Progress and Plans on AMSO’s RD&D Lease...

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Progress and Plans on Progress and Plans on AMSO AMSO s s RD&D Lease Tract RD&D Lease Tract Alan K. Burnham, PhD Chief Technology Officer American Shale Oil, LLC Presented at: Unconventional Fuels Conference Salt Lake City, UT, April 28, 2010

Transcript of Progress and Plans on AMSO’s RD&D Lease...

Page 1: Progress and Plans on AMSO’s RD&D Lease Tractrepository.icse.utah.edu/dspace/bitstream/123456789/10868...1 Progress and Plans on AMSO’s RD&D Lease Tract Alan K. Burnham, PhD Chief

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Progress and Plans on Progress and Plans on AMSOAMSO’’ssRD&D Lease TractRD&D Lease Tract

Alan K. Burnham, PhDChief Technology OfficerAmerican Shale Oil, LLC

Presented at:Unconventional Fuels ConferenceSalt Lake City, UT, April 28, 2010

Page 2: Progress and Plans on AMSO’s RD&D Lease Tractrepository.icse.utah.edu/dspace/bitstream/123456789/10868...1 Progress and Plans on AMSO’s RD&D Lease Tract Alan K. Burnham, PhD Chief

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The 160-acre BLM lease was established in January 2007 under EGL Resources and transferred shortly thereafter to EGL Oil Shale

IDT acquired EGL Oil Shale in 2008 and renamed it AMSO

In March 2009, Total acquired a 50% interest in AMSO

AMSO is one of three RD&D Leaseholders AMSO is one of three RD&D Leaseholders in Coloradoin Colorado’’s Piceance Basins Piceance Basin

Page 3: Progress and Plans on AMSO’s RD&D Lease Tractrepository.icse.utah.edu/dspace/bitstream/123456789/10868...1 Progress and Plans on AMSO’s RD&D Lease Tract Alan K. Burnham, PhD Chief

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There are number of issues to be addressed There are number of issues to be addressed for oil shale developmentfor oil shale development

Water usage

Protection of aquifers

Impact on communitiesPopulation growthInfrastructure needs

Land and wildlife disturbance

Air emissions, including CO2

Page 4: Progress and Plans on AMSO’s RD&D Lease Tractrepository.icse.utah.edu/dspace/bitstream/123456789/10868...1 Progress and Plans on AMSO’s RD&D Lease Tract Alan K. Burnham, PhD Chief

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We believe AMSO’s process and development plan addresses all these concerns

We propose to develop the illitic oil shale

separated from aquifers by nahcolitic oil shale

2000 ft

Nahcolitic oil shale cap rock

Illitic oil shale

Mahogany zone

Better water quality

Saline water

Dissolution surface

2000

ft10

00 ft

aqui

fer s

yste

m

Heat injection

well Production well

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AMSO’s patent-pending CCRTM* process uses a unique method to distribute heat throughout its in-situ retort

Faster heat transfer in our process enables fewer wells, hence less surface impact, to extract the shale oil

* Conduction, Convection and Reflux

AMSOAMSO’’s ins in--situ heat transfer method is uniquesitu heat transfer method is unique

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Our RD&D Plan aims to demonstrate Our RD&D Plan aims to demonstrate important aspects of our processimportant aspects of our process

Geochemical and geomechanical properties of the illitic oil shale

Hydrologic isolation of the illitic oil shale from protected waters

Adequate heat transfer using a boiling oil poolCentral to the Conduction, Convection, Reflux (CCRTM) conceptEnhancement by thermo-mechanical fragmentation

Premium oil qualityHigh API gravity, low metals content, low nitrogen content

Minimal water usage (<1 barrel of water per barrel of oil)

Ability to meet all applicable air emission regulations

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Retort configuration Associated ground water monitoring

oil shale

We are moving towards a pilot test of our We are moving towards a pilot test of our process concept in late 2010process concept in late 2010

~45o incline

Pilot test interval (2015-2135 ft)

Nahcolitic oil shale

Surface processing facility

heater well(electrical

cables only) tomography wells

Better water quality

heater

Saline waterDissolution surface

2000

ft10

00 ft

Wasatch (no producible water)

Mahogany zone

production well

Aqu

ifer s

yste

m

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Groundwater inflow is very low in the R1, Groundwater inflow is very low in the R1, L1, R0, and WasatchL1, R0, and Wasatch

TM-1: <0.01 gpmBased on one-hour pressure head monitoring following borehole evacuationR-1 TDS ~ 10,400 ppm

