But an updated version may be required if Harold Vinegar and his colleagues get their way. Dr Vinegar, the former chief scientist of Royal Dutch Shell, is at the centre of an ambitious project to turn Israel into one of the world's leading oil producers.
Israel Energy Initiatives, where Dr Vinegar is chief scientist, is working on projects to extract oil and natural gas from oil shale from a 238sq km area of the Shfela Basin, to the south and west of Jerusalem.
Oil shale mining is often frowned upon, not least by the environmental lobby, as a dirty process that is both energy and water-intensive. IEI believes that its technique will be cleaner than that of other operators because the oil will be separated from the shale rock up to 300m beneath the ground. Water will be a by-product of the process rather than being consumed by it in large volumes.
According to Dr Vinegar, Israel has the second-biggest oil shale deposits in the world, outside the US: "We estimate that there is the equivalent of 250 billion barrels of oil here. To put that in context, there are proven reserves of 260 billion barrels of oil in Saudi Arabia."
The marginal cost of production, IEI estimates, will be between $US35 and $US40 per barrel. This, Dr Vinegar points out, is cheaper than the $US60 or so per barrel that it costs to extract crude from inhospitable locations such as the Arctic, and compares with $US30-$US40 per barrel in some of the deepwater oilfields off the coast of Brazil.
"These Israeli deposits have been known about, but have never been listed before. It was previously assumed there was not the technology to deal with it."
According to Dr Vinegar, IEI, which is owned by the American telecoms group IDT Corp, hopes to begin production on a commercial basis by the end of the decade, with a view to producing 50,000 barrels per day at the outset. This would be a fraction of the 270,000bpd consumed daily by Israel, but would be a significant step towards making the country energy-independent.
Dr Vinegar estimates that, with one barrel of oil comprising 42 gallons, each tonne of oil shale contains approximately 25gallons.The extraction process involves heating the rock underground, using electric heaters, to approximately 325C, the level at which the carbon-carbon bonds in the rock start to "crack". The oil produced by the process is light and easily refined to a range of products, including naphtha, jet fuel and diesel.
The project is attracting serious interest from outside investors. In November, 2010, an 11 per cent stake in Genie Oil & Gas, the division of IDC that is the parent company of IEI, was acquired for $US11m ($11.05m) by Jacob Rothschild, the banker, and Rupert Murdoch, chairman of News Corporation, parent company of The Times. Genie's advisory board includes heavyweight figures such as Michael Steinhardt, the hedge fund investor, and Dick Cheney, the former US vice-president.
Dr Vinegar said that an appraisal now under way would be followed by an 18-month pilot stage. Among the issues this will address will be concerns raised by environmental groups, including an examination of IEI's claims that the process does not require excessive use of water or energy. Reassurance will also be sought that a local aquifer, which is several hundred metres below the shale deposits, will not be contaminated by the work.
Assuming that these early stages are completed successfully, a demonstration phase would then take place over three to four years, during which the work completed in the pilot phase would be continued on a larger scale. Only then would the commercial operations begin. Dr Vinegar said that, by this stage, up to 1000 people would be employed on the project, many of them specialist engineers from outside Israel.
He added: "Funding is not needed for the pilot and demonstration, although once we were getting to 50,000 barrels per day, we would want to have a partner. We have been approached by all the majors."
Dr Vinegar said that the project still faced a number of hurdles: "There is a geological risk: Is the resource there? What is the risk to the aquifer? We have no doubts here, and in particular that the resource is there and is of good quality, but the pilot can prove these things.
"Then there is the technological risk: Can we drill long horizontal wells and can the heaters be placed in them? And can they last?
"And finally there is the economic risk, what the price of oil does. But I think the price is going to continue rising, to the extent that, by 2030, we will be at around $US200 per barrel."
To that, there can be added a fourth potential risk for the project: whether it is capable of overcoming criticism from the environmental lobby to win popular support. This, perhaps, is the greatest challenge facing Dr Vinegar and his colleagues.
Tuesday, August 9, 2011
Friday, August 5, 2011
Oil shale could help Israel energy independence
Oil shale could help Israel energy independence
April 27, 2011
IEI says could produce 50,000 bpd at cost of $35-$40/bbl
* Rupert Murdoch, Jacob Rothschild are key investorsBy Ari Rabinovitch
JERUSALEM, April 27 (Reuters) - A subsidiary of U.S.-firm IDT Energy (IDT.N) is leading a push in Israel to tap into the country's vast deposits of oil shale.
The company, Israel Energy Initiatives (IEI), has already invested "tens of millions of dollars" in preparing a pilot project it hopes to launch by the end of 2011, CEO Relik Shafir told Reuters.
"If successful, in a few years IEI could start producing 50,000 barrels of oil a day, or 20 percent of Israel's consumption, for 30 years," Shafir said.
The division of IDT that owns IEI is called Genie Energy, and it has already brought investments from financier Jacob Rothschild and media mogul Rupert Murdoch. Together they own a 5.5 percent stake worth $11 million, according to a company statement from November.
Murdoch, upon joining Genie Energy's advisory board last year, said the group would "spur a global, geo-political paradigm shift by moving a major portion of new oil production to America, Israel and other Western-oriented democracies."
Rothschild made similar comments.
Israel's oil shale deposits have been known about for decades. A 2005 U.S. Geological Survey report listed Israel among 14 countries with serious oil shale potential but they only became commercially viable since the price of oil skyrocketed. U.S. crude CLc1 is currently above $110 a barrel.
Israel's Infrastructure Ministry says subsurface oil shale covers 15 percent of the country, and the amount in the area of IEI's licence alone is comparable to the oil in Saudi Arabia.
Relik said his company could produce high-quality oil on a large scale at a cost of $35-$40 a barrel.
There is strong government support to pursue oil shale, which together with newly discovered off-shore natural gas fields, would move Israel closer to energy independence. But there are also some major obstacles.
IEI's exploration licence covers an area near the biblical Ellah valley just outside Jerusalem where it is believed David fought Goliath. Residents and powerful environmental groups oppose even the small pilot project.
Further complicating the progress, a small oil shale mine in the southern Negev desert run by Israel Chemicals (ICL.TA) caught fire earlier this year. It took weeks to extinguish the blaze, causing environmental damage and fueling opposition. Since then, the company said it might close the mine.
IEI says it uses a much newer technology, similar to what oil giant Royal Dutch Shell (RDSa.L) uses in the western United States and is trying to introduce in neighbouring Jordan. In fact its chief scientist, Harold Vinegar, for years held the same position at Shell.
Most of the work will be done below the surface. In the pilot, IEI will drill 250-300 metres deep, inject heat, and come away with five barrels a day. It will simply be graded up for the commercial stage.
Israel's Infrastructure Ministry told Reuters it would consider granting further licences for oil shale exploration, though other foreign firms will likely wait to see IEI's fate.
Israeli Oil: Black Gold in the Holy Land
Israeli Oil: Black Gold in the Holy Land
China and the United States currently have the largest deposits of shale oil but, as the largest consumers of energy, these countries consume most of their deposits. Therefore, Israel could potentially become the world’s leading exporter of shale oil.Developments in extraction technology have significantly lowered the price per barrel of shale oil to $35 or $40. This poses a serious threat to Saudi Arabia, the world’s leading exporter of oil. The recent Wikileaks suggest that Saudi Arabia has been overstating its oil reserves by as much as 300 billion and is estimated to actually have only 260 billion barrels of oil. With deposits rivaling those of Saudi Arabia, Israel may well join the ranks of the world’s top oil exporters.
Israeli energy initiatives have already attracted international attention and celebrity investors including Dick Cheney, Rupert Murdoch, Jacob Rothschild, and Harold Vinegar, the world’s leading shale oil extraction expert. According to Vinegar, “These Israeli deposits have been known about, but have never been listed before. It was previously assumed there was not the technology to deal with it.”
With newfound resources and new age technology come endless possibility. To many, this news is a blessing, for some a burden, and for still others a mixed bag. Here are a few examples of how the development of the region is being received:
For Israelis:
Currently, Israel must import all its oil and 70 percent of its gas. Given the recent suspension of natural gas from Egypt, the development of its oil reserves is a boon to Israeli energy security. Israel has pledged to move away from dirtier forms of energy and has worked to develop advances in shale oil extraction technology.
For religious Zionists:
Zion Oil & Gas Inc. was founded in 1983 by John Brown, a devout Christian, after reading in Deuteronomy 33:18-19 that Israel shall “suck the abundance of the seas and treasures hid in the sand.” Since the discovery, many Jews and Christians cited the book of Ezekiel as well, prophesizing a “spoil” to be found in Jerusalem.
For environmentalists:
International environmental lobbies in the past have criticized shale oil extraction as a water intensive and air polluting process. Yet Israel’s Energy Initiative refutes the claim that the process requires excess use of water and assures that a nearby aquifer will not be contaminated by the work. According to Lawrence Solomon, the executive director of the environmental research team, Energy Probe, Israeli oil has, “an exceedingly low environmental footprint.”
For academics:
Joining the ranks of countries like Switzerland and Singapore, Israel has had to develop its human capital in the absence of abundant natural resources. Some attribute Israel’s success to this counterintuitive finding and cite case studies of countries with great nonrenewable natural resources having a “resource curse,” a condition of dependence, volatility, and lopsided economic growth. Therefore, some have received Israel’s energy development with cautious indecision.
For Palestinians:
Palestinians have objected to Israel’s development as many believe Israel’s land is rightfully theirs. One Fatah member has already been quoted as calling it an “act of aggression.” However, in all likelihood, Palestinians will benefit from the trade and economic activity spurred by Israel’s newfound resource. As one study points out, “The magnitude of Israeli exports is directly and strongly linked to the level of Palestinian economic activity at large.”
For OPEC:
OPEC had long retained a monopoly on petroleum. After the attempted oil embargo in the 1970s, the power of the OPEC cartel has faded but its political influence endures by putting political contingencies on the transaction of oil. Israeli oil reserves may challenge the cartel and, by introducing more competition into the market, considerably reduce OPEC’s political clout.
For the United States:
The United States may enjoy a modest decrease in the price of oil but the geopolitical benefits far exceed the economic gains. For example, if freed from the diplomatic constraints of a dependency on Arab oil, American presidents may no longer have to kowtow to the King of Saudi Arabia, who denies women the right to vote and allows stoning as a punishment for adultery. Israeli oil could bring about a global shift in the petroleum paradigm.
Photo Credit: http://geology.com/usgs/oil-shale/images/israel-jordan-oil-shale-map.gif
A Closer Look at Israeli Oil Shale Technology
A Closer Look at Israeli Oil Shale Technology
As promised, here is a primer on the oil shale technology that might help Israel become energy independent.
