Survey of Energy Resources: Oil Shale

If a technology can be developed to economically recover oil from oil shale, the potential is tantalisingly enormous. If the containing organic material could be converted to oil, the quantities would be far beyond all known conventional oil reserves. Oil shale in great quantities exists worldwide: including in Australia, Brazil, Canada, China, Estonia, France, Russia, Scotland, South Africa, Spain, Sweden and the USA.

The term “oil shale” is a misnomer. It does not contain oil nor is it commonly shale. The organic material is chiefly kerogen, and the “shale” is usually a relatively hard rock, called marl. Properly processed, kerogen can be converted into a substance somewhat similar to petroleum. However, it has not gone through the “oil window” of heat (nature’s way of producing oil) and therefore, to be changed into an oil-like substance, it must be heated to a high temperature. By this process the organic material is converted into a liquid, which must be further processed to produce an oil which is said to be better than the lowest grade of oil produced from conventional oil deposits, but of lower quality than the upper grades of conventional oil.

There are two conventional approaches to oil shale processing. In one, the shale is fractured in-situ and heated to obtain gases and liquids by wells. The second is by mining, transporting, and heating the shale to about 450^oC, adding hydrogen to the resulting product, and disposing of and stabilising the waste. Both processes use considerable water. The total energy and water requirements together with environmental and monetary costs (to produce shale oil in significant quantities) have so far made production uneconomic. During and following the oil crisis of the 1970’s, major oil companies, working on some of the richest oil shale deposits in the world in western United States, spent several billion dollars in various unsuccessful attempts to commercially extract shale oil.

Oil shale has been burned directly as a very low grade, high ash-content fuel in a few countries such as Estonia, whose energy economy remains dominated by shale. Minor quantities of oil have been obtained from oil shale in several countries at times over many years.

With increasing numbers of countries experiencing declines in conventional oil production, shale oil production may again be pursued. One project is now being undertaken in north-eastern Australia, but it seems unlikely that shale oil recovery operations can be expanded to the point where they could make a major contribution toward replacing the daily consumption of 73 million barrels of oil worldwide.

Perhaps oil shale will eventually find a place in the world economy, but the energy demands of blasting, transport, crushing, heating and adding hydrogen, together with the safe disposal of huge quantities of waste material, are large. On a small scale, and with good geological and other favourable conditions, such as water supply, oil shale may make a modest contribution but so far shale oil remains the “elusive energy”.

Walter Youngquist,
Consulting Geologist
Eugene, Oregon, USA

DEFINITIONS

In Table 3.1 the following definitions apply:

Oil Shales are sedimentary rocks containing a high proportion of organic matter (kerogen) which can be converted to synthetic oil or gas by processing.

Proved amount in place is the tonnage of oil shale that has been carefully measured and assessed as exploitable under present and expected local economic conditions with existing available technology.

Proved recoverable reserves are the tonnage of synthetic crude oil that has been carefully measured and assessed as recoverable under present and expected local economic conditions with existing available technology.

Average yield of oil is based on Fischer assay or equivalent analytical technique.

Estimated additional reserves are the amount, expressed as tonnage of recoverable synthetic crude oil (additional to Proved Recoverable Reserves), that is of foreseeable economic interest. Speculative amounts are not included.

Table 3.1 Oil shale: resources, reserves and production at end-1999
Excel File	Recovery method	Proved amount in place	Proved recoverable reserves	Average yield of oil	Estimated additional reserves	Production in 1999
		million tonnes (shale)	million tonnes (oil)	kg oil/ tonne	million tonnes (oil)	thousand tonnes (oil)
Africa
Morocco	surface	12 300	500	50 – 64	5 400
South Africa	in-situ	73		10
North America
United States of America	surface	3 340 000	60 000 – 80 000	57	62 000
South America
Brazil	surface			70	9 646	195
Asia
Thailand	in-situ	18 668	810	50
Turkey	surface	1 640	269	56
Europe
Albania	surface	6			5
Estonia	surface	590		167		151
	in-situ	910
Ukraine	in-situ	2 674	300	126	6 200
Middle East
Israel	surface	15 360	600	62
Jordan	surface	40 000	4 000	100	20 000
Oceania
Australia	in-situ	32 400	1 725	53	35 260	5
Notes:
1. Generally the data shown above are those reported by WEC Member Committees in 2000/2001
2. The data for Albania, Brazil, Israel, South Africa and Ukraine are those reported by WEC Member Committees for SER 1998
3. The data thus constitute a sample, reflecting the information available in particular countries: they should not be considered as complete, or necessarily representative of the situation in each region. For this reason, regional and global aggregates have not been computed

 

COUNTRY NOTES

The following Country Notes on oil shale have been compiled by the editors, drawing upon a wide variety of material, including information received from WEC Member Committees, national and international publications.

