundwater just beneath the mine site doesn’t quality for protection because it is not usable, but in fact the division is required to protect all groundwater from contamination.

Meanwhile, a British Company, The Oil Mining Co (TOMCO), is moving ahead with plans to implement Red Leaf’s kerogen recovery process just west of the Colorado Border. Here’s a report from Gary Harmon writing for The Grand Junction Daily Sentinel:

A British company filed papers in Utah to begin mining oil shale on land just west of the Colorado state line. TomCo submitted a notice of intent to begin mining on 2,919 acres in Uintah County for shale, which it plans to roast in large earthen capsules to release oil.

Red Leaf Resources, which owns the technology that TomCo plans to use, last month received a groundwater discharge permit for its operation, and TomCo said it is working to obtain a similar permit for its leases, which are on state property.

TomCo, which is an acronym for The Oil Mining Co., anticipates tapping the leases for 126 million barrels of oil on what is known as the Holliday Block lease. TomCo licensed the Red Leaf technology, in which oil shale is excavated and the pit is lined with a network of pipes. The crushed shale is then replaced into the pit and covered over, then heated by the network of pipes beneath, to the point at which the oil breaks free of the surrounding rock and is collected with another network of pipes. Once the oil has been recovered, the material is left in place beneath its covering.

The EcoShale In-Capsule Process is expected to produce up to 9,800 barrels of oil per day on TomCo’s leases.

TomCo said it hoped the Utah Division of Oil Gas and Mining would approve the permit for mining in the middle of this year, and then open the matter for a 30-day comment period.

Red Leaf, meanwhile, expects to begin mining shale this spring for a commercial demonstration project the company hopes will allow it to tap as many as 600 million barrels of oil at the rate of 9,800 barrels per day.

Red Leaf Resources expects it to take a year to construct its first test capsule and that it will take into next year before oil will be recovered.

Red Leaf’s site is on Seep Ridge, about 15 miles southwest of the TomCo holdings.

More oil shale coverage here and here.


‘I firmly believe we will some day see oil shale become a reality’ — Glenn Vawter

December 9, 2013
Oil shale deposits Colorado, Wyoming and Utah

Oil shale deposits Colorado, Wyoming and Utah

Here’s a recap of a presentation about the future of oil shale at Rifle Community College on November 19, written by Mike McKibbin for the Rifle Citizen-Telegram. Here’s an excerpt:

The long sought-after petroleum product is infamous for its long-held promise of economic benefits, high-paying jobs and what sounds like an almost non-ending supply to meet America’s growing energy needs.

But while that reality has proved elusive for centuries, some, such as Glenn Vawter, executive director of the National Oil Shale Association, are ever optimistic. The nonprofit group promotes factual information about oil shale…

“I firmly believe we will some day see oil shale become a reality, and 75 percent of the world’s oil shale is in the U.S.,” Vawter said. “It’s already been produced commercially for decades in Brazil, Estonia and China.”[...]

The underground mining processes used by companies such as Unocal, which produced 10,000 barrels of shale oil a day during its limited operation, totaled five-million barrels and was proven feasible, Vawter said.

The in-situ process that companies are now developing has the advantage of no mining, Vawter said.

Currently, research, design and development projects on Bureau of Land Management leases are underway by American Shale Oil, ExxonMobil and Natural Soda in western Garfield and Rio Blanco counties, along with Red Leaf Resources and Enefit American Oil in Utah.

“It was discouraging that Shell recently announced they were pulling out,” Vawter said. “But Red Leaf plans to start commercial production of up to 10,000 barrels a day in Utah next year. There’s a lot going on over there in Utah. They have policies that are more welcoming to energy and oil shale industries.”

Enefit has operated shale oil projects in Estonia for decades, Vawter pointed out, with a proven technology.

And Vawter pointed to a recent U.S. Geological Survey estimate of 4.3 trillion barrels of shale oil in Colorado, Wyoming and Utah. Of that, Vawter said up to 1.14 billion barrels are now considered recoverable. That is up to six times more than the total oil reserves in Saudi Arabia and significantly more than known U.S. conventional oil resources.

“There are places in the Piceance Basin that are estimated to have one million barrels in just one acre,” Vawter said. “The Piceance Basin could have up to 152 trillion barrels.”

Water used in the oil shale process has often been cited by opponents as a large hurdle, Vawter said, but current processes for a 1.5 million barrel per day project would require just 2 to 3 percent of an estimated 8 million acre feet per year of water in the Colorado River.

“That’s not an insignificant amount, but it’s far less than some still believe,” he said…

More oil shale coverage here and here.


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