Register

Peak Oil is You


Donate Bitcoins ;-) or Paypal :-)


Page added on September 27, 2013

Bookmark and Share

Shell Abandons Oil-Shale Project In Colorado After Pumping Millions Into Exploration

Production

Royal Dutch Shell PLC has become the latest company to abandon efforts to turn Western Slope oil-shale into oil, joining a long line of companies in a boom and bust cycle in the region.

The company said energy markets have changed since the project started in 1982, and the company no longer wants to continue efforts to turn oily shale rock into liquid by heating the rock and pumping out the oil.

Chevron stopped its oil-shale research in Rio Blanco County in February 2012.

“We are exiting our Colorado project to focus on other opportunities,” Shell spokeswoman Kelly op de Weegh said. “Our focus is to work with our staff and contractors to safely stop research activities and close the site.”

Efforts to squeeze the oil from the shale in the Rockies stretch back decades. An oil shale boom in Colorado in the early 1980s went bust when oil prices dropped and government subsidies dried up. People still refer to “Black Sunday,” May 2, 1982, when Exxon Mobil Corp. shut down a $5 billion project near the West Slope town of Parachute, throwing 2,200 people out of work.

“The economics of oil shale have always been the issue,” said David Abelson, an analyst with Western Resource Advocates, an environmental group opposing shale development.

Shell spent an estimated $30 million to create a test subterranean wall to hold in the shale oil when it was heated, but full-scale production would probably have required building a large power plant, the Denver Post reported Wednesday (http://tinyurl.com/qydcqph).

The new oil plays in North Dakota and Texas and along Colorado’s Front Range, which are producing large quantities of oil, hurt the viability of oil shale, said Jim Spehar, former mayor of Grand Junction.

“Out here on the Western Slope, oil shale will always be the fuel of the future,” Spehar said.

Shell on Tuesday announced plans to build a $12.5 billion plant in Louisiana that would turn natural gas into diesel, jet fuel and other liquids.

“We have a large portfolio of opportunities, all competing for capital,” op de Weegh said.

Government and industry officials estimate 1 trillion to 1.8 trillion barrels of oil — up to three times the proven reserves of Saudi Arabia — are locked in rock in parts of western Colorado, Utah and Wyoming. Roughly 800 billion barrels are considered recoverable.

HuffPost



4 Comments on "Shell Abandons Oil-Shale Project In Colorado After Pumping Millions Into Exploration"

  1. rockman on Fri, 27th Sep 2013 7:21 pm 

    “The new oil plays in North Dakota and Texas and along Colorado’s Front Range, which are producing large quantities of oil, hurt the viability of oil shale, said Jim Spehar, former mayor of Grand Junction.” One more politician who is IMHO either too stupid to understand the obvious or too dishonest to admit it. The increase oil production in Texas and N Dakota is a result of high oil prices. I doubt Shell is walking away because oil prices have risen so much.

  2. rockman on Fri, 27th Sep 2013 7:48 pm 

    Actually unless I’ve missed a more recent update Shell isn’t giving up on the kerogen deposits but the other Colorado shale plays. From: http://www.bizjournals.com/denver/blog/earth_to_power/2013/08/shell-will-keep-oil-shale-rd-sell.html?page=all

    “Royal Dutch Shell’s U.S. subsidiary will keep its oil shale research project going in Colorado, but the company’s other assets in the northwestern and southeastern parts of the state are up for sale, according to the company. The company on Aug. 1 reported a 60 percent drop in second quarter results — largely due to a $2 billion write-down of its North American shale assets due to “the latest insights from exploration and appraisal drilling results and production information.”

    And now, so are Shell’s operations on southeastern Colorado, where it’s drilled a well in Huerfano County, Shell spokeswoman Deb Sawyer told me. “We’ve drilled one well and fracked it, and we’ll continue with our program while the assets are marketed,” she said.”

    It sounds like they dumping the more conventional unconventional fracture shale plays and not the kerogen deposits which have yet to produce $1 worth of profitable oil.

  3. BillT on Sat, 28th Sep 2013 3:41 am 

    Kerogen is a joke played on uneducated suckers. If they can wait a few million years, they may get a return on their ‘investment’. Otherwise, they are making a few shysters wealthy. But then, that is the name of the fraking game today.

  4. PrestonSturges on Sat, 28th Sep 2013 5:44 pm 

    Something like 10% of the western oil shale deposits are fairly good quality and about 60% are real crap. Not sure which ones these are.

Leave a Reply

Your email address will not be published. Required fields are marked *