HTL updateFor those who have not seen this report:
Ivanhoe uses HTL to lower Ecopetrol oil viscosity
2013-11-20 08:01 ET - News Release
Dr. Michael Silverman reports
IVANHOE ENERGY SUCCESSFULLY UPGRADES ECOPETROL CRUDE FEEDSTOCK; MOMENTUM BUILDING TO COMMERCIALIZE HTL
Ivanhoe Energy Inc. has successfully upgraded heavy crude oil extracted from Ecopetrol's San Fernando T2 formation in Colombia from high-viscosity eight-degree-API crude oil to a low-viscosity 15-degree-API synthetic crude oil using Ivanhoe's proprietary partial upgrading process, Heavy-to-Light. Ecopetrol is the largest company in Colombia and is one of the four principal petroleum companies in Latin America.
The successful tests at Ivanhoe's feedstock test facility in San Antonio, Tex., demonstrate the flexibility and robustness of the HTL upgrading process to convert diverse heavy crude feedstocks into high value, marketable and pipeline-ready synthetic crude oil. SCO carries a market value near to Brent crude, a significant improvement over the value of the original crude oil.
The SCO produced by the HTL process has a low viscosity and is pipeline ready, which eliminates the need to blend the crude oil with diluent in the production field. Ivanhoe has recently conducted several tests at the FTF that demonstrate the stability of the SCO product in relation to transportation and refining systems. Additionally, refinery pilot plant runs conducted at the Southwest Research Institute demonstrate that HTL SCO produces specification gasoline, jet and diesel fuels.
"As demonstrated by test runs conducted in our FTF facility, the HTL process can upgrade heavy oils of different qualities," said Dr. Michael Silverman, Ivanhoe Energy's chief technology officer. "Current market conditions and our advanced state of commercial readiness creates opportunities to install Ivanhoe's partial upgrading process globally."
Heavy oil resources will become an increasingly important component of the global oil supply, with produced volumes growing by 50 per cent over the next 15 years according to the International Energy Agency. However, several constraints currently limit the economic feasibility of developing these resources.
Price differentials between heavy and light fractions of crude oil have been wide and volatile over time. This market dynamic is likely to continue as a result of increasing demand for distillate fuels, decreasing need for residual fuel oils and heavy oil production growing faster than refinery heavy oil conversion capacity.
The current practice of diluting heavy crude oil with light crude oils or gas condensate to render it transportable is costly and inefficient.
Heavy crude oil requires substantial energy to extract from the reservoir as compared to lighter grades of crude oil.
A paradigm shift in the industry is under way toward process intensification where coke is removed from the heavy oil close to the production site. This shift reduces heavy oil field development challenges and provides both economic and environmental advantages. HTL, Ivanhoe's partial upgrading technology, will play a significant role in this paradigm shift.
Reputable consultants to the energy and chemical industries, the Kline Group, completed an evaluation which compares HTL to more than 10 other upgrading technologies under development today. In this comparison, the Kline Group concluded that HTL is the leading partial upgrading technology based on five significant advantages:
- It is a novel carbon rejection process that is best suited for application in the field;
- It produces high yields of valuable, transportable SCO;
- It is in an advanced stage of development;
- It requires lower capital costs;
- It requires lower operating costs.
Ivanhoe will deploy HTL on its own heavy oil resources and has been developing several onshore and offshore projects in which third party heavy crude oil will be partially upgraded for a service fee. A number of business development projects are progressing with further news anticipated in the coming months.
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