The technology was invented by the serendipitously named Dr. Harold Vinegar during his 32-year tenure at Royal Dutch Shell. Shell is exploring the use of the technology in Jordan, where there are also major oil shale deposits, but opted against exploration in Israel. Vinegar retired from Shell as Chief Scientist and made aliyah to Israel, where he began teaching petroleum science at Ben Gurion University. He then joined Israel Energy Initiatives (IEI), where he is now Chief Scientist. (I am meeting Dr. Vinegar soon and will give you a more detailed and personal account of this history.)
Before we get to the technology, a quick word on oil shale.
There are two general categories of oil: conventional and unconventional. Conventional oil is called crude, the stream of free-flowing hydrocarbons that are drawn out of the ground by the nodding, mantis-like pumps with which you’re familiar. Unconventional oil is oil produced from less easily tapped sources and by methods other than by traditional wells.
One unconventional oil source is extra-heavy crude, which flows about as easily as cold blackstrap molasses and will sink if you pour some into a glass of water. Tar sands, or bituminous sands, contain a particularly viscous variety of heavy crude. Getting it out is labor-intensive, to say the least, and the proportion of usable fuel to be generated from a barrel of tar sands is relatively low. Still, as oil prices rise, tar sand oil production becomes more commercially viable.
Another unconventional source is oil shale, which does not, in fact, contain oil. Oil shale is sedimentary rock containing kerogen, which is premature oil. The rock is the product of organic debris that has been cooking below the surface of the earth for millions of years. When the kerogen in the rock is heated, its long chains of carbons begin to break into smaller and smaller pieces. Eventually, oil — among other products — is released.
The oil derived from the shale through IEI’s process is a light synthetic condensate that is easier to refine than conventional crude. The challenge is on the upstream end — getting it out of the rock.
Until very recently, there were two ways of doing this. One is to mine the rock, bring it to the surface, crush it, and heat it in a furnace called a retort. The other — still in the piloting stage of development — is to heat the rock while it is underground to expel the oil and gas from the kerogen, and then pump the products to the surface (in situ retorting). IEI’s method is a variant of the latter technique.
Surface retorting requires copious amounts of water to clean shale waste, cool the retorts, and refine the shale oil. In situ retorting does not require such large quantities of water because no shale waste is generated, no retorts need to be cooled, and the hydrogen needed to refine the oil is generated during the process itself. There is still a water cost, however, when subsurface waters are diverted from their normal flow. And both methods, up to this point, have been more expensive to implement than conventional drilling.
A particular challenge in the US — where 70% of the world’s oil shale deposits are located — is the proximity of the aquifers to the shale. During extraction, the waters are vulnerable to contamination by the hydrocarbons and must be protected. The only way to do so is to construct a freeze wall around the extraction area to prevent contact. And a freeze wall, in addition to adding to overall expense, raises the technology’s carbon footprint.
Israel is a different story. Here, where the shale deposits are uniform, thick and rich, the aquifer is well below the oil shale; they are separated from one another by about 200 meters of impermeable rock. There is therefore no need for a freeze wall. And Dr. Vinegar’s technology, rather than using water to function, actually generates water: the shale contains 20% water, which is produced during the extraction process. According to Dana Kadmiel, the IEI environmental engineer I spoke with, this water can be treated and subsequently used for agriculture.
The hydrogeological conditions here thus yield multiple advantages: lower water consumption, higher energy efficiencies, lower greenhouse gas emissions, and lower costs. Dana estimates that the resource will be extractable at a cost of about $40 a barrel.
IEI’s version of in situ retorting works like this:
Uniformly spaced horizontal heater wells, six inches in diameter, are drilled into the target oil shale. The wells are heated, either by electricity or by a circulating heat transfer fluid, probably molten salts (salts that can be melted at a low temperature and then brought to a very high temperature). The heater wells are maintained at high temperatures for several years, cooking the shale to about 300 degrees Celsius.
Eventually, the heat causes the kerogen to expel several high-value products: oil, water, natural gas (methane and ethane), LPG, and hydrogen. Hydrogen sulfide, a toxic gas, is also produced. It will be immediately isolated and treated to make elemental sulfur for use in fertilizer.
Above ground, the gases will be separated from the liquids and the water and oil separated from one another. The water will be sent for treatment and the oil to one of Israel’s two refineries for conversion into fuel.
IEI is currently in an appraisal phase and will shortly move into the pilot phase. If they are able to prove that the technology works, is economic, and is environmentally sustainable, they’ll move into the commercial phase. The appraisal phase involves drilling out samples of oil shale using what amounts to an extremely long apple corer and then testing it in the lab. During the pilot phase, they will drill vertically and use electricity to heat the shale. Once they get to the commercial phase, they will drill horizontally rather than vertically and move from electricity to molten salts, which are much more efficient and environmentally friendly. Natural gas will be used to heat the salts.
Down the road, they’re interested in using the sun to heat the salts, if a way can be found to make solar more efficient and economic. In the meantime, they’ll be able to use the natural gas generated by the process itself for heating purposes.
Oil shale reserves can turn Israel into major world producer Ian King From: The Times March 21, 2011 11:54AM Increase Text SizeDecrease Text SizePrintEmail Share
Oil shale reserves can turn Israel into major world producer
- From: The Times
- March 21, 2011
This Is What Israel's Energy-Independent Future Looks Like
This Is What Israel's Energy-Independent Future Looks Like
Judith Levy · Jul. 9 at 4:11am
If it's allowed to get that far. The resources are there, but so is a phalanx of home-grown opposition.
This is a photograph I took on Thursday of a chunk of oil shale that had been dug up moments before from 400 meters below ground (1,300 feet, or a bit deeper than the height of the Empire State Building) at a drilling site in the Shfela Basin, southwest of Jerusalem. The shale's surface is smooth and uniform, like a clay pot, and it has a uniquely earthy smell -- something roughly between mud after a downpour, a distant barnyard, and a glass of Campo Viejo Rioja.
Notice the fossils. In the little caravan next to the drilling site, I had a look through a microscope at plankton that had been brought to the surface during drilling.
This chunk of shale is about 70 million years old. It's part of a deposit with the potential to yield about 250 billion barrels, well beyond Israel's domestic needs and amply sufficient to transform Israel into an oil exporter. Not far from the patch of land from which it was extracted is the cave of Adullam, in which David hid when he was running from King Saul.
There is a great deal to say about these resources, and I plan to give it to you in installments. For the time being I'll call your attention to the resistance to the oil shale exploration, which falls roughly into two categories: anxious locals and angry environmentalists.
The locals are apprehensive -- understandably -- about the introduction of what they fear will be disruptive and destructive technology into a pristine, even idyllic landscape. The environmentalists object on principle to the extraction of fossil fuels, period, regardless of location, and regardless of the implications for Israel of energy independence -- Gaia trumps the state, in other words.
Woven into the objections of both constituencies are elements that will be difficult to combat via pilot projects and feasibility studies: reflexive mistrust of the word of any government agency or representative, a residual socialist repugnance against any industry with the potential to create great wealth for individuals, and a zero-sum assumption that any progress that's made on the oil front must, by definition, be at someone else's expense.
I hope to speak directly with people on the opposition as well as with key figures in the exploration, which is being run by a company called IEI (Israel Energy Initiatives). I spent all of Thursday deep in conversation with IEI environmental engineer Dana Kadmiel, who gave me exhaustive data on the company's technology. Stay tuned.
Notice the fossils. In the little caravan next to the drilling site, I had a look through a microscope at plankton that had been brought to the surface during drilling.
This chunk of shale is about 70 million years old. It's part of a deposit with the potential to yield about 250 billion barrels, well beyond Israel's domestic needs and amply sufficient to transform Israel into an oil exporter. Not far from the patch of land from which it was extracted is the cave of Adullam, in which David hid when he was running from King Saul.
There is a great deal to say about these resources, and I plan to give it to you in installments. For the time being I'll call your attention to the resistance to the oil shale exploration, which falls roughly into two categories: anxious locals and angry environmentalists.
The locals are apprehensive -- understandably -- about the introduction of what they fear will be disruptive and destructive technology into a pristine, even idyllic landscape. The environmentalists object on principle to the extraction of fossil fuels, period, regardless of location, and regardless of the implications for Israel of energy independence -- Gaia trumps the state, in other words.
Woven into the objections of both constituencies are elements that will be difficult to combat via pilot projects and feasibility studies: reflexive mistrust of the word of any government agency or representative, a residual socialist repugnance against any industry with the potential to create great wealth for individuals, and a zero-sum assumption that any progress that's made on the oil front must, by definition, be at someone else's expense.
I hope to speak directly with people on the opposition as well as with key figures in the exploration, which is being run by a company called IEI (Israel Energy Initiatives). I spent all of Thursday deep in conversation with IEI environmental engineer Dana Kadmiel, who gave me exhaustive data on the company's technology. Stay tuned.
Lawrence Solomon: Israeli oil could bust the OPEC cartel
Lawrence Solomon: Israeli oil could bust the OPEC cartel
(June 13, 2011) The old energy order in the Middle East is crumbling and a new energy order is emerging to give the West some spine. In this new order, Israel is a major player.
In the first 25 years after Israel’s founding in 1948, it was repeatedly attacked by the large armies of its Arab neighbours. Each time, Israel prevailed on the battlefield, only to have its victories rolled back by Western powers who feared losing access to Arab oilfields.
The fear was and is legitimate – Arab nations have often threatened to use their “oil weapon” against countries that support Israel and twice made good their threat through crippling OPEC oil embargoes.
But that fear, which shackles Israel to this day, may soon end. The old energy order in the Middle East is crumbling with Iran and Syria having left the Western fold and others, including Saudi Arabia, the largest of them all, in danger of doing so. Simultaneously, a new energy order is emerging to give the West some spine. In this new order, Israel is a major player.
The new energy order is founded on rock – the shale that traps vast stores of energy in deposits around the world. One of the largest deposits – 250 billion barrels of oil in Israel’s Shfela basin, comparable to Saudi Arabia’s entire reserves of 260 billion barrels of oil – has until now been unexploited, partly because the technology required has been expensive, mostly because the multinational oil companies that have the technology fear offending Muslims. “None of the major oil companies are willing to do business in Israel because they don’t want to be cut off from the Mideast supply of oil,” explains Howard Jonas, CEO of IDT, the U.S. company that owns the Shfela concession through its subsidiary, Israel Energy Initiatives. Jonas, an ardent Zionist, considers the Shfela deposit merely a beginning: “We believe that under Israel is more oil than under Saudi Arabia. There may be as much as half a trillion barrels.”
