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Iran Widens Discount For Crude To Asia

Iran Widens Discount For Crude To Asia

Iran has deepened the discount…

Can Bitumen Pellets Make Oil-By-Rail Safer?

Canada

A Canadian engineer and his team accidentally discovered a way that could make transporting heavy Alberta crude by rail much more safely. In fact, the bitumen pellets that Ian Gates and his co-workers came up with could make oil transportation safer than pipelines.

Gates, a professor at the University of Calgary’s Schulich School of Engineering, and his team were working on ways to make the bitumen extracted from the oil sands of Alberta less viscous, but instead they inadvertently found a way to make it more viscous, CBC reports. Then they found out that this highly viscous matter could be turned into self-sealed pellets with a highly viscous coating and a liquid core.

The method, which involves applying heat and pressure to the bitumen, is cheap – as cheap, the team says, as adding diluent to the bitumen to make it liquid enough to be transportable via pipelines. The heat and pressure result in the formation of a tough coating rich in asphaltene that envelops the liquid core.

The conversion can be applied at the wellhead, with the pellets then transported to export destinations by regular rail cars – the same ones used to transport coal. They could also be transported by trucks. After they reach their destination, the pellets can either be reconstituted into bitumen or used as-is, for road paving for example, Gates says.

The pellet-production technology is fully automated, and within the next couple of months it will be able to produce several barrels of bitumen pellets daily. Within a year, Gates says, the production capacity could reach several hundred barrels per day.

Related: The Wealthiest Oil & Gas Billionaires In The U.S.

There are already energy companies interested in the commercialization of the technology.

Alberta is Canada’s biggest oil producer and home of the world’s third-largest oil reserves, after Venezuela and Saudi Arabia. Reserves as of last year were estimated at 165.4 billion barrels. Oil output in 2016 averaged 2.5 million bpd.

By Irina Slav for Oilprice.com

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  • Ron on September 07 2017 said:
    The only issue I can foresee is the transportation costs. We've all seen the rocks in the beaker and been asked if it's full. Then smaller rocks, then sand then water. The interstitial space would mean up to double the transportation costs via traditional rail strictly on a volume basis.

    No doubt it would be safer but more costly. How can Canada compete with the Saudi & other Africa/Middle East oil when they have such low cost structures due to no regulatory restrictions?

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