Australia

For the present Survey, the Australian Geological Survey Organisation (AGSO) has reported a proved amount in place of 32.4 billion tonnes of oil shale, with proved recoverable reserves of oil put at 1 725 million tonnes. Additional reserves of shale oil are huge: in excess of 35 billion tonnes.

Production from oil shale deposits in south-eastern Australia began in the 1860’s, coming to an end in the early 1950’s when government funding ceased. Between 1865 and 1952 some 4 million tonnes of oil shale were processed.

During the 1970’s and early 1980’s a modern exploration programme was undertaken by two Australian companies, Southern Pacific Petroleum N.L. and Central Pacific Minerals N.L. (SPP/CPM). The aim was to find high-quality oil shale deposits amenable to open-pit mining operations in areas near infrastructure and deepwater ports. The programme was successful in finding a number of silica-based oil shale deposits of commercial significance along the coast of Queensland.

In 1995 SPP/CPM signed a joint venture agreement with the Canadian company Suncor Energy Inc. to commence development of one of the oil shale deposits, the Stuart Deposit. Located near Gladstone, it has a total in-situ shale oil resource of 2.6 billion barrels and the capacity to produce more than 200 000 b/d. Suncor had had the role of operator of the Stuart project, but in April 2001, SPP/CPM purchased Suncor’s interest.

The Stuart project incorporates the Alberta-Taciuk Processor (ATP) retort technology (initially developed for potential application to the Alberta oil sands) and has three stages. The Stage 1 demonstration plant is currently being commissioned and tested, with full production being gradually attained during 2001. The plant is designed to process 6 000 t/d of run-of-mine (wet shale) to produce 4 500 b/d of shale oil products. After technical and economic feasibility has been proved, it is planned that the ATP in Stage 2 will be scaled up to a commercial-sized module processing 25 000 t/d and producing 14 800 b/d oil products. A Stage 3 commercial plant is conceived as processing 125 000 t/d of oil shale to give 65 000 b/d oil products, thus bringing total Stuart production to about 85 000 b/d by 2009.

The raw shale oil produced will constitute a relatively light crude with a 42^o API gravity, 0.4 wt% sulphur and 1.0 wt% nitrogen. To meet the needs of the market, the raw oil requires further processing, resulting in raw low-sulphur naphtha and medium shale oil (MSO). It is planned that the MSO will be sent directly to tankage for marketing as a 27^o API gravity, 0.4 wt% sulphur fuel oil cutter stock, while the raw naphtha will be hydrotreated to remove nitrogen and sulphur to below 1 ppm. It is claimed that the hydrotreated naphtha would provide an ideal feedstock in the manufacture of clean gasoline with low emissions characteristics. In future phases of Stuart, other product options would be available depending on market conditions.

It was announced in May 2001 that the first shipment of over 40 000 barrels (5 800 tonnes) of MSO had been made to the south-east Asian fuel oil market.

Brazil

The oil shale resource base is one of the largest in the world and was first exploited in the late nineteenth century in the State of Bahia. In 1935 shale oil was produced at a small plant in São Mateus do Sul in the State of Paraná and in 1950, following government support, a plant capable of producing 10 000 b/d shale oil was proposed for Tremembé, São Paulo.

Following the formation of Petrobras in 1953, the company developed the Petrosix process for shale transformation. Concentrating its operations on the reservoir of São Mateus do Sul, the company brought a pilot plant (8 inch internal diameter retort) into operation in 1982. Its purpose is for oil shale characterisation, retorting tests and developing data for economic evaluation of new commercial plants. A 6 foot (internal diameter) retort demonstration plant followed in 1984 and is used for the optimisation of the Petrosix technology.

A 2 200 (nominal) tons per day, 18 foot (internal diameter) semi works retort (the Irati Profile Plant), originally brought on line in 1972, began operating on a limited commercial scale in 1981 and a further commercial plant – the 36 foot (internal diameter) Industrial Module retort was brought into service in December 1991. Together the two commercial plants process some 7 800 tonnes of bituminous shale daily. The retort process (Petrosix) where the shale undergoes pyrolysis yields a nominal daily output of 3 870 barrels of shale oil, 120 tonnes of fuel gas, 45 tonnes of liquefied shale gas and 75 tonnes of sulphur. Output of shale oil in 1999 was 195.2 thousand tonnes.