Because the oil multinationals have feared to develop Shfela, one of the world’s largest oil developments is being undertaken by an unlikely troop. Jonas’s IDT is a consumer-oriented telecom and media company that is a relative newcomer to the heavy industry world of energy development. Joining IDT in this latter-day Zionist Project is Lord Jacob Rothschild, a septuagenarian banker and philanthropist whose forefathers helped finance Zionist settlements in Palestine from the mid-1800s; Michael Steinhardt, a septuagenarian hedge fund investor and Zionist philanthropist; and Rupert Murdoch, the octogenarian chairman of News Corporation who uncompromisingly opposes, in his words, the “ongoing war against the Jews” by Muslim terrorists, by the Western left in general, and by Europe’s “most elite politicians” in particular.
Where others would have long ago retired, these businessmen-philanthropists have joined the battle on Israel’s side. While they’re in it for the money, they are also determined to free the world of Arab oil dependence by providing Israel with an oil weapon of its own. The company’s oil shale technology “could transform the future prospects of Israel, the Middle East and our allies around the world,” states Lord Rothschild.
To win this war, Israel Energy Initiatives has enlisted some of the energy industry’s savviest old soldiers – here a former president of Mobil Oil (Eugene Renna), there a former president of Occidental Oil Shale (Allan Sass), over there a former president of Halliburton (Dick Cheney). But the Field Commander for the operation, and the person who in their mind will lead them to ultimate victory, is Harold Vinegar, a veteran pulled out of retirement and sent into the fray. Vinegar, a legend in the field, had been Shell Oil’s chief scientist and, with some 240 patents to his name over his 32 years at Shell, revolutionized the shale oil industry.
Before oil met Vinegar, this was dirty business, a sprawling open mine operation that crushed and heated rock to yield a heavy tar amid mountains of spent shale. The low-value tar then needed to be processed and refined. The bottom line: low economic return, high environmental cost.
Vinegar boosted the bottom line by dropping the environmental damage. No open pit mining, no spent shale, no heavy tar to manage. In his pioneering approach, heated rods are inserted underground into the shale, releasing from it natural gas and light liquids. The natural gas provides the project’s need for heat; the light liquids are easily refined into high-value jet fuel, diesel and naphtha. The new bottom line: oil at a highly profitable cost of about $35-$40 a barrel and an exceedingly low environmental footprint. Vinegar’s process produces greenhouse gas emissions less than half that from conventional oil wells and, unlike open pit mining, does not consume water. The land area from which he will extract a volume of oil equivalent to that in Saudi Arabia? Approximately 25 square kilometers.
Although the Israeli shale project is still at an early stage, its massive potential and Vinegar’s reputation have already begun to change attitudes toward Israel. “We have been approached by all the majors,” Vinegar recently told the press, and for good reason. “Israel is very well positioned for oil exporting” to both European and Asian markets. The majors have other reasons, too, for casting their eyes afresh at Israel. Through its natural gas finds in the Mediterranean’s Levant Basin, and with no help from the oil majors, Israel is becoming a major natural gas exporter to Europe. According to the U.S. Geological Survey, the Levant Basin has vast natural gas supplies, most of it within Israel’s jurisdiction.
Attitudes to Israel in some European capitals – those in line to receive Israeli gas — have already warmed and the shift to Israel may in time become tectonic, in Europe and elsewhere, when oil is at stake – 38 countries have an estimated 4.8-trillion barrels of shale oil, many of which would benefit from the shale oil technology now being pioneered in Israel. Speeding that shift could be the Arab Spring, which many fear will flip pro-Western Arab states into hostile camps. Long time U.S. ally Saudi Arabia is reportedly so distrustful of the U.S. following its abandonment of long-time Egyptian ally, President Hosni Mubarak, that it has pulled back its relationship with the West in favour of China.
Before 1973, when the Arab world first punished the West for its relationship with Israel, Israel was a favourite of the left and of most of the free world. Under Arab punishment, much of the world started seeing the world through Arab eyes and turned on Israel.
But freed of the threat of Arab punishment, and in a new world energy order, Western countries may turn again, back to Israel and to their benefit. Rupert Murdoch well expresses the highest hopes of his partners: “If [our] effort to develop shale oil is successful, as I believe it will be, then the news we’ll report in the coming decades will reflect a more prosperous, more democratic and more secure world.”
Lawrence Solomon, Financial Post, June 13, 2011
Lawrence Solomon is executive director of Energy Probe. This is the third column in an ongoing series. (For the first in the series, click here.)
For Rupert Murdoch’s insightful “The ‘Soft War’ Against Israel” speech, click here.
For a detailed description of the Shfela Oil Shale Pilot Project, click here.
In the first 25 years after Israel’s founding in 1948, it was repeatedly attacked by the large armies of its Arab neighbours. Each time, Israel prevailed on the battlefield, only to have its victories rolled back by Western powers who feared losing access to Arab oilfields.
The fear was and is legitimate – Arab nations have often threatened to use their “oil weapon” against countries that support Israel and twice made good their threat through crippling OPEC oil embargoes.
But that fear, which shackles Israel to this day, may soon end. The old energy order in the Middle East is crumbling with Iran and Syria having left the Western fold and others, including Saudi Arabia, the largest of them all, in danger of doing so. Simultaneously, a new energy order is emerging to give the West some spine. In this new order, Israel is a major player.
The new energy order is founded on rock – the shale that traps vast stores of energy in deposits around the world. One of the largest deposits – 250 billion barrels of oil in Israel’s Shfela basin, comparable to Saudi Arabia’s entire reserves of 260 billion barrels of oil – has until now been unexploited, partly because the technology required has been expensive, mostly because the multinational oil companies that have the technology fear offending Muslims. “None of the major oil companies are willing to do business in Israel because they don’t want to be cut off from the Mideast supply of oil,” explains Howard Jonas, CEO of IDT, the U.S. company that owns the Shfela concession through its subsidiary, Israel Energy Initiatives. Jonas, an ardent Zionist, considers the Shfela deposit merely a beginning: “We believe that under Israel is more oil than under Saudi Arabia. There may be as much as half a trillion barrels.”
Because the oil multinationals have feared to develop Shfela, one of the world’s largest oil developments is being undertaken by an unlikely troop. Jonas’s IDT is a consumer-oriented telecom and media company that is a relative newcomer to the heavy industry world of energy development. Joining IDT in this latter-day Zionist Project is Lord Jacob Rothschild, a septuagenarian banker and philanthropist whose forefathers helped finance Zionist settlements in Palestine from the mid-1800s; Michael Steinhardt, a septuagenarian hedge fund investor and Zionist philanthropist; and Rupert Murdoch, the octogenarian chairman of News Corporation who uncompromisingly opposes, in his words, the “ongoing war against the Jews” by Muslim terrorists, by the Western left in general, and by Europe’s “most elite politicians” in particular.
Where others would have long ago retired, these businessmen-philanthropists have joined the battle on Israel’s side. While they’re in it for the money, they are also determined to free the world of Arab oil dependence by providing Israel with an oil weapon of its own. The company’s oil shale technology “could transform the future prospects of Israel, the Middle East and our allies around the world,” states Lord Rothschild.
To win this war, Israel Energy Initiatives has enlisted some of the energy industry’s savviest old soldiers – here a former president of Mobil Oil (Eugene Renna), there a former president of Occidental Oil Shale (Allan Sass), over there a former president of Halliburton (Dick Cheney). But the Field Commander for the operation, and the person who in their mind will lead them to ultimate victory, is Harold Vinegar, a veteran pulled out of retirement and sent into the fray. Vinegar, a legend in the field, had been Shell Oil’s chief scientist and, with some 240 patents to his name over his 32 years at Shell, revolutionized the shale oil industry.
Before oil met Vinegar, this was dirty business, a sprawling open mine operation that crushed and heated rock to yield a heavy tar amid mountains of spent shale. The low-value tar then needed to be processed and refined. The bottom line: low economic return, high environmental cost.
Vinegar boosted the bottom line by dropping the environmental damage. No open pit mining, no spent shale, no heavy tar to manage. In his pioneering approach, heated rods are inserted underground into the shale, releasing from it natural gas and light liquids. The natural gas provides the project’s need for heat; the light liquids are easily refined into high-value jet fuel, diesel and naphtha. The new bottom line: oil at a highly profitable cost of about $35-$40 a barrel and an exceedingly low environmental footprint. Vinegar’s process produces greenhouse gas emissions less than half that from conventional oil wells and, unlike open pit mining, does not consume water. The land area from which he will extract a volume of oil equivalent to that in Saudi Arabia? Approximately 25 square kilometers.
Although the Israeli shale project is still at an early stage, its massive potential and Vinegar’s reputation have already begun to change attitudes toward Israel. “We have been approached by all the majors,” Vinegar recently told the press, and for good reason. “Israel is very well positioned for oil exporting” to both European and Asian markets. The majors have other reasons, too, for casting their eyes afresh at Israel. Through its natural gas finds in the Mediterranean’s Levant Basin, and with no help from the oil majors, Israel is becoming a major natural gas exporter to Europe. According to the U.S. Geological Survey, the Levant Basin has vast natural gas supplies, most of it within Israel’s jurisdiction.
Attitudes to Israel in some European capitals – those in line to receive Israeli gas — have already warmed and the shift to Israel may in time become tectonic, in Europe and elsewhere, when oil is at stake – 38 countries have an estimated 4.8-trillion barrels of shale oil, many of which would benefit from the shale oil technology now being pioneered in Israel. Speeding that shift could be the Arab Spring, which many fear will flip pro-Western Arab states into hostile camps. Long time U.S. ally Saudi Arabia is reportedly so distrustful of the U.S. following its abandonment of long-time Egyptian ally, President Hosni Mubarak, that it has pulled back its relationship with the West in favour of China.
Before 1973, when the Arab world first punished the West for its relationship with Israel, Israel was a favourite of the left and of most of the free world. Under Arab punishment, much of the world started seeing the world through Arab eyes and turned on Israel.
But freed of the threat of Arab punishment, and in a new world energy order, Western countries may turn again, back to Israel and to their benefit. Rupert Murdoch well expresses the highest hopes of his partners: “If [our] effort to develop shale oil is successful, as I believe it will be, then the news we’ll report in the coming decades will reflect a more prosperous, more democratic and more secure world.”
Lawrence Solomon, Financial Post, June 13, 2011
Lawrence Solomon is executive director of Energy Probe. This is the third column in an ongoing series. (For the first in the series, click here.)
For Rupert Murdoch’s insightful “The ‘Soft War’ Against Israel” speech, click here.
For a detailed description of the Shfela Oil Shale Pilot Project, click here.
'Oil shale can bring energy security and independence'
Shooting out of a pipe at the Zoharim oil shale drilling site southwest of Beit Shemesh on Wednesday morning was the first shale sample from the location – an 80-centimeter-long, 15-centimeter-diameter, grayish cylinder of sediment – that had just been shuttled 331 meters upward by a sweating, hard-hat-outfitted crew.
“It’s like a birth,” Dana Kadmiel, environmental engineer for Israel Energy Initiatives, told The Jerusalem Post from the sidelines.
