Is Kerogen the new Petroleum?

New technologies and research have once again provided more options for energy alternatives, such as oil shale. Previously, shale was extremely inaccessible and would cost any harvester more money than it would make, even in the face of rising petroleum and crude oil prices. In the face of current economic circumstances, shale will still fail to profit any present day harvesters; however, as crude oil plummets in supply, it will be necessary to make the shift to shale oil.

Shale is used to produce Kerogen, which is harvested from sedimentary rocks [1]. Companies extract the kerogen from the rocks by using extreme heat, which is costly due to the high energy required. Shale oil and crude oil are comparable in almost every way except price (of sale and production). Both resources require extensive drilling and exhibit and similar caliber impact on the environment; however, the price difference between shale and crude oil discourages some companies, such as Shell, from harvesting it [2]. The energy density of petroleum is 5.8 million BTU per bbl, which is common knowledge. In contrast, the energy density of shale oil has not been solidified. Using new technology, Shell expects shale oil to return 3-4 energy units for every energy unit consumed in harvesting [3].

Since kerogen and petroleum are both primarily comprised of saturated hydrocarbon chains, they are readily interchangeable for most applications. Given this versatility, big name companies such as Exxon have begun investing in its research and development [4]. Given the need for alternative energy, political figures such as President Obama have begun to advocate for advances in technologies such as shale oil [5]. Given the current circumstances, it will not become economically advantageous for companies to invest in shale oil until crude oil runs completely dry. In the meantime, engineers will be working towards stabilizing shale oil as a safe and reliable alternative to petroleum.

[1] – http://www.glossary.oilfield.slb.com/Display.cfm?Term=kerogen

[2] – http://www.washingtonpost.com/business/shells-us-focus-shifts-to-oil-shale-from-nat-gas/2012/02/02/gIQAzLorjQ_video.html

[3] – http://www.blm.gov/pgdata/etc/medialib/blm/co/field_offices/white_river_field/oil_shale.Par.79837.File.dat/OSTPlanofOperations.pdf

[4] – http://seekingalpha.com/article/175771-the-difference-between-oil-shale-and-shale-oil

[5] – http://thehill.com/blogs/congress-blog/energy-a-environment/208099-oil-shale-a-vast-resource-that-cant-be-dismissed

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2 Comments

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2 responses to “Is Kerogen the new Petroleum?

  1. Kerogen, by definition, is the solid organic matter that has indefinite composition.It’s more like a polymer or mineraloid. Kerogen is the main required source in the rock that generates petroleum, by the process of gradually losing it’s hydrogen and oxygen content. You can actually say that all the oil and gas are all sourced and generated from different types of kerogen. By this kind of definition, which you can find in most Petroleum Geology textbook. I think it would be better to say in title that “Is the kerogen shale (oil shale) the new petroleum?”
    The idea of heating oil shale using the technology from mining industry is really interesting. The in-situ conversion process that Shell proposed using “freeze wall” is described some here (http://ostseis.anl.gov/guide/oilshale/).
    From what I’ve heard in either AAPG annual meeting or some regional conferences, Shell Oil has been developing and testing this technology for over 20 years. It looks pretty promising for the future development. Once the oil price climbs up more and reach record-high, Shell might start to heat these oil shale (kerogen shale) and produce oil. However, local people and environmentalist have also been saying that this technology still has potential risk to contaminate the important water resource – the Colorado River, which if it’s true, will affect many southwestern states who use Colorado River as their water resources.

    • mikemurp

      It’s interesting to think how far we’ve come in our search for new oil sources. Perhaps it’s not so surprising to find we’ve run through most of the easy to develop oil fields when you realize oil production in the United States predates the civil war. And yet there are still substantial reserves yet to be tapped in the form of oil shale (kerogen based) deposits that could stand in as “the new petroleum”. Estimates suggest anywhere from 3 to 8 trillion BOE of kerogen lay in oil shale deposits spread across 30 countries worldwide. Of this some 2 trillion barrels are located in high quality oil shale reservoirs within the continental U.S. (1) Still oil shale production is minute with less than 50 MMBOE produced annually worldwide. Indeed most of the giant oil producers today have very few if any active oil shale operations, leaving Estonia to claim the title as world leader in oil shale production. (2) While Estonia needs this resource to keep the lights on (some 95% of electric power in Estonia is generated from oil shale) the rest of the world has far cheaper alternatives. (3)
      Unlike traditional oil sources Kerogen deposits are relatively young and have yet to be buried deep enough to experience the high temperatures and pressures needed to convert the material into a marketable fuel. Oil shale producers must cook the Kerogen themselves to transform the rock into crude. This prohibitively expensive step has kept production to a minimum. The most economically attractive solution appears to be in-situ heating of the reservoir to cook the rock while it’s still in the ground. After the kerogen has been heated adn liquid has formed it can be produced much like traditional hydrocarbons. (1) This comes with its own set of problems. Kerogen deposits are very shallow many lying at the same depth as aquifers. There’s a significant risk of aquifer contamination in such cases. As lucyko points out Shell has come up with an interesting solution. By drilling wells all along the periphery and injecting chilled fluid a wall of ice is created to prevent reservoir fluids from contaminated outside aquifers. This is an incredibly involved process. Whereas in traditional fields all you really needed was a producer now you need a large set of wells to create a freeze wall. A second set of wells to heat the reservoir and a third set of wells to produce the oil. Then after production ceases a 10 year reclamation process must be undertaken before the freeze wall can be allowed to thaw. (4) This all adds up to a very expensive process.
      I think it’s clear that the economic and environmental concerns are rather significant and that a large oil price will be necessary before commercially scaled operations can be profitably undertaken. That said the day demand outstrips daily production limits from more traditional sources may be sooner than you think. Given the inelasticity of oil demand it’s not too far a stretch to imagine significant increases in oil price even as we continue to produce large volumes of crude. With such huge untapped kerogen deposits distributed throughout the world oil shale may very well be the shape of things to come.

      (1) Biglarbigi, K., Dammer, A., Cusimano, J., & Mohan, H. (2007, November 11). Potential for oil shale development in the united states. SPE, SPE Annual Technical Conference and Exhibition, Anaheim, California, U.S.A. doi:10.2118/110590-MS

      (2) Brendow, K. (2003). “Global oil shale issues and perspectives. Synthesis of the Symposium on Oil Shale. 18–19 November, Tallinn” (PDF). Oil Shale. A Scientific-Technical Journal (Estonian Academy Publishers) 20 (1): 81–92. ISSN 0208-189X. Retrieved 2007-07-21.

      (3) (PDF) Estonian Energy in Figures 2005. Ministry of Economic Affairs and Communications. 2006. Retrieved 2007-10-22.

      (4) Shell Frontier Oil and Gas Inc. (2006, February 15). Plan of Operations:Oil Shale Test Project.

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