The Ministry of Mines and Energy quotes end-1999 shale oil reserves as 445.1 million m³ measured/indicated/inventoried and 9 402 million m³ inferred/estimated with shale gas reserves as 111 billion m³ measured/indicated/inventoried and 2 353 billion m³ inferred/estimated.

Canada

Oil shales occur throughout the country, with the best known and most explored deposits being those in the provinces of Nova Scotia and New Brunswick. Of the areas in Nova Scotia known to contain oil shales, development has been attempted at two – Stellarton and Antigonish. Mining took place at Stellarton from 1852-1859 and 1929-1930 and at Antigonish around 1865. The Stellarton Basin is estimated to hold some 825 million tonnes of oil shale, with an in-situ oil content of 168 million barrels. The Antigonish Basin has the second largest oil shale resource in Nova Scotia, with an estimated 738 million tonnes of shale and 76 million barrels of oil in situ.

Investigations into retorting and direct combustion of Albert Mines shale (New Brunswick) have been conducted, including some experimental processing in 1988 at the Petrobras plant in Brazil. Interest has been shown in the New Brunswick deposits for the potential they might offer to reduce sulphur emissions by co-combustion of carbonate-rich shale residue with high-sulphur coal in power stations.

China

Fushun, a city in the north-eastern province of Liaoning, is known as the Chinese “Capital of Coal”. Within the Fushun coalfield the West Open Pit mine is the largest operation and is where, in addition to coal, oil shale from the Eocene Jijuntun Formation is mined.

The average thickness of the Jijuntun Formation is estimated to be 115 m (within a range of 48-190 m). The oil shale (known as “brown combustible shale” in China) in the formation can be divided into two parts of differing composition: the lower 15 m of light-brown oil shale of low-grade and the upper 100 m of brown to dark-brown, finely laminated oil shale. The oil content of the low-grade oil shale is less than 4.7% by weight and the richer upper grade is greater than 4.7%. However, depending on the exact location of the deposit, the maximum oil content can be as high as 16%. It has been reported that the average oil content is 7-8% which would produce in the region of 78-89 litres of oil per tonne of oil shale (assuming a 0.9 specific gravity).

In 1983 the Chinese reported that the oil shale resources in the area of the West Open Pit mine were 260 million tonnes, of which 235 million tonnes were considered mineable. It has also been reported that the entire Fushun area has a resource of approximately 3.6 billion tonnes.

The commercial extraction of oil shale and the operation of heating retorts for processing the oil shale were developed in Fushun between 1920-1930. After World War II, Refinery No. 1 had 200 retorts, each with a daily throughput of 100-200 tonnes of oil shale. It continued to operate and was joined by the Refinery No.2 starting up in 1954. In Refinery No. 3 shale oil was hydrotreated for producing light liquid fuels. Shale oil was also open-pit mined in Maoming, Guangdong Province and 64 retorts were put into operation there in the 1960’s.

At the beginning of the 1960’s 266 retorts were operating in Fushun’s Refineries Nos. 1 and 2. However, by the early 1990’s the availability of much cheaper crude oil had led to the Maoming operation and Fushun Refineries No. 1 and 2 being shut down.

A new facility – the Fushun Oil Shale Retorting Plant – came into operation in 1992 under the management of the Fushun Bureau of Mines. Its 60 retorts annually produce 60 000 tonnes of shale oil to be sold as fuel oil, with carbon black as a by-product.

Estonia

Oil shale was first scientifically researched in the 18^th century. In 1838 work was undertaken to establish an open-cast pit near the town of Rakvere and an attempt was made to obtain oil by distillation. Although it was concluded that the rock could be used as solid fuel and, after processing, as liquid or gaseous fuel, the “kukersite” (derived from the name of the locality) was not exploited until the fuel shortages created by World War I began to impact.

The Baltic Oil Shale Basin is situated near the north-western boundary of the East European Platform. The Estonia and Tapa deposits are both situated in the west of the Basin, the former being the largest and highest-quality deposit within the Basin.

Since 1916 oil shale has had an enormous influence on the energy economy, particularly during the period of Soviet rule and then under the re-established Estonian Republic. At a very early stage, an oil shale development programme declared that kukersite could be used directly as a fuel in the domestic, industrial or transport sectors. Moreover, it is easily mined and could be even more effective as a combustible fuel in power plants or for oil distillation. Additionally kukersite ash could be used in the cement and brick-making industries.