RELATED:Two oil spills strike Eilat Bay over weekend
Did Moses miss the good stuff?
Though not even yet in its official pilot phase, IEI’s shale extraction process aims to produce 40 billion barrels of oil in its currently licensed jurisdiction, which covers 16 percent of Israel’s oil shale stores, according to Kadmiel.
To create oil from shale – which is dark sedimentary rock containing hydrocarbons – workers must drill as far as 400 meters down through an impermeable layer to reach the shale, Kadmiel explained.
Surrounding the production pipeline, the company must also drill a ring of heating wells, which gradually heat the rock to 300º C and thereby transform it into lightweight oil in situ.
In this pre-pilot phase, rather than using heaters, the company is removing pieces of shale for analysis in Ben- Gurion University laboratories.
“It’s a little bit lean, but the lower section is good,” Yoav Dror, a geologist for IEI, which in based in the capital, told the Post, as he wrapped up the sample.
“I’m pleased that something came out, but most of the time they recover 100% of the material,” he said, noting that 80 centimeters was only 50% of their aim.
The technology for drilling into Israel’s apparently ample shale stock only arrived here recently, through the expertise of Brooklynite Dr. Harold Vinegar and his experience gained working for 32 years at Shell Oil, where he eventually became chief scientist.
“In 1980, I became involved in unconventional oil shale development in Colorado, and we did our first pilot – the Red Pinnacle pilot – in 1981, in a small place in the Piceance Basin, where the oil shale is very close to the surface,” he told the Post during an interview last week ahead of the Israeli Presidential Conference. “We did this mostly out of the back of a pickup truck.”
After years of pioneering the industry and creating over 200 patents of his own, Vinegar left Shell in 2008 to come to Israel – which after the US, Canada, China and Jordan probably has the fifth-largest oil shale deposits in the world, according to experts.
“[Shell] doesn’t want to deal with Israel – they deal with OPEC – and for them an investment here would be small,” said Kadmiel, noting that Shell has, however, started to do extractions in Jordan.
Vinegar joined with Dr. Yuval Bartov to build IEI, which is today owned by International Discount Telecommunications and chaired by American philanthropist Michael Steinhardt.
Back at the President’s Conference interview, Vinegar produced a slab of oil shale rock and a vial of reddish liquid.
“It looks like something you might drink, a wine, a rosé, perhaps,” he said. “It’s hard to believe that from a rock like this you can make an oil of such high quality.”
For Vinegar, not only is shale oil a much cleaner alternative to crude, it’s also a matter of “energy security.”
Israel imports 270,000 barrels of petroleum per day of oil and needs 50,000 of that for routine military operations – exactly what IEI aims to produce – according to the scientists.
“This will be a source of thousands of skilled jobs and an enormous GDP growth for the country,” Vinegar said.
To make a profit, IEI needs to produce 50,000 barrels per day of oil, which costs $40 per barrel to produce, as long as oil prices remain above $80 per barrel, Kadmiel said.
“Oil shale is such a dense resource that of the 238 square kilometers on our license, we are going to use less than half of 1% in total,” Vinegar explained.
Kadmiel added, “It’s enough for us, for Israel to be independent.”
As soon as IEI receives approval from the local district committee and the Water Authority, the company will start its 2.5-year pilot project near the Ha’ela junction, which will include a production well and six or seven surrounding heating wells, according to Kadmiel.
A “demonstration phase” will follow the pilot, and then the commercial phase can take place. Optimally, the heating wells would run on natural gas, but the pilot will use electricity from the national grid and require about 75,000 kilowatts per day, she explained.
Even in the smoothest of scenarios, however, Vinegar said that no oil is likely to start flowing until 2018-2020. And IEI is facing a plethora of environmental objectors, who say that natural resources will be destroyed and that increased production of fossil fuels is unnecessary.
Both Vinegar and Kadmiel stressed that the company is striving to leave as small a surface footprint as possible, with most work occurring underground and no gas escaping to the air. The aquifer runs 200 meters below the shale, with an impermeable rock layer in between, according to Kadmiel.
“From the moment you enter the ground, it will take about five to seven years to restore [the land] to its original state,” she said. “The land we’re using will become a field again.”
But Kadmiel acknowledged that the company must make stronger efforts to engage with environmentalists and the local community and “prove” that its methods are environmentally sound. “It’s our responsibility,” she said.
“It’s like a birth,” Dana Kadmiel, environmental engineer for Israel Energy Initiatives, told The Jerusalem Post from the sidelines.
RELATED:Two oil spills strike Eilat Bay over weekend
Did Moses miss the good stuff?
Though not even yet in its official pilot phase, IEI’s shale extraction process aims to produce 40 billion barrels of oil in its currently licensed jurisdiction, which covers 16 percent of Israel’s oil shale stores, according to Kadmiel.
To create oil from shale – which is dark sedimentary rock containing hydrocarbons – workers must drill as far as 400 meters down through an impermeable layer to reach the shale, Kadmiel explained.
Surrounding the production pipeline, the company must also drill a ring of heating wells, which gradually heat the rock to 300º C and thereby transform it into lightweight oil in situ.
In this pre-pilot phase, rather than using heaters, the company is removing pieces of shale for analysis in Ben- Gurion University laboratories.
“It’s a little bit lean, but the lower section is good,” Yoav Dror, a geologist for IEI, which in based in the capital, told the Post, as he wrapped up the sample.
“I’m pleased that something came out, but most of the time they recover 100% of the material,” he said, noting that 80 centimeters was only 50% of their aim.
The technology for drilling into Israel’s apparently ample shale stock only arrived here recently, through the expertise of Brooklynite Dr. Harold Vinegar and his experience gained working for 32 years at Shell Oil, where he eventually became chief scientist.
“In 1980, I became involved in unconventional oil shale development in Colorado, and we did our first pilot – the Red Pinnacle pilot – in 1981, in a small place in the Piceance Basin, where the oil shale is very close to the surface,” he told the Post during an interview last week ahead of the Israeli Presidential Conference. “We did this mostly out of the back of a pickup truck.”
After years of pioneering the industry and creating over 200 patents of his own, Vinegar left Shell in 2008 to come to Israel – which after the US, Canada, China and Jordan probably has the fifth-largest oil shale deposits in the world, according to experts.
“[Shell] doesn’t want to deal with Israel – they deal with OPEC – and for them an investment here would be small,” said Kadmiel, noting that Shell has, however, started to do extractions in Jordan.
Vinegar joined with Dr. Yuval Bartov to build IEI, which is today owned by International Discount Telecommunications and chaired by American philanthropist Michael Steinhardt.
Back at the President’s Conference interview, Vinegar produced a slab of oil shale rock and a vial of reddish liquid.
“It looks like something you might drink, a wine, a rosé, perhaps,” he said. “It’s hard to believe that from a rock like this you can make an oil of such high quality.”
For Vinegar, not only is shale oil a much cleaner alternative to crude, it’s also a matter of “energy security.”
Israel imports 270,000 barrels of petroleum per day of oil and needs 50,000 of that for routine military operations – exactly what IEI aims to produce – according to the scientists.
“This will be a source of thousands of skilled jobs and an enormous GDP growth for the country,” Vinegar said.
To make a profit, IEI needs to produce 50,000 barrels per day of oil, which costs $40 per barrel to produce, as long as oil prices remain above $80 per barrel, Kadmiel said.
“Oil shale is such a dense resource that of the 238 square kilometers on our license, we are going to use less than half of 1% in total,” Vinegar explained.
Kadmiel added, “It’s enough for us, for Israel to be independent.”
As soon as IEI receives approval from the local district committee and the Water Authority, the company will start its 2.5-year pilot project near the Ha’ela junction, which will include a production well and six or seven surrounding heating wells, according to Kadmiel.
A “demonstration phase” will follow the pilot, and then the commercial phase can take place. Optimally, the heating wells would run on natural gas, but the pilot will use electricity from the national grid and require about 75,000 kilowatts per day, she explained.
Even in the smoothest of scenarios, however, Vinegar said that no oil is likely to start flowing until 2018-2020. And IEI is facing a plethora of environmental objectors, who say that natural resources will be destroyed and that increased production of fossil fuels is unnecessary.
Both Vinegar and Kadmiel stressed that the company is striving to leave as small a surface footprint as possible, with most work occurring underground and no gas escaping to the air. The aquifer runs 200 meters below the shale, with an impermeable rock layer in between, according to Kadmiel.
“From the moment you enter the ground, it will take about five to seven years to restore [the land] to its original state,” she said. “The land we’re using will become a field again.”
But Kadmiel acknowledged that the company must make stronger efforts to engage with environmentalists and the local community and “prove” that its methods are environmentally sound. “It’s our responsibility,” she said.
New data: Israel may have 3rd largest deposit of oil shale in the world
New data: Israel may have 3rd largest deposit of oil shale in the world
March 12, 2011
There’s an old joke that when Moses was leading the Israelites out of Egypt, he made a wrong turn and missed all the oil. Well, it turns out that neither Moses nor G-d, made a mistake. Israel is on its way to becoming a energy Goliath.Yes, good news is coming out of Israel. Imam Obama, you had better put away any sharp objects nearby before proceeding, because you are not going to like this.
According to one-time Israeli ambassador to the UN, Dore Gold, writing in the Jerusalem Post, a new assessment of Israel’s oil shale was released late last year by Dr. Yuval Bartov, chief geologist for Israel Energy Initiatives. Data indicates that Israeli oil shale reserves are much greater than originally estimated, and could be the equivalent of 250 billion barrels (that compares with 260 billion barrels in the proven reserves of Saudi Arabia). The assessment was presented at the yearly symposium of the prestigious Colorado School of Mines.
Independent oil industry analysts have examined the shale, and have not refuted these findings. As a consequence of these new estimates, the Post says, “Israel may emerge as the 3rd largest deposit of oil shale, after the US and China.”
Now, already the massive Leviathan and Tamar fields off the coast of Israel have been noted as among the world’s biggest recent gas finds, capable of meeting Israel’s energy needs for decades to come.
Gold adds that, “The Tamar field, which should begin production in 2013, is expected to supply all of Israel’s domestic requirements for at least 20 years. The Economist suggested in November 2010 that the recently discovered Leviathan field, which has twice the gas of Tamar, could be completely devoted to exports.
All the undersea gas fields together have about 25 trillion cubic feet of gas, but the potential for further discoveries is considerably greater, given that the US Geological Survey estimates that there are 122 trillion cubic feet of gas in the whole Levant Basin, most of which is within Israel’s jurisdiction. After the Leviathan discovery these numbers could go up further.
Sweet.
Additionally, as I posted here, a new study is currently underway near Israel’s Hula Valley that also has “significant” onshore shale-gas potential.
