Hydrogen and Carbon Oil Shale to Qualified Reserves

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Hydrogen and CarbonOil Shale to Qualified
Reserves

• James Langley
• Langley Associates LLC
• Sugar Land, Texas

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Definitionoil and gas producing activities

• include activities relating to the processing or
  upgrading of natural resources from which
  synthetic oil or gas can be extracted. However,
  the definition would continue to exclude
• Transporting, refining, processing (other than
  field processing of gas to extract liquid
  hydrocarbons by the company and the upgrading of
  natural resources extracted by the company other
  than oil or gas into synthetic oil or gas) or
  marketing oil and gas

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What is Synthetic Oil?

• Crude Oil
• Websters Collegiate pertaining to or denoting
  compounds, materials, etc., formed through a
  chemical process by human agency, as opposed to
  those of natural origin
• Anything you want it to be

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What is Synthetic Oil?

• Crude Oil API
• WTI 39
• Alaskan 29
• Bow River 24
• Lloydminster 22
• Bachequero 17
• San Joaquin 15

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Hydrocarbon Structure
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Hydrocarbon Structure

• Straight Chains
• Propane C3H8
• Rings
• Benzene C6H6

• Octane C8H18
• Naphthalene C10H8

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Proxy for Structure
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What is Shale Oil?
The Chemistry and Technology of Petroleum J G
Speight
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Processing Possibilities

• Carbon Rejection
• Historical favorite of refiners
• Lower capital
• Lower operating costs
• Favors gasoline yield
• Market for high sulfur petroleum coke
• Difficult for Oil Shale
• Far higher carbon content
• Markets favor diesel fuel
• Disappearing markets for coke

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Processing Possibilities

• Hydrogen Saturation
• Growing choice of refiners
• Yields favor diesel
• Simultaneously desulfurizes the product
• Capital cost is higher
• Operating costs are higher
• Requires other raw materials
• Hydrogen
• Water

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Conversion

• To Bachequero
• C10H3 7H ? C10H10
• 1 bbl of OIL ?? 2,900 cubic feet of hydrogen
• To Bow River
• C10H3 10H ? C10H13
• 1 bbl of OIL ?? 4,000 cubic feet of hydrogen

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Sources of Hydrogen

• Electrolysis
• Natural Gas? Steam / Electricity
• 2H2O ? 2H2 O2
• Inefficiencies due to re-association
• Fuel inefficiencies of power generation
• Useful if purity hydrogen is essential
• Nuclear energy may lower costs

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Sources of Hydrogen

• Natural Gas
• Methane CH4
• CH4 2H2O ? CO2 4H2
• Steam methane reforming
• Proven technology
• Platinum catalyst

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Sources of Hydrogen

• Carbon (coal or bitumen)
• Pure carbon C
• C 2H2O ? CO2 2H2
• Synthesis gas
• Proven technology (Germany, So Africa)
• Platinum catalyst

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Sources of Hydrogen

• Natural Gas
• CH4 2H2O ? CO2 4H2
• Carbon
• 2C 4H2O ? 2CO2 4H2
• Economics
• Price of Carbon
• Availability of Water
• CO2 Penalty

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Synthetic Bow River

• 1 Barrel of oil requires
• Hydrogen 4,000 cubic feet
• Derived from
• Natural Gas 1,000 cubic feet
• Water 11.5 gallons
• And you get
• Carbon dioxide 120 pounds for free !

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1 Billion Barrels

• Hydrogen 4,000 BCF
• Natural Gas 1,000 BCF
• Water 35,000 AF (270 MM bbls)
• Carbon Dioxide 60 million tons
  

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Lake Louise
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Evaporative Losseswould be additive
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Processing
100 Heavy Oil
Hydrogen
Hydrogen Saturation
Nat Gas
Sulfur
H2S
Water
110 Synthetic Oil
Carbon Dioxide
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Benefits

• Strategic Investment
• More diverse group of buyers for the oil
• Higher sales price
• Stable basis differential
• Controllable Operating Costs
• Natural gas reserves
• Water rights
• CO2 byproduct value
• Flexible Yields

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SEC and Intent

• other nonrenewable natural resources which are
  intended to be upgraded into synthetic oil or
  gas, and activities undertaken with a view to
  such extraction
• to include coal and oil shale that is intended
  to be converted into oil and gas as oil and gas
  reserves.
• Specific quality of shale oil
• Market decisions
• Capital and operating costs
• Development plan

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• Langley Associates LLC
• International Energy Consulting
• Refining, Transportation, Downstream
• Sugar Land, Texas
• JLangley001_at_gmail.com
• [phone]

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