A Canada-based company has begun commercial production of oil from oil sands in a Utah facility near the Colorado border west of Rangely and has begun delivering it to market.
Petroteq Energy, formerly MCW Energy Group, has built a facility at Asphalt Ridge outside Vernal and is using what it says are benign solvents to produce oil from oil sand deposits. The company says its approach uses no water, produces no waste or greenhouse gas and doesn't require high temperatures.
It is working to ramp up production to the plant's capacity of 1,000 barrels a day.
The company said this month it received a small-source exemption from the Utah Division of Air Quality for its facility, allowing it to begin sales. It said in a news release that it got the exemption because the plant's estimated emissions are less than the level for which a permit is needed, "further confirmation that Petroteq's process is an environmentally conscious method of oil extraction."
Oil sands are also known as tar sands or bituminous sands, and contain a heavy oil also described as asphalt or bitumen.
Petroteq says its leases have 93 million barrels of estimated oil resource. Eastern Utah is home to the largest oil sands resources in the country, with resource estimates running as high as 32 billion barrels.
Calgary-based US Oil Sands had been trying to finish the start-up of a plant in the PR Spring area north of Interstate 70 in far-eastern Utah but that project ended up in receivership under Canadian bankruptcy and insolvency law in 2017. That project would have used a citrus-based solvent to produce oil from oil sands.
Petroteq's project is at Asphalt Ridge, which the federal Bureau of Land Management has reported has been the target of oil/tar sand exploration and development efforts as early as the 1920s, when Vernal paved its streets from Asphalt Ridge deposits.
Work there included a plant that used hot water to extract oil in the 1930s. Hot water also is used in Canadian tar sands development that also incorporates tailing ponds. "Our 'Asphalt Ridge' asset has (from time to time) caught the attention of major oil companies going back 70 years. But nobody has been able to unlock its resources in a financially sound and environmentally friendly manner until the Petroteq team and its proprietary technology came along," David Sealock, Petroteq's chief executive officer, said in a recent news release announcing the company's start of commercial production.
The company says its focus is on development and implementation of proprietary technologies for environmentally safe production of heavy oil from oil sands, oil shale and shallow oil deposits. Northwest Colorado and northeastern Utah are home to world-class deposits of oil shale, rock containing kerogen-like hydrocarbon deposits.
The efforts of companies like Petroteq continue to be criticized by groups including Utah Tar Sands Resistance, which says on its website, "The production of tar sands in Utah is a story of false claims and impossible promises with a long history of failed companies, bankruptcies and name changes."