But it gets even better. When high quality shale meets with Jewish genius, the result can be utterly transformational. Dore Gold writes:
Shale deposits“OIL SHALE mining used to be a dirty business that used up tremendous amounts of water and energy. Yet new technologies, being developed for Israeli shale, seek to separate the oil from the shale rock 300 meters underground; these techniques actually produce water, rather than use it up.The technology will be tested in a pilot project followed by a demonstration stage. It will be critical to demonstrate that the underground separation of oil from shale is environmentally sound before going to full-scale production. The present goal is to produce commercial quantities of shale oil by the end of the decade.”
If Israel succeeds in developing a unique, environmentally safe method for separating oil from shale deep underground – and don’t worry, because Israel will succeed – the consequences of Her success will change the world’s energy map. Israel will share Her technology with America and Canada who possess immense shale reserves, and then the West can kiss the Arab energy hegemony good-bye.
(‘Course, that would only be the case if B. Hussein Obama and the Democrats are permanently thrown out of office, so we can’t get too excited. If energy continues to be left up to Liberals, America won’t have any.)
The JP article continues:
“The effect of the spread of this technology would be to shift the center of gravity of world oil away from Iran, Saudi Arabia and the Persian Gulf to more stable states that have no history of backing terrorism or radical Islamic causes. (In the Arab world, Jordan and Morocco have the most significant oil shale deposits.)”
12 Tribes of Israel
These new discoveries show that Moses knew exactly where he was going, and that G-d in His infinite wisdom was just waiting until His people returned to the Land that He promised them, and had developed the means to extract His gift.
~ The hidden oil was hinted at in the Torah ~
G-d says to Israel in Deuteronomy 32:13, that He would “…let them suck honey out of the crag, and oil out of the flinty rock.”
To the Tribes of Zebulun and Issachar G-d said that they “shall suck of the abundance of the seas, and of treasures hid in the sand.” (Deuteronomy 33:19)
And to the Tribe of Asher that he would “dip his foot in oil.” (Deuteronomy 33:24)
Jerusalem Post – [...] There are two new developments in our energy sector that could well offset these trends and eventually alter our standing in the world, especially with respect to Europe.First, the gas discoveries in the Eastern Mediterranean, which began to produce commercial quantities of natural gas in 2004, are generally well-known. The Tamar field, which should begin production in 2013, is expected to supply all of Israel’s domestic requirements for at least 20 years. The Economist suggested in November 2010 that the recently discovered Leviathan field, which has twice the gas of Tamar, could be completely devoted to exports.All the undersea gas fields together have about 25 trillion cubic feet of gas, but the potential for further discoveries is considerably greater, given that the US Geological Survey estimates that there are 122 trillion cubic feet of gas in the whole Levant Basin, most of which is within Israel’s jurisdiction.After the Leviathan discovery these numbers could go up further. Perhaps for that reason, Greece has been talking to Israel about creating a transportation hub for distributing gas throughout Europe from the Eastern Mediterranean that will come from undersea pipelines.What is less well-known, but even more dramatic, is the work being done on this country’s oil shale. The British-based World Energy Council reported in November 2010 that Israel had oil shale from which it is possible to extract the equivalent of 4 billion barrels of oil. Yet these numbers are currently undergoing a major revision internationally.
A new assessment was released late last year by Dr. Yuval Bartov, chief geologist for Israel Energy Initiatives, at the yearly symposium of the prestigious Colorado School of Mines. He presented data that our oil shale reserves are actually the equivalent of 250 billion barrels (that compares with 260 billion barrels in the proven reserves of Saudi Arabia).Independent oil industry analysts have been carefully looking at the shale, and have not refuted these findings. As a consequence of these new estimates, we may emerge as the third largest deposit of oil shale, after the US and China.OIL SHALE mining used to be a dirty business that used up tremendous amounts of water and energy.Yet new technologies, being developed for Israeli shale, seek to separate the oil from the shale rock 300 meters underground; these techniques actually produce water, rather than use it up.The technology will be tested in a pilot project followed by a demonstration stage. It will be critical to demonstrate that the underground separation of oil from shale is environmentally sound before going to full-scale production. The present goal is to produce commercial quantities of shale oil by the end of the decade.
How Israel could revolutionize the global energy sector
Libyan oil accounts for less than 2 percent of world oil production, yet the revolt against Muammar Gaddafi has managed to shoot up the price of oil to more than $100 per barrel in the last month.
No one knows how long the internal instability in the Middle East will last, but according to the US Department of Energy, its share of the world’s total oil supply is expected to actually increase in the years ahead.
Simply, the world is using up the reserves of non- Middle East oil more quickly. Moreover, of the trillion barrels of proven reserves still left, according to the CIA roughly 800 billion barrels are to be found in the Middle East and North Africa, especially in Saudi Arabia, Iran and Iraq.
The implications for Israel of the West’s growing dependence on Middle Eastern oil are troubling, for obvious reasons. Yet there are two new developments in our energy sector that could well offset these trends and eventually alter our standing in the world, especially with respect to Europe.
First, the gas discoveries in the Eastern Mediterranean, which began to produce commercial quantities of natural gas in 2004, are generally well-known. The Tamar field, which should begin production in 2013, is expected to supply all of Israel’s domestic requirements for at least 20 years. The Economist suggested in November 2010 that the recently discovered Leviathan field, which has twice the gas of Tamar, could be completely devoted to exports.
All the undersea gas fields together have about 25 trillion cubic feet of gas, but the potential for further discoveries is considerably greater, given that the US Geological Survey estimates that there are 122 trillion cubic feet of gas in the whole Levant Basin, most of which is within Israel’s jurisdiction.
After the Leviathan discovery these numbers could go up further. Perhaps for that reason, Greece has been talking to Israel about creating a transportation hub for distributing gas throughout Europe from the Eastern Mediterranean that will come from undersea pipelines.
What is less well-known, but even more dramatic, is the work being done on this country’s oil shale. The British-based World Energy Council reported in November 2010 that Israel had oil shale from which it is possible to extract the equivalent of 4 billion barrels of oil. Yet these numbers are currently undergoing a major revision internationally.
A new assessment was released late last year by Dr. Yuval Bartov, chief geologist for Israel Energy Initiatives, at the yearly symposium of the prestigious Colorado School of Mines. He presented data that our oil shale reserves are actually the equivalent of 250 billion barrels (that compares with 260 billion barrels in the proven reserves of Saudi Arabia).
Independent oil industry analysts have been carefully looking at the shale, and have not refuted these findings. As a consequence of these new estimates, we may emerge as the third largest deposit of oil shale, after the US and China.
OIL SHALE mining used to be a dirty business that used up tremendous amounts of water and energy.
Yet new technologies, being developed for Israeli shale, seek to separate the oil from the shale rock 300 meters underground; these techniques actually produce water, rather than use it up.
The technology will be tested in a pilot project followed by a demonstration stage. It will be critical to demonstrate that the underground separation of oil from shale is environmentally sound before going to full-scale production. The present goal is to produce commercial quantities of shale oil by the end of the decade.
This particular project has global significance.
For if Israel develops a unique method for separating oil from shale deep underground, that has none of the negative ecological side-effects of earlier oil shale efforts, that technology can be made available to the whole world, changing the entire global oil market. The effect of the spread of this technology would be to shift the center of gravity of world oil away from Iran, Saudi Arabia and the Persian Gulf to more stable states that have no history of backing terrorism or radical Islamic causes. (In the Arab world, Jordan and Morocco have the most significant oil shale deposits.) WHEN WILL the West begin to treat Israel as a powerful energy giant and not as a weak client state that must be pressured? In the case of the Saudis, when the US realized the true extent of their oil reserves, after America’s reserves in Texas and Oklahoma were depleted by World War II, it sought to upgrade its military and diplomatic ties with the Saudi kingdom even before its production capacity was fully exploited. The US-Saudi connection grew as massive infrastructure investments for moving Saudi oil to Western markets were made, like the Trans-Arabian Pipeline (TAPLINE).
More capital was needed for the Saudi oil project. US companies, like Standard Oil of New Jersey (today, Exxon) and Standard Oil of New York (Mobil), joined Texaco and Standard Oil of California, the original holder of the Saudi oil concession, and created the ARAMCO consortium in the late 1940s. ARAMCO executives came to be regular guests at the State Department, where they could present the Saudi perspective.
In time, Saudi Arabia’s status grew as its future position in world oil came to be appreciated.
In the case of Israel, updated international reports verifying the true dimensions of both its undersea gas and oil shale should be forthcoming in the next year.
Many more international companies are likely to take an interest in its energy sector at that time. Moreover, the full exploitation of these energy resources will require massive infrastructure investment for pipelines, liquified natural gas plants and new oil exporting outlets in the Mediterranean and Red Sea.
Israel is uniquely situated by its geographical position and is able to direct its energy exports to either Europe or China and India. It may not have the capital to build this export capacity, but the involvement of foreign investors in these projects will give European and American banks new interests in developments.
Western policies will not change overnight. Nonetheless, Israel needs to tell the full story of its newly emerging role in the world energy sector if it wants to begin to alter the way it has been handled internationally.
The writer is president of the Jerusalem Center for Public Affairs and served as ambassador to the UN.
No one knows how long the internal instability in the Middle East will last, but according to the US Department of Energy, its share of the world’s total oil supply is expected to actually increase in the years ahead.
Simply, the world is using up the reserves of non- Middle East oil more quickly. Moreover, of the trillion barrels of proven reserves still left, according to the CIA roughly 800 billion barrels are to be found in the Middle East and North Africa, especially in Saudi Arabia, Iran and Iraq.
The implications for Israel of the West’s growing dependence on Middle Eastern oil are troubling, for obvious reasons. Yet there are two new developments in our energy sector that could well offset these trends and eventually alter our standing in the world, especially with respect to Europe.
First, the gas discoveries in the Eastern Mediterranean, which began to produce commercial quantities of natural gas in 2004, are generally well-known. The Tamar field, which should begin production in 2013, is expected to supply all of Israel’s domestic requirements for at least 20 years. The Economist suggested in November 2010 that the recently discovered Leviathan field, which has twice the gas of Tamar, could be completely devoted to exports.
All the undersea gas fields together have about 25 trillion cubic feet of gas, but the potential for further discoveries is considerably greater, given that the US Geological Survey estimates that there are 122 trillion cubic feet of gas in the whole Levant Basin, most of which is within Israel’s jurisdiction.
After the Leviathan discovery these numbers could go up further. Perhaps for that reason, Greece has been talking to Israel about creating a transportation hub for distributing gas throughout Europe from the Eastern Mediterranean that will come from undersea pipelines.
What is less well-known, but even more dramatic, is the work being done on this country’s oil shale. The British-based World Energy Council reported in November 2010 that Israel had oil shale from which it is possible to extract the equivalent of 4 billion barrels of oil. Yet these numbers are currently undergoing a major revision internationally.