Permanent mining began in 1918 and has continued until the present day, with capacity (both underground mining and open-cast) increasing as demand rose. By 1955 oil shale output had reached 7 million tonnes and was mainly used a power station/chemical plant fuel and in the production of cement. The opening of the 1 400 MW Baltic Thermal Power Station in 1965 followed, in 1973, by the 1 600 MW Estonian Thermal Power Station again boosted production and by 1980 (the year of maximum output) the figure had risen to 31.35 million tonnes.

In 1981, the opening of a nuclear power station in the Leningrad district of Russia signalled the beginning of the decline in Estonian oil shale production. No longer were vast quantities required for power generation and the export of electricity. The decline lasted until 1995, with some small annual increases thereafter.

The Estonian government has taken the first steps towards privatisation of the oil-shale industry and is beginning to tackle the air and water pollution problems that nearly a century of oil shale processing has brought.

In 1999 10.7 million tonnes of oil shale were produced. Imports amounted to 1.4 million tonnes, 0.01 million tonnes were exported, 11.1 million tonnes used for electricity and heat generation, and 1.3 million tonnes were distilled to produce 151 000 tonnes of shale oil.

The Development Plan states that the share of oil shale in the Estonian national primary energy balance must be reduced from 62% to 52-54% by 2005 and to 47-50% by 2010. In 1999 the Sompa and Tammiku mine fields were closed down and Ahtme and Kohtla are likely targets in the future.

Estonian oil shale resources are currently put at 5 billion tonnes including 1.5 billion tonnes of active (mineable) reserves. It is possible that the power production part of the industry will disappear by 2020 and that the resources could last for 30-50 years but scenarios abound on the replacement of oil shale by alternative resources.

Germany

The German WEC Member Committee reports that under existing or expected economic conditions there are no recoverable or additional reserves. A 1995 energy study quoted Germany oil shale resources as 3 billion tonnes “oil in place”.

A minimal quantity (0.5 million tonnes per annum) of oil shale is produced for use at the Rohrback cement works at Dotternhausen in southern Germany, where it is consumed directly as a fuel for power generation, the residue being used in the manufacture of cement.

Israel

Sizeable deposits of oil shale have been discovered in various parts of Israel, with the principal resources located in the north of the Negev desert. The Israeli WEC Member Committee reported in 1998 that the proved amount of oil shale in place exceeded 15 billion tonnes, containing proved recoverable reserves of 600 million tonnes of shale oil. The largest deposit (Rotem Yamin) has shale beds with a thickness of 35-80 m, yielding 60-71 litres of oil per tonne. Generally speaking, Israeli oil shales are relatively low in heating value and oil yield, and high in sulphur content, compared with other major deposits. A pilot power plant fuelled by oil shale has been technically proven in the Negev region. Annual production of oil shale has averaged 450 000 tonnes in recent years.

Jordan

There are extremely large proven and exploitable reserves of oil shale in the central and north-western regions of the country. The proved amount of oil shale in place is reported by the WEC Member Committee to be 40 billion tonnes; proved recoverable reserves of shale oil are put at 4 billion tonnes, with estimated additional reserves of 20 billion tonnes.

Jordanian shales are generally of quite good quality, with relatively low ash and moisture content. Gross calorific value (7.5 MJ/kg) and oil yield (8-12%) are on a par with those of western Colorado (USA) shale; however, Jordanian shale has an exceptionally high sulphur content (up to 9% by weight of the organic content). The reserves are exploitable by opencast mining and are easily accessible.

For several years the Ministry of Energy and Mineral Resources (MEMR) has been in contact with a number of companies with a view to reaching an acceptable agreement for constructing a shale-fired private power station and for the production of shale oil by retorting. International companies have been invited to carry out feasibility studies and to submit their offers to MEMR.

Suncor of Canada has conducted limited exploration in the Lajjun area, southwest of Amman. During 1999 the company was engaged in discussions with MEMR on the possible development of an oil shale extraction facility.

The eventual exploitation of what is Jordan’s only substantial fossil fuel resource to produce liquid fuels and/or electricity, together with chemicals and building materials, would be favoured by three factors – the high organic-matter content of Jordanian oil shale, the suitability of the deposits for surface-mining and their location near potential consumers (i.e. phosphate mines, potash and cement works).

Morocco

Morocco has very substantial oil shale reserves but to date they have not been exploited. During the early 1980’s, Shell and the Moroccan state entity ONAREP conducted research into the exploitation of the oil-shale reserves at Tarfaya, and an experimental shale-processing plant was constructed at another major deposit (Timahdit). At the beginning of 1986, however, it was decided to postpone shale exploitation at both sites and to undertake a limited programme of laboratory and pilot-plant research.

