230(.00I pace Srntfletic fneis report OIL SHALE 0 COAL 0 OIL SANDS VOLUME 27 - NUMBER 1 - MARCH 1990 QUARTERLY ThU Eril Repository A:iur Las Library CJo:ado School of Mirics © THE PACE CONSULTANTS INC. ® Reg. U.S. Pot. 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 Post Office Box 649 Niwot, Colorado 80544 (303) 652-2632 BUSINESS MANAGER Horace 0. Hobbs Jr. Post Office Box 53473 Houston, Texas 77052 (713) 669-7816 Telex: 77-4350 CONTENTS HIGHLIGHTS A-i I. GENERAL CORPORATIONS Worldwide Synthetic Fuels Projects Listed i-i GOVERNMENT Energy Department Implements Task Force Report on Science and Engineering 1-2 Appointments on United States Alternative Fuels Council Announced 1-2 Bush's 1991 Budget Request for DOE is Unkind to Synthetic Fuels 1-2 ENERGY POLICY AND FORECASTS ISA Sees no Justification for Enhanced Production of Alternative Fuels 1-6 EIA Outlines Long-Term Energy Outlook 1-7 CR1 Predicts Imported LNG to Satisfy Future Gas Supply Shortfall 1- Cl API Calls for Balanced Energy Strategy 1-15 National Energy Plan Urgently Needed Says NCA 1-16 Merrill Lynch is Bullish on Energy 1-17 Battelle Forecasts Drop in Energy R&D Expenditures for 1990 1-17 ECONOMICS Marrow Analyzes Uncertainties of Synthetic Fuels Type Projects 1-19 TECHNOLOGY Skygas Gasifier Works on Variety of Carbonaceous Materials 1-21 INTERNATIONAL DOE Team to Visit Soviet Union 1-22 NEDO Program Maintains Momentum 1-22 ENVIRONMENT ADD Will Support Environmental Considerations in Energy Development 1-27 COMING EVENTS 1-28 SYNTHETIC FUELS REPORT, MARCH 1990 II. OIL SHALE PROJECT ACTIVITIES SPP/CPLI Outline Stuart Development Plans 2-1 Unocal Achieves Nev Production Record in November 24 Occidental Staffs Up for MIS Demonstration Project 2-4 Western Slope Refining Suspends Operations 2-5 Rundle Project Studies Continuing at Low Level 2-5 CORPORATIONS Water-Jet-Assisted Mining Demonstration Moved to Unocal Mine 2-7 SPP/CPM Continuing Broad Based Oil Shale Research 2-7 GOVERNMENT Bush 1991 Budget Request Again Guts DOE OH Shale Program 2-9 ECONOMICS FBI) Finds Power Generation not Economical for 2,000 BPD Plant 2-10 Economic Benefit Seen for Integration of LLNL Retort with MIS Project 2-14 TECHNOLOGY Microwave Retorting of Australian Shales May Show Promise 2-17 USBU Summarizes Fire and Explosion Hazards of Oil Shale 2-18 Column Flotation Proves Effective for Alabama Oil Shale 2-22 Paving Quality Bitumen Produced from Rundle Shale Oil 2-24 Exxon Patents Arsenic/Selenium Removal Method for Shale Oil 2-26 Union Oil Patents Shale Oil Dewaxing Process 2-27 INTERNATIONAL Retorting Assay Methods Compared for World Oil Shales 2-29 WATER NaTec Files for Due Diligence on Water Rights 2-33 RESOURCE Oil Shale Land Patent Processing on Hold as ELM Waits for Congressional Action 2-34 Exxon Sells Battlement Mesa 2-36 Unocal Wins Battle Over Tax Refund 236 RECENT OIL SHALE PUBLICATIONS/PATENTS 2-37 STATUS OF OIL SHALE PROJECTS 2-40 INDEX OF COMPANY INTERESTS 2-55 ii SYNTHETIC FUELS REPORT, MARCH 1990 III. OIL SANDS PROJECT ACTIVITIES OSLO Environmental Review Agreement Reached 3-1 Solv-Ex Buys Lease Interest 3_1 AOSTR4 Plans to Extend UTF Program 3-1 Recent Oil Sands Orders and Approvals Listed 3-2 CORPORATIONS UFJITAR/UNDP Centre for Heavy Crude Restates Mission 3-4 AOSTRA Technology Program Summarized 3-4 GOVERNMENT Change In Alberta Lease Procedures Could Force Oil Sands Developments 3-7 DOE Signals Shift in Oil and Gas Research Program 3-7 Horizontal Drilling Forces Changes in Regulatory Procedures 3-8 Bush 1991 Budget Again Eliminates All Tar Sands Funding 3-10 ENERGY POLICY & FORECASTS ERCO Chairman Calls for Continued Oil Sands Research Efforts 3-11 CHOA Sees Nineties as Difficult Challenge for Heavy Oil Development 3-11 ECONOMICS - Bright Economic Outlook Seen for heavy Oil in the 1990s 3-13 TECHNOLOGY Inclined Plate Process for Froth Cleaning Patented 3-16 In Situ Hydrogenation Proposed for Heavy Crudes 3-18 Beneficiation of Alabama Tar Sands Tested 3-20 Air Injection Increases Bitumen Recovery in Hot Water Flood 3-22 Oil From Wolf Lake Fireflood Shows Improved Quality 3-25 INTERNATIONAL Alberta Oil Sands Development Could Point the Way for Australian Oil Shale 3-28 ENVIRONMENT Possible Actions to Limit the Greenhouse Impact of Oil Sands Bitumen Listed 3-30 RESOURCE Heavy Oil Potential of Southwest Missouri Delineated 333 RECENT OIL SANDS PUBLICATIONS/PATENTS 3-36 STATUS OF OIL SANDS PROJECTS 3-37 INDEX OF COMPANY INTERESTS 3-61 Iii SYNTHETIC