Light-shale oil boom will not change US trend to refine heavy crude

07 March 2012 03:10  [Source: ICIS news]

HOUSTON (ICIS)--The rising production of shale oil in the US will still be too small to change the nation's larger trend in refining heavy grades of crude, speakers said on Tuesday at an energy conference.

Producers are unlocking new oil reserves by using similar techniques employed for shale gas.

The result is shale oil, which has so far proven to be of a lighter grade, said Bill Sanderson, vice president of IHS Purvin & Gertz, an energy consultancy.

Sanderson made his comments during a panel discussion at IHS CERAWeek, which is being held at Houston in Texas on 5-9 March.

However, shale-oil production is still too low to offset the large amounts of heavy crude processed by US refiners, Sanderson said.

“You will need a huge volume of very light material to completely change that picture,” he added.

Shale oil can be blended into the heavier grades, said Iain Conn, CEO of refining and marketing for BP, who also spoke at the panel discussion.

In addition, splitters can be built to remove the condensate and lighter fractions from shale oil, Conn said. These can be blended into fuel.

US-based refiner Calumet and WBI Holdings are studying the feasibility of a 20,000 bbl/day diesel refinery in North Dakota.

If the refinery is built, it will process Bakken crude and market it in the region.

By: Al Greenwood
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