A new assessment was released late last year by Dr. Yuval Bartov, chief geologist for Israel Energy Initiatives, at the yearly symposium of the prestigious Colorado School of Mines. He presented data that our oil shale reserves are actually the equivalent of 250 billion barrels (that compares with 260 billion barrels in the proven reserves of Saudi Arabia).
Independent oil industry analysts have been carefully looking at the shale, and have not refuted these findings. As a consequence of these new estimates, we may emerge as the third largest deposit of oil shale, after the US and China.
OIL SHALE mining used to be a dirty business that used up tremendous amounts of water and energy.
Yet new technologies, being developed for Israeli shale, seek to separate the oil from the shale rock 300 meters underground; these techniques actually produce water, rather than use it up.
The technology will be tested in a pilot project followed by a demonstration stage. It will be critical to demonstrate that the underground separation of oil from shale is environmentally sound before going to full-scale production. The present goal is to produce commercial quantities of shale oil by the end of the decade.
This particular project has global significance.
For if Israel develops a unique method for separating oil from shale deep underground, that has none of the negative ecological side-effects of earlier oil shale efforts, that technology can be made available to the whole world, changing the entire global oil market. The effect of the spread of this technology would be to shift the center of gravity of world oil away from Iran, Saudi Arabia and the Persian Gulf to more stable states that have no history of backing terrorism or radical Islamic causes. (In the Arab world, Jordan and Morocco have the most significant oil shale deposits.) WHEN WILL the West begin to treat Israel as a powerful energy giant and not as a weak client state that must be pressured? In the case of the Saudis, when the US realized the true extent of their oil reserves, after America’s reserves in Texas and Oklahoma were depleted by World War II, it sought to upgrade its military and diplomatic ties with the Saudi kingdom even before its production capacity was fully exploited. The US-Saudi connection grew as massive infrastructure investments for moving Saudi oil to Western markets were made, like the Trans-Arabian Pipeline (TAPLINE).
More capital was needed for the Saudi oil project. US companies, like Standard Oil of New Jersey (today, Exxon) and Standard Oil of New York (Mobil), joined Texaco and Standard Oil of California, the original holder of the Saudi oil concession, and created the ARAMCO consortium in the late 1940s. ARAMCO executives came to be regular guests at the State Department, where they could present the Saudi perspective.
In time, Saudi Arabia’s status grew as its future position in world oil came to be appreciated.
In the case of Israel, updated international reports verifying the true dimensions of both its undersea gas and oil shale should be forthcoming in the next year.
Many more international companies are likely to take an interest in its energy sector at that time. Moreover, the full exploitation of these energy resources will require massive infrastructure investment for pipelines, liquified natural gas plants and new oil exporting outlets in the Mediterranean and Red Sea.
Israel is uniquely situated by its geographical position and is able to direct its energy exports to either Europe or China and India. It may not have the capital to build this export capacity, but the involvement of foreign investors in these projects will give European and American banks new interests in developments.
Western policies will not change overnight. Nonetheless, Israel needs to tell the full story of its newly emerging role in the world energy sector if it wants to begin to alter the way it has been handled internationally.
The writer is president of the Jerusalem Center for Public Affairs and served as ambassador to the UN.
R&D Corner: Israeli Oil Shale Technology
R&D Corner: Israeli Oil Shale Technology
Judith Levy · Jul. 13 at 11:13am
The technology was invented by the serendipitously named Dr. Harold Vinegar during his 32-year tenure at Royal Dutch Shell. Shell is exploring the use of the technology in Jordan, where there are also major oil shale deposits, but opted against exploration in Israel. Vinegar retired from Shell as Chief Scientist and made aliyah to Israel, where he began teaching petroleum science at Ben Gurion University. He then joined Israel Energy Initiatives (IEI), where he is now Chief Scientist. (I am meeting Dr. Vinegar soon and will give you a more detailed and personal account of this history.)
Before we get to the technology, a quick word on oil shale.
There are two general categories of oil: conventional and unconventional. Conventional oil is called crude, the stream of free-flowing hydrocarbons that are drawn out of the ground by the nodding, mantis-like pumps with which you're familiar. Unconventional oil is oil produced from less easily tapped sources and by methods other than by traditional wells.
One unconventional oil source is extra-heavy crude, which flows about as easily as cold blackstrap molasses and will sink if you pour some into a glass of water. Tar sands, or bituminous sands, contain a particularly viscous variety of heavy crude. Getting it out is labor-intensive, to say the least, and the proportion of usable fuel to be generated from a barrel of tar sands is relatively low. Still, as oil prices rise, tar sand oil production becomes more commercially viable.
Another unconventional source is oil shale, which does not, in fact, contain oil. Oil shale is sedimentary rock containing kerogen, which is premature oil. The rock is the product of organic debris that has been cooking below the surface of the earth for millions of years. When the kerogen in the rock is heated, its long chains of carbons begin to break into smaller and smaller pieces. Eventually, oil -- among other products -- is released.
The oil derived from the shale through IEI's process is a light synthetic condensate that is easier to refine than conventional crude. The challenge is on the upstream end -- getting it out of the rock.
Until very recently, there were two ways of doing this. One is to mine the rock, bring it to the surface, crush it, and heat it in a furnace called a retort. The other -- still in the piloting stage of development -- is to heat the rock while it is underground to expel the oil and gas from the kerogen, and then pump the products to the surface (in situ retorting). IEI's method is a variant of the latter technique.
Surface retorting requires copious amounts of water to clean shale waste, cool the retorts, and refine the shale oil. In situ retorting does not require such large quantities of water because no shale waste is generated, no retorts need to be cooled, and the hydrogen needed to refine the oil is generated during the process itself. There is still a water cost, however, when subsurface waters are diverted from their normal flow. And both methods, up to this point, have been more expensive to implement than conventional drilling.
A particular challenge in the US -- where 70% of the world's oil shale deposits are located -- is the proximity of the aquifers to the shale. During extraction, the waters are vulnerable to contamination by the hydrocarbons and must be protected. The only way to do so is to construct a freeze wall around the extraction area to prevent contact. And a freeze wall, in addition to adding to overall expense, raises the technology's carbon footprint.
Israel is a different story. Here, where the shale deposits are uniform, thick and rich, the aquifer is well below the oil shale; they are separated from one another by about 200 meters of impermeable rock. There is therefore no need for a freeze wall. And Dr. Vinegar's technology, rather than using water to function, actually generates water: the shale contains 20% water, which is produced during the extraction process. According to Dana Kadmiel, the IEI environmental engineer I spoke with, this water can be treated and subsequently used for agriculture.
The hydrogeological conditions here thus yield multiple advantages: lower water consumption, higher energy efficiencies, lower greenhouse gas emissions, and lower costs. Dana estimates that the resource will be extractable at a cost of about $40 a barrel.
IEI's version of in situ retorting works like this:
Uniformly spaced horizontal heater wells, six inches in diameter, are drilled into the target oil shale. The wells are heated, either by electricity or by a circulating heat transfer fluid, probably molten salts (salts that can be melted at a low temperature and then brought to a very high temperature). The heater wells are maintained at high temperatures for several years, cooking the shale to about 300 degrees Celsius.
Eventually, the heat causes the kerogen to expel several high-value products: oil, water, natural gas (methane and ethane), LPG, and hydrogen. Hydrogen sulfide, a toxic gas, is also produced. It will be immediately isolated and treated to make elemental sulfur for use in fertilizer.
Above ground, the gases will be separated from the liquids and the water and oil separated from one another. The water will be sent for treatment and the oil to one of Israel's two refineries for conversion into fuel.
IEI is currently in an appraisal phase and will shortly move into the pilot phase. If they are able to prove that the technology works, is economic, and is environmentally sustainable, they'll move into the commercial phase. The appraisal phase involves drilling out samples of oil shale using what amounts to an extremely long apple corer and then testing it in the lab. During the pilot phase, they will drill vertically and use electricity to heat the shale. Once they get to the commercial phase, they will drill horizontally rather than vertically and move from electricity to molten salts, which are much more efficient and environmentally friendly. Natural gas will be used to heat the salts.
Down the road, they're interested in using the sun to heat the salts, if a way can be found to make solar more efficient and economic. In the meantime, they'll be able to use the natural gas generated by the process itself for heating purposes.
British Parliament issues report on hydraulic fracturing
British Parliament issues report on hydraulic fracturing
The Energy and Climate Change Committee of the United Kingdom's House of Commons issued a report on hydraulic fracturing. The report provides an interesting, foreign perspective on an issues that have become the subject of heated debate here in the United States. The report includes a thorough discussion of several issues relating to hydraulic fracturing, as well as numerous specific recommendations and conclusions. One of the Committee's conclusions is that hydraulic fracturing should be allowed to proceed in Britain:
The report noted that hydraulic fracturing also has a potential environmental benefit because the process often is used to facilitate the production of natural gas, the cleanest burning of all fossil fuels ("shale gas" is simply a term for natural gas produced from shale). The Committee stated: "Shale gas could lead to a switch from coal to gas for electricity generation, thereby cutting carbon emissions, particularly projected emissions from developing countries."
The report acknowledged that a countervailing concern raised by some environmentalists is that there are fugitive emissions (small leaks) of gas during the production and transport of shale gas. Fugitive emissions are a concern because the main component of natural gas is methane, and methane (like carbon dioxide) is a greenhouse gas. The report concluded, however, that fugitive emissions can be minimized through proper regulations. The report also noted another concern -- that production of large quantities of shale gas might distract from efforts to develop renewable sources of energy.
But the main environmental concern that people express is a fear that hydraulic fracturing might harm the quality of underground sources of drinking water. On this issue, the UK report reached conclusions similar to those stated previously in this blog. The report noted that most shale formations are thousands of feet below drinking water aquifers, and that the fractures created by hydraulic fracturing are much shorter in length. That leaves two other potential mechanisms for contamination to occur. One would be for hydraulically-induced fractures to link with natural faults or fractures, leading to a pathway between the formation being fractured and a drinking water aquifer. But most analysts in the United States think this is very unlikely, and the Committee seemed to agree.
The general consensus is that, if contamination were to occur, it likely would be as a result of the other potential mechanism for contamination -- a well construction failure. Most oil and gas wells, including both those that are hydraulically fractured and those that are not, are drilled to formations that are located deeper beneath the surface than drinking water aquifers are. Oil or gas wells pass through the drinking water aquifer, and casing and cementing of the well are used to seal the drinking water aquifer from deeper formations. Such casing and cementing has been done on millions of wells. The UK report stated:
Another issue of occasional concern in the United States is water supply. Typically, a few million gallons of water are used in fracturing an oil or gas well drilled into a shale formation. That amount is fairly modest compared to some other industrial and agricultural uses. Nevertheless, this amount of water use can put a strain on supplies in areas that already are facing water shortages. The UK report stated that water supply generally should not be a problem if fracturing is performed in Britain, but that fracturing "could challenge resources in regions already experiencing water stress."
