Ongoing litigation over EPA rules raises compliance risks and costs. North Carolina utilities, however, benefited from the state’s forward thinking.
Nuking the Tar Sands
Can nuclear heat allow for low-cost commercial reclamation?
shale has a low thermal conductivity that requires high temperatures to liquefy kerogen. Traditional recovery requires rapid burning by injecting oxygen, and by heating the shale with high-temperature electric heaters to 480 degrees to 540 degrees Centigrade (900 degrees to 1,000 degrees Fahrenheit) for two to three years to chemically convert and mobilize the kerogen. The produced kerogen is infused with hydrogen to produce SCO.
Subsurface retort technology originated by Shell Oil, called the In-Situ Conversion Process (ICP), allows more of the hydrogen molecules to be liberated from the kerogen and to react with carbon compounds over two to three years at a lower temperature of approximately 345 degrees to 370 degrees C (650 degrees to 725 degrees F). This process is reported to initiate chemical reactions that release light crude oil (65 percent) and syngas (35 percent) similar to natural gas. The electric power needed for the heating and cooling for a freeze wall perimeter can be generated entirely from the onsite syngas produced by the ICP. The conversion efficiency is 60 percent. This process requires 250-300/kWh of electrical energy per barrel of SCO. The ratio of energy produced to energy used is reported to range from 3-to-1 to 7-to-1, depending on the scale of the project.
Domestic oil-shale recovery using traditional recovery methods has been estimated to have a production cost of $35/bbl SCO. These economics require a $5/bbl production tax credit and a price guarantee (floor) in the low $40s/bbl (2006 dollars) for development of high-risk, cost-shared demonstration projects. 3 Due to continued hyper-inflation since 2006, the floor price could be in the low $50s/bbl. Shell’s ICP is reported to have a bitumen production cost of $30-$40/bbl in 2008 dollars. In addition, a demonstration plant is under construction in Utah, assisted by the Idaho National Labs and the DOE. It will use coal-gasification as the heat source. The production cost is reported at $30/bbl SCO. A sustainable WTI price of $50/bbl could provide a globally competitive risk-weighted return on equity with continued technology improvements.
Nuclear energy now is being proposed as an alternative to natural gas-powered electricity as a heat source for domestic in-situ oil recovery. Heat-transfer technology using nuclear power requires a downhole heat circulating system between cold and hot wells in the heat transfer loop with a high volumetric heat capacity to ensure efficient heat transfer.
Several existing reactor technologies could be used in oil-shale recovery. One near-term option is a high-temperature modular gas-cooled reactor. The long-term option could be the Advanced CANDU Reactor-700 (ACR-700 at 731 MW) and a very-high temperature, liquid-salt cooled reactor, the Advanced High-Temperature Reactor (AHTR at around 500 MW).
Non-Technical Nuclear Issues
There are fundamental uncertainties surrounding use of nuclear power in the proposed applications. The following questions frame them:
• Will the cost of input energy equal the price of output energy needed for a competitive ROI?
• Is there reasonable certainty of capital cost for nuclear capacity versus cost and price volatility of alternative combustion fuels?
• Can reactors be sized for “aggregated” extraction at multiple sites and well patterns,