The WEC Member Committee for Morocco quotes the proved amount of oil shale in place as 12.3 billion tonnes, with proved recoverable reserves of shale oil amounting to 3.42 billion barrels (equivalent to approximately 500 million tonnes).

Russian Federation

There are oil shale deposits in Leningrad Oblast, across the border from those in Estonia. Annual output is estimated to be about 2 million tonnes, most of which is exported to the Baltic power station in Narva, Estonia. In 1999 Estonia imported 1.4 million tonnes of Russian shale but is aiming to reduce the amount involved, or eliminate the trade entirely. There is another oil-shale deposit near Syzran on the river Volga.

The exploitation of Volga Basin shales, which have a higher content of sulphur and ash, began in the 1930’s. Although the use of such shale as a power-station fuel has been abandoned owing to environmental pollution, a small processing plant may still be operating at Syzran, with a throughput of less than 50 000 tonnes of shale per annum.

Thailand

Some exploratory drilling by the government was made as early as 1935 near Mae Sot in Tak Province on the Thai-Burmese border. The oil-shale beds are relatively thin and the structure of the deposit is complicated by folding and faulting.

Some 18.7 billion tonnes of oil shale have been identified in Tak Province but to date it has not been economic to exploit the deposits. Proved recoverable reserves of shale oil are put at 810 million tonnes.

United States Of America

It is estimated that nearly 62% of the world’s potentially recoverable oil shale resources are concentrated in the USA. The largest of the deposits is found in the 42 700 km² Eocene Green River formation in north-western Colorado, north-eastern Utah and south-western Wyoming. The richest and most easily recoverable deposits are located in the Piceance Creek Basin in western Colorado and the Uinta Basin in eastern Utah. The shale oil can be extracted by surface and in-situ methods of retorting: depending upon the methods of mining and processing used, as much as one-third or more of this resource might be recoverable. There are also the Devonian-Mississippian black shales in the eastern United States.

Data reported for the present Survey indicate the vastness of US oil shale resources: the proved amount of shale in place is put at 3 340 billion tonnes, with a shale oil content of 242 billion tonnes, of which about 89% is located in the Green River deposits and 11% in the Devonian black shales. Recoverable reserves of shale oil are estimated to be within the range of 60-80 billion tonnes, with additional resources put at 62 billion tonnes.

Oil distilled from shale was burnt and used horticulturally in the second half of the 19^th century in Utah and Colorado but very little development occurred at that time. It was not until the early 1900’s that the deposits were first studied in detail by USGS and the government established the Naval Petroleum and Oil Shale Reserves, that for much of the 20^th century served as a contingency source of fuel for the nation’s military. These properties were originally envisioned as a way to provide a reserve supply of oil to fuel US naval vessels.

Oil shale development had always been on a small scale but the project that was to represent the greatest development of the shale deposits was begun immediately after World War II in 1946 – the US Bureau of Mines established the Anvils Point oil shale demonstration project in Colorado. However, processing plants had been small and the cost of production high. It was not until the USA had become a net oil importer, together with the oil crises of 1973 and 1979, that interest in oil shale was reawakened.

In the latter part of the 20^th century military fuel needs changed and the strategic value of the shale reserves began to diminish. In the 1970’s ways to maximise domestic oil supplies were devised and the oil shale fields were opened up for commercial production. Oil companies led the investigations: leases were obtained and consolidated but one-by-one these organisations gave up their oil shale interests. Unocal was the last to do so in 1991.

Recoverable resources of shale oil from the marine black shales in the eastern United States were estimated in 1980 to exceed 400 billion barrels. These deposits differ significantly in chemical and mineralogical composition from Green River oil shale. Owing to its lower H:C ratio, the organic matter in eastern oil shale yields only about one-third as much oil as Green River oil shale, as determined by conventional Fischer assay analyses. However, when retorted in a hydrogen atmosphere, the oil yield of eastern oil shale increases by as much as 2.0-2.5 times the Fischer assay yield.

Green River oil shale contains abundant carbonate minerals including dolomite, nahcolite, and dawsonite. The latter two minerals have potential by-product value for their soda ash and alumina content, respectively. The eastern oil shales are low in carbonate content but contain notable quantities of metals, including uranium, vanadium, molybdenum, and others which could add significant by-product value to these deposits.

All field operations have ceased and at the present time shale oil is not being produced in the USA. Large-scale commercial production of oil shale is not anticipated before the second or third decade of the 21^st century.