Pace Synthetic Fuels Report
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ioGo)9 Srntfletic fneis OIL SHALE a COAL 0 OIL SANDS 0 NATURAL GAS VOLUME 30- NUMBER 2- JUNE 1993 QUARTERLY Toll Ertl Repository ur Lakes Library School ef ;:?s © THE PACE CONSULTANTS INC. Reg. U.S. Pat. OFF. Pace Synthetic Fuels Report is published by The Pace Consultants Inc., as a multi-client service and Is intended for the sole use of the clients or organizations affiliated with clients by virtue of a relationship equivalent to 51 percent or greater ownership. Pace Synthetic Fuels Report is protected by the copyright laws of the United States; reproduction of any part of the publication requires the express permission of The Pace Con- sultants Inc. The Pace Consultants Inc., has provided energy consulting and engineering services since 1955. The company's experience Includes resource evalua- tion, process development and design, systems planning, marketing studies, licensor comparisons, environmental planning, and economic analysis. The Synthetic Fuels Analysis group prepares a variety of periodic and other reports analyzing developments in the energy field. THE PACE CONSULTANTS INC. SYNTHETIC FUELS ANALYSIS MANAGING EDITOR Jerry E. Sinor Pt Office Box 649 Niwot, Colorado 80544 (303) 652-2632 BUSINESS MANAGER Ronald L. Gist Post Office Box 53473 Houston, Texas 77052 (713) 669-8800 Telex: 77-4350 CONTENTS HIGHLIGHTS A-i I. GENERAL Energy Secretary Announces Oil and Gas Initiative i-I DOE's 1994 Budget Request Shows Shift in Priorities 1-1 ENERGY POLICY AND FORECASTS NERA Expects Real Oil Price of $30 in Year 2000 1-4 TECHNOLOGY Residue Upgrading Choices Multiply 1-6 INTERNATIONAL Biomass Gasification to be Tested in Sweden 1-9 U.N. Funds Biomass Gasification in Brazil 1-10 ENVIRONMENT EPRI Compares Global Warming Mitigation Strategies i-li COMING EVENTS i-is H. OIL SHALE PROJECT ACTIVITIES PAMA to Start Up Retorting Pilot Plant in 1994 2-1 Australian Election Results Are Good News for Oil Shale 2-1 NaTec to Focus on flue Gas Desulfurization Market 2-2 GOVERNMENT BLM Receives Three Expressions of Interest in White River Property 2-3 TECHNOLOGY Shale Oil Tested as Source for Carbon Fibers 2-4 - Geokinetics Tested Rocket Fuels to Create horizontal Fracturing 2-5 SYNrHETIC FUELS REPORT, JUNE 1993 INTERNATIONAL Former Shale Oil Refinery in China Now Important Wax Producer 2-8 Luxembourg Oil Shale Described 2-8 Russian Technology Proposed for Shale-Fired Powerplants in Israel 2-10 JOSECO Pilot Plant Designed Elaborated 2-10 Oil Shale Ash Finds Use as Fertilizer in Estonia 2-12 WATER Arizona May Fight Plan to Lease Oil Shale Water Rights to Nevada 2-14 U.S. FWS to Designate Critical Habitat for Colorado River Fish Species 2-14 RESOURCE Oil Shale Reserves to be Assessed for Oil and Gas Potential 2-17 STATUS OF OIL SHALE PROJECTS 248 INDEX OF COMPANY INTERESTS 2-34 III. OIL SANDS PROJECT ACrIVI11ES • Imperial Will Put Phases l and S in Operation at Cold Lake 3-1 Startup of Bi-Provincial Upgrader Described 3-1 Suncor Sets Record, Awards Contracts 3-3 CORPORATIONS Sun Notes Decline at Suncor in 1992 3-5 Gulf Canada Notes Oil Sands Holdings 35 Ontario Sells Suncor Stake 3-7 ECONOMICS Bitumen Supply Costs From IJTF Projected to be Less Than $10 Per Barrel 3-8 Mobile Equipment Found Most Economical for Canadian Oil Sands Mining 3-11 TECHNOLOGY Top-Down In Situ Combustion Process Revealed 3-15 Whiterocks Oil Sands Pyrolysis Liquid Yield Improved 3-17 Synthetic Crude Offers Advantages to Refiners 3-19 Asphaltenes Rejected From Bitumen By Supercritical Extraction 3-21 Freeze/Thaw Disposal System Proposed for Fine Tailings 3-23 Emulsified Bitumen Vacuum Bottoms Proposed as New Fuel Product 3-26 Coprocessing of Bitumen and Coal Yields High Quality Liquids 3-27 Hydrotransport a Key Technology at Syncrude 3-28 INTERNATIONAL Production and Upgrading Projects Proposed for Orinoco Tar Belt 3-32 Orintulsion Passes 3 Million Tonnes, Reaches for New Markets 3-32 SYNTHETIC FUELS REPORT, JUNE 1993 WATER OSLO'S New Extraction Processes Reviewed 3-34 RESOURCE Heavy Oil Now Accounts for 70 Percent of Production in California 3-38 Uinta Basin Oil Sand Bitumens Characterized 3-40 OIL SANDS PUBLICATIONS/PATENTS 3-42 STATUS OF OIL SANDS PROJECTS 345 INDEX OF COMPANY INTERESTS 3-71 IV. COAL PROJECT ACTIVITIES Great Plains Makes Profits and Progress 4-1 Amax Running 5-Ton-Per-Hour Briquetting Plant 4-2 Testing Completed on TRW Molten Caustic Leaching Process 4-4 West Virginia IGCC Project Dies 4-5 CORPORATIONS Gasification Research Continuing at EERC 4-6 GOVERNMENT DOE Updates Status of Clean Coal Technology Program 4-8 New Funding Provided for British Clean Coal Research 4-12 Energy Policy Act Provides Large Incentives for Coal Upgrading 4-12 Clean Coal Round V Winners Announced 4-13 DOE Defines Strategy for