Shale oil : potential economies of large-scale production, workshop phase

Abstract

A workshop on shale oil, sponsored by M.I.T., was held on June 4-5, 1979. The purpose of the workshop was to identify technological opportunities for significant reduction in the cost of producing shale oil on a large scale (at least 2 million barrels per day). Large-scale production of shale oil is of current interest as one of the alternatives for reducing imports of petroleum. The workshop participants included 11 industry and 9 M.I.T. people expert in technologies or approaches potentially applicable to shale oil. The participants reached general consensus on three major conclusions: - Large-scale production of shale oil would make possible a reduction of cost through new technological applications and innovations. There are opportunities for new technology in individual mining, retorting, and upgrading steps. Perhaps more important, there are also opportunities for combinations of technology which would make best use of various processing methods, the natural resources in place, economies of scale, the mix of products, etc. - A shale oil industry must exist and must be producing shale oil on a meaningful scale in order to develop these improved technologies most effectively. This is particularly true for those technologies whose impact is on the whole system (such as combinations of technology) rather than on individual process steps. If industry growth is not accelerated, it will be a long time before shale oil can contribute significantly to easing U.S. energy problems, and current technical, economic, and environmental uncertainties will remain uncertainties. - Creating a large-scale shale oil industry soon would require capital, human skills, and materials well beyond the capacity of one company or a small group of companies. Those needs, plus some unique characteristics of the shale land (its federal ownership, and its concentration with consequent potential for heavy local impact on population and envrionment), suggest the desirability of a new structure to manage U.S. shale resources in the common interest. That structure would include some type of joint participation by the private sector, the public, and government (federal, state, and local) to ensure getting contributions and cooperation of all affected groups, and to best meet all their needs.