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Oil sands venture is set to begin

Published: Wednesday, Sept. 19 2007 12:02 a.m. MDT

VERNAL — Utah is home to 24 billion-plus barrels of oil sand reserves. Much of those reserves lie in the Uintah Basin, one billion being located along Asphalt Ridge.

In 2008, Temple Mountain Energy will begin commercial production of 150 million barrels of proven oil reserves based on its pilot project located in Uintah County.

Larry Clynch, CEO of the Minnesota-based company that specializes in unconventional fuels, said Temple Mountain's innovative oil sands process development has proven technical solutions to tap into the vast domestic petroleum reserves lying idle just outside of Vernal on Asphalt Ridge.

"With the completion of design, engineering and economic evaluation, TME is ready to construct the first production module on the site in 2008 along side its pilot plant," said Clynch, who has 40 years of a wide range of experience in crude oil operations in both the United States and Russia, including pipelines and terminals.

Temple Mountain has been operating on two small-mine permits and its pilot plant since June on their leases seven miles south of Vernal. A large-mine permit is in the state approval process.

The pilot project has enjoyed tremendous success at the economic level by producing an array of products from the oil sands, as well as being environmentally sound, according to Clynch.

The pilot plant, expected to be in full operation by December, will process 100 tons of oil sands an hour. Starting next year, four production modules will follow — one every six months, capable of processing 250 tons of oil sands per hour each, working 20-hour days, for a full production capacity of 1,000 tons per hour.

Temple Mountain holds leases of 1,280 acres on Asphalt Ridge, where there are 150 million barrels of known oil sands reserves. The large-mine permit for the commercial mining operation covers 300 acres.

More than 80 million barrels are surface-mineable oil, said Clynch, with deposits are found at or just below the surface.

This is not the first continuous oil sands production in the United States, but it is the first of its size that uses technology that has its grounding in soil reclamation from difficult sites to process the oil sands.

The process involves separating oil from the sands through a highly technical system that employs water, vibration and flotation.

The process used by TME needs little or no heat or steam, thereby reducing cost. Water is used in a closed-loop system, which allows 85 percent to be recycled. The 15 percent loss is evaporation and water that is held by the resulting clean sand.

The low sulfur content in oil sands on Asphalt Ridge makes it even more desirable. Oil sands in Alberta, Canada, have high sulfur content.

The company's separation and reclamation process was designed by David Bower, who has spent the past 15 years designing, building and operating soil reclamation and cleanup projects in the global market, predominantly in Europe. These techniques have been used successfully in Europe for years.

"The Europeans are approximately 10 to 15 years ahead of us in the soil remediation industry because of the excessive environmental regulation," said Jim Runquist, a principal in Temple Mountain.

The commercial venture is of great importance, not only to TME's future in terms of economic success, technology development and production viability, but to the nation's future as it struggles to loosen the grip of dependence on foreign oil.

At its peak, the commercial plant will be able to produce 1,000 tons per hour of oil sands every hour. There is approximately half a barrel of bitumen oil per ton of oil sands. The recovery project has an estimated life span of 15 to 20 years.

While Temple Mountain is intent on helping the nation reduce dependence on foreign oil, they haven't put the proverbial eggs in one basket. "We didn't want to be locked into strictly the crude oil market," said Clynch. "We have a very good market for everything we can make."

Those products include:

• Raw oil sands ore. An estimated 400 billion tons are used mainly in roads and airport runways in the United States.

• Bitumen oil, used as a binder in asphalt pavement mix. Much bitumen oil used in the western United States now comes from Venezuela.

• Silica quartz sand, used as "frac sand" by the oil industry.

• Low-sulfur upgraded crude oil.


E-mail: lezleewhiting@hotmail.com

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