Indirect Liquefaction Research 4-14 ECONOMICS Gasification Combined Cycle Seen More Economic Than Natural Gas Soon After 2000 4-17 Coal Gasification With Molten Carbonate Fuel Cells Approaching Competitive Position 4-19 Critical Costs Delineated for Alcohol Fuels From Coal 4-20 TECHNOLOGY Fullerenes Made Directly From Coke 4-24 Mild Pre-Treatment Improves Liquefaction Reactivity 4-25 Transmission Electron Microscopy Sheds Light on Gasification of Brown Coal 4-27 PyGas Process Described 4-28 Petroleum Coke Makes Good Feedstock for Texaco Gasifier 4-29 Hopes are High for Molten Carbonate Fuel Cells 4-31 INTERNATIONAL China to Study SGI Process 4-33 International Gasification Projects Proliferate 4-33 SWIM IE'FIC FUELS REPORT, JUNE 1993 lii RLA HIIXLU l Canadian Coal Mining Not a Big Factor in Global Methane Emissions 4-37 COAL PUBLICATIONS/PATENTS 4-38 STATUS OF COAL PROJECTS 4-43 INDEX OF COMPANY INTERESTS 4-92 V. NATURAL GAS PROJECT AC1'IVfl'IES Mossgas Achieves Commercial Status 5-1 Shell MDS Plant Starts Up in Malaysia 5-3 CORPORATIONS Mobil Sells Its Share of New Zealand Synfuels 5-7 TECHNOLOGY Enon Gas Conversion Process Ready for Commercialization 5-8 RESOURCE NPC Report Estimates U.S. Gas Potential at 1,300 Trillion Cubic Feet 5-11 STATUS OF NATURAL GAS PROJECTS 5-15 SYNTHETIC FUELS REPORT, JUNE 1993 iv Capsule Summaries of the More Significant Articles In this Issue NERA Expects Real Oil Price of $30 In Year 2000 According to National Economic Research Associates, Inc., the real price of oil is expected to average $19 to $22 per barrel through the mid-1990s but will move up to $30 per barrel by the end of the century. NERA's forecasts for the gas market and the impact of President Clinton's proposed BTU tax are also discussed in the article on page 14. Residue Upgrading Choices Multiply Refiners now have a wide variety of processes available to decrease the amount of high-sulfur li- quids produced during residue upgrading. New technology developments have shown significant improvements in the economics for converting residues. The article on page 1-6 summarizes these developments. Biomass Gasification to be Tested in Sweden A demonstration plant, based on Bioflow Ltd.'s IGCC technology which uses biomass as fuel, is scheduled for startup in the City of Varnamo, Sweden this spring. As outlined on page 1-9, the plant will use forest and sawmill wastes to generate 6 megawatts of electricity and 9 megawatts heat for the city heating system. Australian Election Results Are Good News for Oil Shale The March Australian national election results, which returned the Labor Party to office, were good news for Southern Pacific Petroleum and Central Pacific Minerals. The apparent survival of the excise tax exemption for shale-derived gasoline, along with last year's tax ruling allowing the first stage of the project a 150 percent tax deduction on much of Stuart's capital spending, increase the chances for a successful project demonstration. The impacts of the election results are further discussed on page 2-1. Shale Oil Tested as Source of Carbon Fibers The use of the asphaltene fraction of oil shale residue as a precursor for the synthesis of advanced carbon fibers is summarized on page 24. Single-filament carbon fibers and activated carbon fibers were successfully produced by spinning, oxidative stabilization, carbonization and activation. In comparison with carbon fibers derived from petroleum pitch, differences in morphology and reac- tivity were observed. Arizona May Fight Plan to Lease Oil Shale Water Rights to Nevada The State of Arizona may challenge the Roan Creek project, which would lease upper Colorado River water rights from Chevron OR Shale Company and Getty Oil Exploration Company to Las Vegas, Nevada. The plan has also drawn fire from other states, as discussed in the article on page 2-14. A-i USF&WS to Designate Critical Habitat for Colorado River Fish Species The United States Fish and Wildlife Service proposes to designate 2,094 miles of critical habitat for four species of Colorado River Basin fishes, listed as endangered under the Endangered Species Act. The areas under consideration are identified on page 2-14. Public comments on the proposal were accepted until April 15. Imperial Will Put Phases 7 and 8 in Operation at Cold Lake Imperial Oil Limited plans to put Phases 7 and 8 of its Cold Lake oil sands project into operation. Bringing the two phases onstream will add 19,000 barrels of heavy crude oil to Cold Lake's current production of 85,000 barrels per day. See page 3-1 for details. Startup of RI-Provincial Upgrader Described Last November, the Bi-Provincial Upgrader syncrude facility near Lloydminster, Saskatchewan, Canada officially opened. The upgrader has the capacity to produce about 46,000 barrels of syn- thetic crude oil per day.