Utah firm plans oil-shale operations this summer
A Utah company plans to begin commercial-scale production of oil shale this summer in the Uintah Basin on state lands.
Red Leaf Resources Inc. plans to dig up shale, place it into a clay-lined pit and heat it to release kerogen, a petroleum-like substance that can be refined for use as a transportation fuel.
The work that will begin this year will be the first toward a goal of continuous production of up to the equivalent of 10,000 barrels of oil per day in 2015, Red Leaf CEO Adolph Lechtenberger said in a statement.
Red Leaf in November tapped Lechtenberger, a chemical engineer with a background in management in the energy industry, to head up the company’s efforts to begin commercial production.
Red Leaf will begin construction of the first of the cells it will use in its proprietary process, called Ecoshale In-Capsule technology, to boil the rock to release kerogen.
“It’s a careful and deliberate process” to excavate shale to form the capsule, which will be lined top and bottom with bentonite clay, said Jeff Hartley, Red Leaf spokesman.
It will take longer to construct the first cell as the company completes testing to make sure heat will flow through the commercial-size cell as it did in research and in a 2009 field test, Hartley said.
It will take some months to complete the first cell, which will be larger than a football field and 120 feet deep. Red Leaf anticipates filling the capsule with crushed shale in the June–July time period and beginning the six- to eight-month heating process, Hartley said.
A network of pipes will collect the kerogen, and the heated rock will be left in place after the process is complete.
Red Leaf already is hiring engineers and others for what Hartley said will be a “constant construction phase” as cells are continually built.
The project will employ as many as 300 people, depending on cell-construction and production activities.
Uintah County has a 3.6 percent unemployment rate, largely a result of the thriving energy industry, Commissioner Mike McKee said.
“We see oil shale as something that can be developed responsibly,” McKee said, noting that modern techniques require far less water than previous development efforts.
Approaches such as Red Leaf’s technology are geared to Utah’s oil shale deposits, which lie relatively close to the surface.
Colorado’s far richer deposits are deeply buried. Research is being done in Colorado to remove kerogen without disturbing the surface.
At one of the Colorado projects, American Shale Oil Co. has dropped a heater down below a deposit with the hope of heating the shale to release kerogen, which would be collected using conventional drilling methods.
“It’s in and we’re right in the midst of start-up,” Vice President Roger Day said.
American Shale Oil is backed in part by Total, the French petroleum giant, which also is involved in the Red Leaf effort.
Red Leaf’s project differs from research efforts in Colorado in that it’s being pursued on state school-trust and private lands. The Colorado research programs are being conducted on federal lands.
“We intend to provide quite a bit of revenue to the school districts of Utah through our revenues,” Hartley said, noting that Utah officials have worked hard to aggregate holdings of lands overlaying oil shale.
Red Leaf holds 18 mineral leases for some 17,000 acres in the basin, which has an average of 25 gallons of the equivalent of crude oil per ton, and as much as 70 gallons per ton in some locations.
It’s estimated Red Leaf’s leases contain the equivalent of about 1.5 billion barrels of oil.