HTL Value Proposition

There are significant quantities of heavy oil throughout the world, most of which have not been developed due to the logistical challenges and cost of production using conventional technologies.

These challenges result from four key characteristics associated with heavy-oil development:

• Heavy oil is viscous and dense, and often requires steam to be injected into the reservoir to reduce viscosity and allow it to flow to the surface.
• Once at the surface, heavy oil frequently requires light oil to be blended with the heavy oil to allow the oil to flow in a pipeline.
• The value of heavy oil is less than light oil, because the oil requires pre-treatment before final refining.
• Traditional heavy-oil upgraders have a very large economic minimum scale - around 150,000 barrels per day - as well as a very high capital cost per barrel of capacity.

The net result is that significant known quantities of heavy oil remain undeveloped.

Integrated HTL development solves each and every one of the four challenges outlined above:

• Energy produced from upgrading by-products is largely sufficient to run the facility and also to meet the requirements of the field.
• HTL upgraded oil meets pipeline specifications and does not require diluent for transport.
• HTL upgraded oil is more valuable than raw heavy oil, allowing the producer to capture the majority of the heavy-light differential.
• HTL facilities are cost-effective at scales as low as 10-20,000 barrels per day.

Integrated HTL heavy-oil production can add incremental economics and lower risk in heavy operations with established infrastructure, such as the Athabasca oil sands in Canada, and it also is able to free the value of stranded oil in fields that cannot be economically produced using conventional technologies, such as Pungarayacu in Ecuador.