The report also weighed-in on the issue of whether regulations should require that the composition of fracturing water be disclosed. That has been a hot issue in the United States. The UK report endorsed some reporting, but it is not clear whether the report meant to support the disclosure of the specific chemical compounds used. The report said that well operators should report the volume of fracturing water used, as well as the "type" of chemicals used, and the concentrations. In the debate within the United States about disclosure requirements, when people refer to the "type" of additive they often are referring to the functional category of an additive -- that is, whether the additive is a biocide, corrosion inhibitor, friction reducer, etc. -- rather than the identity of the specific chemical compound. It is not immediately clear whether this is what the report meant, or whether it was advocating that specific chemical compounds be identified.
In addition, the report discussed the possibility of spills of fracturing fluid, and such localized effects as noise and traffic that can result from increased drilling activity, and how those concerns can be addressed.
The report contains two volumes. The first contains the narrative report, plus a transcript of questions and answers from hearings. The second contains written materials presented by various individuals and organizations, including environmental groups, trade groups, and companies.
On balance, we feel that there should not be a moratorium on the use of hydraulic fracturing in the exploitation of the UK's hydrocarbon resources, including unconventional resources such as shale gas."The Committee analyzed both the benefits of hydraulic fracturing and the environmental concerns that have been raised. The Committtee's report identified economic gains and decreased dependence on foreign sources of energy as being two of the benefits. The Committee concluded that UK shale gas resources "could be considerable," though "it is unlikely that shale gas will be a 'game changer' in the UK to the same extent it has been in the U.S." An interesting part of the report was a statement that Britain may have greater shale resources offshore than under land.
The report noted that hydraulic fracturing also has a potential environmental benefit because the process often is used to facilitate the production of natural gas, the cleanest burning of all fossil fuels ("shale gas" is simply a term for natural gas produced from shale). The Committee stated: "Shale gas could lead to a switch from coal to gas for electricity generation, thereby cutting carbon emissions, particularly projected emissions from developing countries."
The report acknowledged that a countervailing concern raised by some environmentalists is that there are fugitive emissions (small leaks) of gas during the production and transport of shale gas. Fugitive emissions are a concern because the main component of natural gas is methane, and methane (like carbon dioxide) is a greenhouse gas. The report concluded, however, that fugitive emissions can be minimized through proper regulations. The report also noted another concern -- that production of large quantities of shale gas might distract from efforts to develop renewable sources of energy.
But the main environmental concern that people express is a fear that hydraulic fracturing might harm the quality of underground sources of drinking water. On this issue, the UK report reached conclusions similar to those stated previously in this blog. The report noted that most shale formations are thousands of feet below drinking water aquifers, and that the fractures created by hydraulic fracturing are much shorter in length. That leaves two other potential mechanisms for contamination to occur. One would be for hydraulically-induced fractures to link with natural faults or fractures, leading to a pathway between the formation being fractured and a drinking water aquifer. But most analysts in the United States think this is very unlikely, and the Committee seemed to agree.
The general consensus is that, if contamination were to occur, it likely would be as a result of the other potential mechanism for contamination -- a well construction failure. Most oil and gas wells, including both those that are hydraulically fractured and those that are not, are drilled to formations that are located deeper beneath the surface than drinking water aquifers are. Oil or gas wells pass through the drinking water aquifer, and casing and cementing of the well are used to seal the drinking water aquifer from deeper formations. Such casing and cementing has been done on millions of wells. The UK report stated:
There is no evidence that the hydraulic fracturing process poses any risk to underground water aquifers provided that the well-casing is intact before the process commences. Rather the risks of water contamination are due to issues of well integrity, and are no different than concerns encountered during the extraction of oil or gas from conventional reservoirs."For that reason, the report concluded that care should be given to well construction standards and inspection. The report expressed a belief that Britain's existing regulations for well construction are adequate.
Another issue of occasional concern in the United States is water supply. Typically, a few million gallons of water are used in fracturing an oil or gas well drilled into a shale formation. That amount is fairly modest compared to some other industrial and agricultural uses. Nevertheless, this amount of water use can put a strain on supplies in areas that already are facing water shortages. The UK report stated that water supply generally should not be a problem if fracturing is performed in Britain, but that fracturing "could challenge resources in regions already experiencing water stress."
The report also weighed-in on the issue of whether regulations should require that the composition of fracturing water be disclosed. That has been a hot issue in the United States. The UK report endorsed some reporting, but it is not clear whether the report meant to support the disclosure of the specific chemical compounds used. The report said that well operators should report the volume of fracturing water used, as well as the "type" of chemicals used, and the concentrations. In the debate within the United States about disclosure requirements, when people refer to the "type" of additive they often are referring to the functional category of an additive -- that is, whether the additive is a biocide, corrosion inhibitor, friction reducer, etc. -- rather than the identity of the specific chemical compound. It is not immediately clear whether this is what the report meant, or whether it was advocating that specific chemical compounds be identified.
In addition, the report discussed the possibility of spills of fracturing fluid, and such localized effects as noise and traffic that can result from increased drilling activity, and how those concerns can be addressed.
The report contains two volumes. The first contains the narrative report, plus a transcript of questions and answers from hearings. The second contains written materials presented by various individuals and organizations, including environmental groups, trade groups, and companies.
Hydraulic Fracturing Q & A's
Hydraulic Fracturing Q & A's
What is hydraulic fracturing?
Hydraulic fracturing is a proven technology that has been used since the 1940s in more than 1 million wells in the United States to help produce oil and natural gas. The technology involves pumping a water-sand mixture into underground rock layers where the oil or gas is trapped. The pressure of the water creates tiny fissures in the rock. The sand holds open the fissures, allowing the oil or gas to escape and flow up the well.
Is hydraulic fracturing widely used?
Yes, and its use is likely to increase. A government-industry study found that up to 80 percent of natural gas wells drilled in the next decade will require hydraulic fracturing. Hydraulic fracturing allows access to formations, like shale oil and shale gas, that had not been assessable before without the technology. It also allows more oil and natural gas to be brought to the surface from wells that had been produced without this technology.
Why is hydraulic fracturing important?
It enables production of more oil and natural gas, reducing dependence on foreign sources of energy and creating more jobs for Americans. It’s an indispensable technology for producing much of our clean-burning natural gas, which heats more than 56 million American homes, generates one-fifth of our nation’s electricity, powers buses and fleet vehicles and creates the basic materials for such things as fertilizers and plastics of every variety. When burned for energy, natural gas emits fewer greenhouse gases than other fossil fuels.
Doesn’t hydraulic fracturing present a serious threat to the environment?
No. The environmental track record is good, and the technology is used under close regulatory supervision by state, local and federal regulators. Hydraulic fracturing has been used in nearly one million wells in the United States and studies by the U.S. EPA and the Ground Water Protection Council have confirmed no direct link between hydraulic fracturing operations and groundwater impacts.
How are the fluids kept away from aquifers and drinking water wells?
Wells are drilled away from drinking water wells. Also, fracturing usually occurs at depths well below where usable groundwater is likely to be found. Finally, when a well is drilled, steel casing and surrounding layers of concrete are installed to provide a safe barrier to protect usable water.
Who regulates hydraulic fracturing?
There are multiple federal, state and local government rules addressing environmental protection during oil and gas operations, including the protection of water resources. These rules cover well permitting, well materials and construction, safe disposition of used hydraulic fracturing fluids, water testing, and chemical recordkeeping and reporting. In addition, API has created a guidance document on proper well construction and plans to release guidance documents outlining best-available practices for water use and management and protecting the environment during hydraulic fracturing operations.
Isn’t there a risk that hydraulic fracturing will use up an area’s water supplies?
No. Local authorities control water use and can restrict it if necessary. In many areas, water is recycled and reused; in some cases companies pay for the water they use, which comes from a variety of sources. Water requirements for hydraulic fracturing are less than many other commercial and recreational uses. In Pennsylvania, for example, all the hydraulic fracturing activity taking place in 2009 used only 5 percent of the amount of water used for recreational purposes, like golf courses and ski slopes. State agencies manage water in a way that safeguards the water needs by nearby communities and protects the environment. Companies recycle and reuse much of the water.
Why should communities allow hydraulic fracturing?
Besides the energy produced with little impact on the environment, communities benefit economically. Energy development creates jobs and generates millions of dollars in royalties, taxes and other revenues to federal, state, and local governments. It provides energy for U.S. industry, helps strengthen our economy locally and nationally, and helps contribute to higher disposable incomes.
Newsroom
In the Classroom
About API
Print this page
API: Permit process in Alaska’s Beaufort Sea shows need for greater efficiency
More
API commends budget negotiators for not raising taxes in fragile economic recovery
More
--------------------------------------------------------------------------------
API Workshop on Commitment to Excellence in Hydraulic Fracturing - Oct. 4-5, 2011 - Pittsburgh, PA
API Storage Tank Conference & Expo - Oct. 17-20, 2011 - Las Vegas, Nevada
--------------------------------------------------------------------------------
Updated:December 9, 2009
What is hydraulic fracturing?
Hydraulic fracturing is a proven technology that has been used since the 1940s in more than 1 million wells in the United States to help produce oil and natural gas. The technology involves pumping a water-sand mixture into underground rock layers where the oil or gas is trapped. The pressure of the water creates tiny fissures in the rock. The sand holds open the fissures, allowing the oil or gas to escape and flow up the well.
Is hydraulic fracturing widely used?
Yes, and its use is likely to increase. A government-industry study found that up to 80 percent of natural gas wells drilled in the next decade will require hydraulic fracturing. Hydraulic fracturing allows access to formations, like shale oil and shale gas, that had not been assessable before without the technology. It also allows more oil and natural gas to be brought to the surface from wells that had been produced without this technology.
Why is hydraulic fracturing important?
It enables production of more oil and natural gas, reducing dependence on foreign sources of energy and creating more jobs for Americans. It’s an indispensable technology for producing much of our clean-burning natural gas, which heats more than 56 million American homes, generates one-fifth of our nation’s electricity, powers buses and fleet vehicles and creates the basic materials for such things as fertilizers and plastics of every variety. When burned for energy, natural gas emits fewer greenhouse gases than other fossil fuels.
Doesn’t hydraulic fracturing present a serious threat to the environment?
No. The environmental track record is good, and the technology is used under close regulatory supervision by state, local and federal regulators. Hydraulic fracturing has been used in nearly one million wells in the United States and studies by the U.S. EPA and the Ground Water Protection Council have confirmed no direct link between hydraulic fracturing operations and groundwater impacts.
How are the fluids kept away from aquifers and drinking water wells?