BH-1: 0.001 gpm (avg)Based on 18-day pressure head monitoring following well completionTDS ~ 41,800 ppm

MWP2-WS: 0.0001 gpmBased on video detection of fluid rise (oil plus water) over 4 monthsWS TDS ~ 6500 ppm

~10

0 ft

~40

0 ft

~20

0 ft

Dissolution surface ~1850 ft

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The R1 and L1 thickness change The R1 and L1 thickness change substantially across our RD&D tractsubstantially across our RD&D tract

MWP-1-L3 MWP-2-WSBH-1CH-1

Substantial slumping is

observed in L1

R1

L1

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We confirmed that our retort location has We confirmed that our retort location has no dikes, faults, or slumps no dikes, faults, or slumps

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Depth, ft

TM-1 BH-197 ft

High velocity=low grade

Low velocity=high grade

1600 -

1700 -

-1 -197 ft

High velocity=low grade

Low velocity=high gradepilot test interval

1800 -

2300 -

2200 -

2100 -

2000 -

1900 -

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Our site preparations are progressingOur site preparations are progressing

Test Pad has an exploration Test Pad has an exploration well (CHwell (CH--1) and will hold the 1) and will hold the Heater Well (THeater Well (T--1H) and the 1H) and the Surface Processing Surface Processing FacilitiesFacilities

MWP 2 has MWP 2 has BG, L3, and BG, L3, and WS hydrology WS hydrology wellswells

HB Pad has an L3 HB Pad has an L3 hydrology wellhydrology well

MWP 1 has an MWP 1 has an L3 hydrology L3 hydrology well and staff well and staff trailerstrailers

TM Pad has an exploration TM Pad has an exploration well (BHwell (BH--1) and a 1) and a geophysical monitoring geophysical monitoring well (TMwell (TM--1) over the retort 1) over the retort area. The Production Well area. The Production Well and five more monitoring and five more monitoring wells will be added (2010)wells will be added (2010)

Access Access roads roads built Nov built Nov 20092009

3 MW power line 3 MW power line installed Feb 2010installed Feb 2010

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Our Pilot Test is moving towards realizationOur Pilot Test is moving towards realization

Our site characterization activities confirm the suitability of the Illite Mining Interval

There is essentially no producible waterMinor amounts of gas and bitumen should not interfere

Most of the permits and agency approvals are in placeWe expect the EPA UIC permit by early summer 2010

Most of the infrastructure is in place

Construction is starting on the surface facilities

We are completing the designs for the heater and production wells

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Our RD&D phase will involve about 20 people

Our commercial process will use a small, stable labor forceA few hundred people for drilling and production operationsProduction target of about 100,000 bbl/day*

At 350 bbl/day per worker, each worker will produce enough oil for 5,000 people

At a royalty rate of $10/barrel**, each worker would generate $1.2 million per year in royalties

It is important that part of these royalties are used to improveinfrastructure in the area

* This exceeds Colorado’s average annual oil production of 57,000 bbl/day over the past decade** The BLM has established a maximum royalty rate of 12.5%, which at a price per barrel of $80, would translate into $10/barrel

Our goal is to maximize benefits to the Our goal is to maximize benefits to the Nation and the local communitiesNation and the local communities

Page 14: Progress and Plans on AMSO’s RD&D Lease Tractrepository.icse.utah.edu/dspace/bitstream/123456789/10868...1 Progress and Plans on AMSO’s RD&D Lease Tract Alan K. Burnham, PhD Chief

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AMSOAMSO’’ss oil shale process effectively uses oil shale process effectively uses water for high economic contributionwater for high economic contribution

True in-situ processes have no mining, crushing, or spent-shale disposal needing water for dust control

AMSO’s retort interval is isolated from drinking water, so no aquifer remediation is required

Anticipated water usage is less than one barrel of water per barrel of shale oil

Projected to 100,000 bbl/day, AMSO would use ~0.1% of the state’s water and generate ~1% of the state’s GDP

White River in Rio Blanco County

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AMSO plans fewer wells to minimize surface AMSO plans fewer wells to minimize surface footprintfootprint

2000 ft

2000 ft

200-ft-wide drilling corridor

Our retort panels will achieve high resource recovery in the illite shale

By using long horizontal wells, drilling should impact <10% of the surface area

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Land reclamation has already been Land reclamation has already been demonstrated from the 1980s activitydemonstrated from the 1980s activity

Photo of reclaimed land from Rio Blanco Oil Shale Project in Piceance Basin