FUELS REPORT, MARCH 1990 IV. COAL PROJECT ACTIVITIES DOE Drops Energy International's UCG Project 4- Another CCT Round I Gasification Project Expires 4-1 SheII/SGl Project Wins Clean Coal Round 3 Funding 4-1 Great Plains Finishes First Year Under Private Ownership 4-2 CORPORATIONS PAZ Corporation Studying Flash Pyrolysis in Vibrating Bed 4-3 Coastal Subsidiary Set to Manage Coal Gasification Plants 4-3 New Group Formed to Market K-Fuel 4-3 New Coal Slurry Transport System to be Tested 4-4 Full-Scale 10CC Plant Based on Texaco Gasifier Planned in Massachusetts 4-4 EPRI to Study Opportunities for Coal Gasification Coproduction 4-5 GOVERNMENT Meetings Held to Prepare for Next Round of Clean Coal Competition 4-6 Thirteen Winners Announced in Clean Coal Round 3 4-6 DOE Solicits New Directions in Liquefaction HAD 4-0 Energy Department Receives Proposals for 11th Year of Coal Grant Program 4-8 ENERGY POLICY AND FORECASTS U.S. Coal Production and Consumption will Hit t Billion Tons in 1990, Says NCA 4-10 AGA Forecasts Adequate Gas Supplies Without Coal Gasification 4-11 ECONOMICS Estimated Cost of Producing Jet Fuel at Great Plains Increases 4-16 New LOP Catalyst 10 Times as Active, Lowers Syncrude Production Costs 4-19 TECHNOLOGY Coal Liquids Tested as Jet Fuel for Supersonic Aircraft 4-22 Coal Liquefaction Demonstrated Using Supercritical Water 4-24 Filtration Said Key to British Coal LSE Process 4-25 Transport Mode Hybrid 10CC System Described 4-26 INTERNATIONAL Two-Stage Pyrolyzer/Gasifier Tested In China 4-29 Brazil's CIENTEC Studying Desulfurization During Coal Gasification 4-30 Plans Laid for Entrained Flow IGCC Demonstration in East Germany 4-31 Proposal Presented for Future European UCO Development 4-33 RESOURCE DOl Proposes New Regulations for Coal Product Value 4-36 DOl Sets Eight Percent Federal Royalty on Underground Coal 4-36 Powder River RCT Votes to Decertify; to Meet In April 4-36 RECENT COAL PUBLICATIONS/PATENTS 4-38 STATUS OF COAL PROJECTS 4-42 INDEX OF COMPANY INTERESTS 4-89 IV SYNTHETIC FUELS REPORT, MARCH 1990 the More Significant Articles in this Issue Appointments to United States Alternative Fuels Council Announced The recent appointment of sixteen members to the Alternative Fuels Council includes representatives from both private and public sectors. As explained on page 1-2, the Council is an advisory body to the Interagency Commission on Alternative Motor Fuels. 1991 Budget Request for DOE is The 1991 budget request prepared by Energy Secretary J. Watkins strongly de- emphasizes synthetid fuels In the nation's energy program. His proposed budget, outlined on page 1-2, calls for increases in environmental spending and renewable energy and strengthening national defense. Sees No Justification for Enhanced Production of The International Energy Agency sees no Immediate justification for enhanced synthetic fuels production because of the uncertainty of alternative fuels sub- stitution occurring. If, for example, there are continuing low cost oil dis- coveries, there would be no "window" for alternative fuels. Rather, the problems of hydrogen or electric vehicles may be overcome before oil produc- tion drops off, resulting in a transition directly to these technologies. For lEA's assessments and conclusions please see page 1-6. EtA Outlines Long-Term Energy Outlook The Energy Information Administration's Annual Energy Outlook 1990 is a year projection of United States energy trends. According to the report, imports will increase by at least 60 percent by 2010 and oil prices steadily rise beginning in the early 1990s. A complete synopsis of the forecast can be found beginning on page 1-7. GRI Predicts Imported LNG to Satisfy Future Gas Supply Shortfall The Gas Research Institute's annual Policy Implications of the GRI Projection of U.S. Energy Supply and Demand to 2010 says that gas have a strong role even if prices remain low. Some of the demand, will be filled by LNG imports, especially in a low price scenario. report is summarized beginning on page 1-13. National Energy Plan Urgently Needed Says Testifying at the Department of Energy's National Energy Strategy Hearing, R. Lawson of the National Coal Association called for a multi-faceted plan that would help the United States achieve energy independence. In his tes- timony, outlined on page 1-16, Lawson made several recommendations for a na- tional energy strategy that would utilize all domestic resources and provide for their conservation.