Dragon Shale has brought together an exceptional group of engineers, scientists, financial and management personnel with the end goal of implementing oil shale projects.
Our studies indicate that by producing both high value products and fuels oil shale will become an important, secure, cost effective and reliable source of both products and energy in the near and intermediate term. Oil shale projects have previously overlooked high value derivative products unique to retorted Kerogen. There are two key aspects to our strategy; deploy and further develop appropriate technologies and identify and develop suitable resources.
First Joint Venture
Dragon Shale, LLC is a technology development and project management company with specialized expertise in the oil shale industry.
Dragon Shale will use this expertise to select the proper technology, business models, product mixes and organization structures to launch commercially successful oil shale projects. In this way Dragon Shale will avoid the many pitfalls that been encountered by others in this challenging field.
The first such project we have selected is on land privately owned by CUOS in eastern Utah. Our intention is to design, build and operate a plant with an expected lifetime of twenty years. Our estimations are that over this lifespan we can obtain approximately fifty two million barrels (52M bbl) of high value product with total revenue of $3.3B. This will equate to an internal rate of return of 20%.
We plan to deploy the best available technology that meets the basic needs of all stakeholders for individual projects.
Based on Dragon Shale’s research and understanding of the chemistry of oil shales much is needed in the area of technology development if it is to become a significant and responsible optional source of high value products and fuels. Hence Dragon Shale is developing its own technology to enhance yields, improve oil quality, reduce carbon foot print and mitigate financial and environmental risks. Specifically Dragon Shale is developing technology which is designed to enhance hydrogen transfer into the synthetic crude oils produced by leading current conventional retorting technologies. Preliminary work indicates that these performance enhancements may be applicable to some of the existing technologies available to the industry.
The issues facing the oil shale industry are not just the nuts and bolts of mining, extraction, upgrading, etc. These many issues interact in complex ways to drive many different cost/benefit evaluations. Dragon Shale has learned through studies of failed projects that a key to success is implementing “right size” projects. Usually smaller than historically attempted that allow tuning to the unique characteristics of specific oil shale resource and local logistical, environmental and market conditions. Further Dragon Shale has concluded from studies of failed projects that setting big oil expectations for exploiting resources from federal, state and private lands has often left resource caretakers and other stakeholders out of the loop in contributing to project success, often resulting in antagonistic relationships. Dragon Shale believes it is critical to technology implementation to engage all stakeholders in the technology selection and application process and to contribute to the decision making process which will always involve commercial and environmental considerations.
Working with the client Dragon Shale evaluates the commercially demonstrated technologies in order to select one most suited to the specific qualities of the client resource. The aim being to implement a solution to achieve the best technical, commercial and environmental match between the extraction and conversion process and the resource. Dragon Shale then further applies its own process technology through the development of the project plans to design, construct commission and operate projects exceeding the best otherwise existing technology and resource combination.
Further experimentation and development is also being conducted which is expected to deliver a new process design. This technology when made available to Dragon Shale clients will be retrofitted to their existing operating infrastructure. Providing significantly higher total yields and product qualities while further reducing the total operating cost and environmental footprint. Thus delivering to Dragon Shale clients an industry leading commercial and environmental advantage.
Certain logistical advantages have made the property owned by The Colorado Utah Oil Shale Company Inc. (CUOS) an ideal place to implement existing, well tested technologies on a relatively small scale.
Dragon Shale LLC and CUOS have forged a strategic partnership to deploy the best available technology for production of synthetic crude oil from the CUOS oil shale resource. Rather than simply sell a low value synthetic crude for processing by others, process adjustments to maximize the yield of high value components will be made. This project will be implemented as a joint venture with Dragon Shale and CUOS.
This first project will focus on the best available, proven technologies so as to reduce business and technical risk. The plan will not, however, be completely unresponsive to newly developed and proven technologies. The project will likely span twenty years, during which time Dragon Shale will continue to develop its own technologies and partner with others to improve oil shale technology.