progress and plans on amso’s rd&d lease...
TRANSCRIPT
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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
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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
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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
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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
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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