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Production of Synthetic Crude from Kerogen Trapped in Shale Advances Through New Technologies, Business and Industry Trends Analysis

While the U.S. has much smaller oil sands deposits than those of Canada, it is rich in a different unconventional oil formation: kerogen-rich oil shale. This is found as a rock formation containing the oil precursor kerogen, which can be processed into synthetic oil of very high quality, similar to sweet crude. Kerogen-bearing shales are younger, in geologic terms, than formations that contain crude oil. Natural forces have not yet converted the sedimentary kerogen deposits into crude.   (This type of field is not to be confused with the production of actual crude oil from shale in the Bakken Shale and other fields.) Oil shale yields between 10 and 60 gallons of kerogen-based oil equivalent per ton of rock. Vast reserves are in the Green River Formation in the Western U.S., including parts of Colorado, Wyoming and Utah. The richest U.S. fields (those that contain at least 15 gallons per ton) are thought to hold a total of 1.8 trillion barrels of oil equivalent.
During the 1970s, after the oil embargo crisis, the federal government strongly encouraged both energy conservation and alternative production. In 1979, it established the U.S. Synthetic Fuels Corp., endowing it with billions of dollars for research and development of new fuels. As a result, major oil companies attempted to commercialize oil shale, but those efforts were largely abandoned by the 1980s as oil prices fell. There were also concerns about environmental damage from shale mining, and there were many technical hurdles to face. Commercial production seemed impossible. By 1985, Congress killed the Synthetic Fuels Corp.


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