Wells are drilled away from drinking water wells. Also, fracturing usually occurs at depths well below where usable groundwater is likely to be found. Finally, when a well is drilled, steel casing and surrounding layers of concrete are installed to provide a safe barrier to protect usable water.
Who regulates hydraulic fracturing?
There are multiple federal, state and local government rules addressing environmental protection during oil and gas operations, including the protection of water resources. These rules cover well permitting, well materials and construction, safe disposition of used hydraulic fracturing fluids, water testing, and chemical recordkeeping and reporting. In addition, API has created a guidance document on proper well construction and plans to release guidance documents outlining best-available practices for water use and management and protecting the environment during hydraulic fracturing operations.
Isn’t there a risk that hydraulic fracturing will use up an area’s water supplies?
No. Local authorities control water use and can restrict it if necessary. In many areas, water is recycled and reused; in some cases companies pay for the water they use, which comes from a variety of sources. Water requirements for hydraulic fracturing are less than many other commercial and recreational uses. In Pennsylvania, for example, all the hydraulic fracturing activity taking place in 2009 used only 5 percent of the amount of water used for recreational purposes, like golf courses and ski slopes. State agencies manage water in a way that safeguards the water needs by nearby communities and protects the environment. Companies recycle and reuse much of the water.
Why should communities allow hydraulic fracturing?
Besides the energy produced with little impact on the environment, communities benefit economically. Energy development creates jobs and generates millions of dollars in royalties, taxes and other revenues to federal, state, and local governments. It provides energy for U.S. industry, helps strengthen our economy locally and nationally, and helps contribute to higher disposable incomes.
Newsroom
In the Classroom
About API
Print this page
API: Permit process in Alaska’s Beaufort Sea shows need for greater efficiency
More
API commends budget negotiators for not raising taxes in fragile economic recovery
More
--------------------------------------------------------------------------------
API Workshop on Commitment to Excellence in Hydraulic Fracturing - Oct. 4-5, 2011 - Pittsburgh, PA
API Storage Tank Conference & Expo - Oct. 17-20, 2011 - Las Vegas, Nevada
--------------------------------------------------------------------------------
Updated:December 9, 2009
Facts About Shale Gas
Facts About Shale Gas
•Unconventional natural gas deposits are difficult to characterize overall, but in general are often lower in resource concentration, more dispersed over large areas, and require well stimulation or some other extraction or conversion technology. Extremely large natural gas in-place volumes are represented by these resources, and the US has produced only a fraction of their ultimate potential.
•Shale gas is defined as natural gas from shale formations. The shale acts as both the source and the reservoir for the natural gas. Older shale gas wells were vertical while more recent wells are primarily horizontal and need artificial stimulation, like hydraulic fracturing, to produce. Only shale formations with certain characteristics will produce gas. The most significant trend in US natural gas production is the rapid rise in production from shale formations. In large measure this is attributable to significant advances in the use of horizontal drilling and well stimulation technologies and refinement in the cost-effectiveness of these technologies. Hydraulic fracturing is the most significant of these.
•The consulting firm ICF forecasts that tight gas, coalbed methane, and shale gas will make a major contribution to future North American gas production. Unconventional gas production is forecast to increase from 42 percent of total US gas production in 2007 to 64 percent in 2020. Despite the current economic conditions, the long-term need for US natural gas should be strong enough to support these anticipated future production levels.
•With the tremendous success of the Barnett, Fayetteville and Woodford shales in the United States, the gas shale resource base will play a major role in the future natural gas production on which the nation will depend. Already the Barnett Shale gas play in Texas produces 6 percent of all natural gas produced in the Lower 48 states. Recent announcements of emerging plays in Appalachia, Northern Louisiana, British Columbia, and South Texas indicate the widespread potential of shale gas resources across North America. Each of these shale gas basins is different and each has a unique set of exploration criteria and operational challenges.
•The Potential Gas Committee, an incorporated, nonprofit organization that consists of knowledgeable and highly experienced volunteer members who work in the natural gas exploration, production and transportation industries issued its biennial assessment of the nation’s gas resources in June 2009. This study indicates that the United States possesses a resource base of 1,836 Tcf of natural gas. When combining these results with the Department of Energy’s latest determination of proved gas reserves, 238 Tcf as of year-end 2007, the United States has a future supply of natural gas of over 2,000 Tcf. At current consumption rates, this is enough natural gas to supply the nation for the next hundred years. This is an increase of more than 35% when compared to the Committee’s 2006 assessment. This increase is largely attributable to increased supplies from unconventional gas plays, specifically from shale gas development.
•In its April 2009 report, "Modern Shale Gas Development in the United States: A Primer," the US Department of Energy stated that at the US natural gas production rates for 2007 of about 19.3 Tcf, the current recoverable resource estimate provides enough natural gas to supply the US for the next 90 years. Separate estimates of the shale gas resource extend this supply to 116 years. Production of shale gas is expected to increase from a 2007 US total of 1.4 Tcf to 4.8 Tcf in 2020. The DOE report states that shale gas production potential of 3 to 4 Tcf per year may be sustainable for decades. The INGAA report stated that to achieve the forecast results, industry must have land access for drilling, a reasonable permitting process and adequate prices and demand for natural gas.
•In November 2008, the Interstate Natural Gas Association of America (INGAA) published a report, "Availability, Economics and Production Potential of North American Unconventional Natural Gas Supplies," that included an updated resource base for natural gas in the United States and Canada. The INGAA study states that the assessment of shale gas potential in the United States and Canada is a work in progress and there is a long way to go to understand remaining potential and implications for future natural gas production. The advance of drilling and well completion technologies, including hydraulic fracturing, has opened up plays in a number of different basins that were not previously considered to have economic potential. The volumes calculated for gas-in-place are extremely large, and a small difference in the estimated percentage of gas-in-place that is recoverable has a huge impact on estimates of recoverable resources.
Newsroom
In the Classroom
About API
Print this page
API: Permit process in Alaska’s Beaufort Sea shows need for greater efficiency
More
API commends budget negotiators for not raising taxes in fragile economic recovery
More
--------------------------------------------------------------------------------
API Workshop on Commitment to Excellence in Hydraulic Fracturing - Oct. 4-5, 2011 - Pittsburgh, PA
API Storage Tank Conference & Expo - Oct. 17-20, 2011 - Las Vegas, Nevada
--------------------------------------------------------------------------------
IT Security
Partnerships in the Oil and Gas Industry
Energy Citizens
Oil Spill Prevention and Response
--------------------------------------------------------------------------------
Updated:February 1, 2010
•Unconventional natural gas deposits are difficult to characterize overall, but in general are often lower in resource concentration, more dispersed over large areas, and require well stimulation or some other extraction or conversion technology. Extremely large natural gas in-place volumes are represented by these resources, and the US has produced only a fraction of their ultimate potential.
•Shale gas is defined as natural gas from shale formations. The shale acts as both the source and the reservoir for the natural gas. Older shale gas wells were vertical while more recent wells are primarily horizontal and need artificial stimulation, like hydraulic fracturing, to produce. Only shale formations with certain characteristics will produce gas. The most significant trend in US natural gas production is the rapid rise in production from shale formations. In large measure this is attributable to significant advances in the use of horizontal drilling and well stimulation technologies and refinement in the cost-effectiveness of these technologies. Hydraulic fracturing is the most significant of these.
•The consulting firm ICF forecasts that tight gas, coalbed methane, and shale gas will make a major contribution to future North American gas production. Unconventional gas production is forecast to increase from 42 percent of total US gas production in 2007 to 64 percent in 2020. Despite the current economic conditions, the long-term need for US natural gas should be strong enough to support these anticipated future production levels.
•With the tremendous success of the Barnett, Fayetteville and Woodford shales in the United States, the gas shale resource base will play a major role in the future natural gas production on which the nation will depend. Already the Barnett Shale gas play in Texas produces 6 percent of all natural gas produced in the Lower 48 states. Recent announcements of emerging plays in Appalachia, Northern Louisiana, British Columbia, and South Texas indicate the widespread potential of shale gas resources across North America. Each of these shale gas basins is different and each has a unique set of exploration criteria and operational challenges.
•The Potential Gas Committee, an incorporated, nonprofit organization that consists of knowledgeable and highly experienced volunteer members who work in the natural gas exploration, production and transportation industries issued its biennial assessment of the nation’s gas resources in June 2009. This study indicates that the United States possesses a resource base of 1,836 Tcf of natural gas. When combining these results with the Department of Energy’s latest determination of proved gas reserves, 238 Tcf as of year-end 2007, the United States has a future supply of natural gas of over 2,000 Tcf. At current consumption rates, this is enough natural gas to supply the nation for the next hundred years. This is an increase of more than 35% when compared to the Committee’s 2006 assessment. This increase is largely attributable to increased supplies from unconventional gas plays, specifically from shale gas development.
•In its April 2009 report, "Modern Shale Gas Development in the United States: A Primer," the US Department of Energy stated that at the US natural gas production rates for 2007 of about 19.3 Tcf, the current recoverable resource estimate provides enough natural gas to supply the US for the next 90 years. Separate estimates of the shale gas resource extend this supply to 116 years. Production of shale gas is expected to increase from a 2007 US total of 1.4 Tcf to 4.8 Tcf in 2020. The DOE report states that shale gas production potential of 3 to 4 Tcf per year may be sustainable for decades. The INGAA report stated that to achieve the forecast results, industry must have land access for drilling, a reasonable permitting process and adequate prices and demand for natural gas.
•In November 2008, the Interstate Natural Gas Association of America (INGAA) published a report, "Availability, Economics and Production Potential of North American Unconventional Natural Gas Supplies," that included an updated resource base for natural gas in the United States and Canada. The INGAA study states that the assessment of shale gas potential in the United States and Canada is a work in progress and there is a long way to go to understand remaining potential and implications for future natural gas production. The advance of drilling and well completion technologies, including hydraulic fracturing, has opened up plays in a number of different basins that were not previously considered to have economic potential. The volumes calculated for gas-in-place are extremely large, and a small difference in the estimated percentage of gas-in-place that is recoverable has a huge impact on estimates of recoverable resources.
Newsroom
In the Classroom
About API
Print this page
API: Permit process in Alaska’s Beaufort Sea shows need for greater efficiency
More
API commends budget negotiators for not raising taxes in fragile economic recovery
More
--------------------------------------------------------------------------------
API Workshop on Commitment to Excellence in Hydraulic Fracturing - Oct. 4-5, 2011 - Pittsburgh, PA
API Storage Tank Conference & Expo - Oct. 17-20, 2011 - Las Vegas, Nevada
--------------------------------------------------------------------------------
IT Security
Partnerships in the Oil and Gas Industry
Energy Citizens
Oil Spill Prevention and Response
--------------------------------------------------------------------------------
Updated:February 1, 2010
Subscribe to:
Posts (Atom)