Shell is going to the wall for oil
The company is spending $30 million to make a huge underground "freeze wall" to safeguard oil-shale reserves in the region.
By Steve Raabe
Denver Post Staff Writer
Article Last Updated:10/22/ 2006 04:56:15 PM MDT
Piceance Creek - In an arid, sage-dotted valley here, Shell
Exploration & Production Co. has begun work on what could be the final technological challenge to large-scale production of oil from shale.
Shell already has figured out how to melt kerogen - the oil-like substance - from underground shale deposits with electric heaters to produce oil from one of the world's largest potential petroleum sources.
Oil-shale deposits in Colorado, Utah and Wyoming have technically recoverable reserves of 500 billion to 1.1 trillion barrels of oil, according to a study last year by the Rand Corp. for the Department of Energy.
The midpoint of the Rand estimate - 800 billion barrels - is three times the size of Saudi Arabia's reserves and enough to meet 25 percent of current U.S. oil demand for 400 years.
Eager to tap into that possibility, Shell is spending $30 million to create and test a massive "freeze wall" that would extend from the surface to 1,700 feet below the ground. The walls would be 30 feet thick in a shape 300 feet wide by 350 feet long.
It is designed for a dual purpose: to keep groundwater from
infiltrating Shell's oil-shale wells, and to prevent produced oil from contaminating nearby groundwater.
"We see this as our last major technological hurdle," said Terry O'Connor, a Denver-based Shell vice president in the company's unconventional resources division.
Shell already has tested a small-scale version of the freeze wall at its Mahogany research facility in the Piceance Basin of western Colorado.
A crew of 200 construction workers will complete the larger freeze wall in the spring by drilling a series of 150 well bores that will be pumped full of ammonia-based coolant. It will take about 18 months for the adjacent water and rock to freeze to minus-60 degrees Fahrenheit, creating the massive ice wall.
Shell then will intentionally try to crack the wall with air and water pressure, testing its strength and assessing how it can be repaired if breached.
Perfecting the technology ultimately could lead Shell to commercial production of shale oil on 40,000 acres it owns in the Piceance Basin and thousands more acres it may lease from the federal government. Commercial production is unlikely to begin until 2015.
Yet technology is just one challenge faced by Shell and other
prospective shale developers as they prepare to launch a major
industry. Social impacts from potentially thousands of new workers and demands on water and energy resources leave some local residents wary.
Western Colorado communities suffered severe and long-lasting
economic damage when the shale industry temporarily boomed then went bust in the early 1980s. |
