Exploration and Production Technologies

Review and Update Venture Development Plan for U.S. Resources

DE-AC21-93MC29240

Project Goal
The goal of this project is to assemble the technical, market, and economic data needed for evaluating venture development of the U.S. oil shale resource when applying the Value Enhancement Process Technology.

Performer
James W. Bunger & Associates
Salt Lake City, UT

Project Results
A patent was issued to the performer on the Value-Enhancement Process (VEP) for kerogen refining.

Benefits
New sources of hydrocarbons are needed to meet increasing U.S. demand for oil. This project provides a refining process and economic analysis of using oil shale as a petroleum source. This source has the potential to increase domestic oil production, thereby filling at least part of America's growing oil demand.

Background
During the 1970s and 1980s, the U.S. had an active program in oil shale research. Most of that research was scaled back or abandoned because of the availability of crude oil at much lower costs. With energy security becoming an important priority again, there is an increased interest in advancing an oil shale industry in the U.S.

Information obtained on U.S. resources dated, and economics, markets, and prospects for production have changed. Today, there is an awareness of limitations on conventional petroleum supply, as well as the need for development of energy-efficient unconventional resources. This research is designed to update all information that impacts oil shale development in the U.S.

Project Summary
The project calls for the performer to:

  • Review the current status of oil products, markets, prices, and economics.
  • Update conceptual value-enhancement process as applied to U.S kerogen oil, including mass balances and energy requirements. The process may be supported by additional analytical and laboratory process research.
  • Update the venture development plan for U.S oil shale resources, including estimates of capital requirements and economic viability as a function of crude oil prices.

VEP for oil shale produces syncrude, a variety of pure compounds and broad-range (mixture) products. In the process, raw kerogen oil is sent to a liquid-liquid extractor where polar compounds are separated as an extract from non-polar compounds that constitute the raffinate. Solvent is recovered by distillation from each stream and recycled to the extractor. The solvent-free extract is sent to a distillation unit, where light ends are removed for processing to pure compounds; details of the solvent recovery and distillation scheme depend on the properties of the target compounds. Heavy ends are split for manufacture of broad-range products, such as asphalt additive, or sent to dealkylation (hydropyrolysis) to remove alkyl chains from nitrogen heterocyclic compounds. The total condensable product from dealkylation is recycled to extraction, where the alkyl groups report to the raffinate and the nitrogen heterocyclic compounds report to extract. The raffinate is sent to a catalytic hydrotreater, where remaining sulfur and nitrogen are removed to manufacture a sweet, high-quality synthetic crude oil. Hydrogen is manufactured from the non-condensable gases obtained from the dealkylation unit. Hydrogen is used in both the hydrotreating and dealkylation steps.

A paper was presented at the American Association of Petroleum Geologists meeting held in Calgary, Canada, on June 19-22, 2005. The presentation compared the development of the Athabascan oil sands with the potential for oil shale development in the U.S. It noted that a mature oil shale venture would be profitable with West Texas Intermediate crude selling for $30 per barrel. A first-generation oil shale plant would have to overcome capital and operating costs of an additional $11 per barrel over this threshold.

Current Status (July 2007)
The project performer’s no-cost extension has expired. The final report is not yet completed. The oil shale industry has undergone tremendous changes, and the study will be much more valuable if it reflects the recent work. In particular, whereas the original concept anticipated using value-enhanced products as a means of making shale oil economical at a small scale with crude oil prices in the vicinity of $20/bbl, VEP will now likely take a slipstream of a much larger project, as oil prices are well over $30/bbl. This means market volume constraints will be more important than before.

Project Start: June 15, 1993
Project End: August 30, 2007

Anticipated DOE Contribution: $2,471,621
Performer Contribution: $0

Contact Information
NETL - Betty Felber (betty.felber@netl.doe.gov or 918-699-2031)
JWBA - James Bunger (Jim@JWBA.com or 801-975-1456)

Publications 
Bunger, J.W., Crawford, P.M., and Johnson, H R., “Is Oil Shale America’s Answer to Peak Oil Challenge?” Oil & Gas Journal, August 9, 2004.

Bunger, J., Dammer, A., Guthrie, H., and Gangle, B., “Comparative Analysis of Athabasca Oil Sands and Green River Oil Shale Resources—Implications for Production,” presented at the AAPG Annual meeting held in Calgary, Canada, on June 19-22, 2005.

U.S. Patent issued for Value Enhancement Process for refining kerogen oil, cf. U.S. 6,875,341, April 5, 2005, Estonia Patent Pending.

Bunger, J., and Dammer, A., “Oil Shale Development—Analogy to Oil Sands,” Energy Frontiers Conference, Denver, CO, May 10, 2006.

Bunger, J., and Dammer, A., “Oil Shale Development—Is Now the Time?” Society of Petroleum Engineers/Utah Geological Society, Salt Lake City, UT, May 19, 2006.


Extract and raffinate from kerogen oil. Photo courtesy of James Bunger.


Turn-of-the-century oil shale retort. Photo courtesy of James Bunger.

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