Shell Oil Invests in Solar Startup to Boost Enhanced Oil Recovery


In the complex world of enhanced oil recovery (EOR), sometimes low-tech trumps high. Case in point, Royal Dutch Shell recently became the second oil major to invest in solar energy to coax heavy crude from older wells. Along with with two other investors, they've pumping $26 million into busy California startup GlassPoint Solar, because its low cost technology works so well in the dusty, dirty and often remote terrain of oil exploration (read press release).

Inexpensive sheets of aluminum

By 2011, when the company was only in its third year, GlassPoint had already installed its first system in an aging, oilfield in Coalinga, California for Berry Petroleum. It was an inexpensive 300 KW system (

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) with mirrored troughs enclosed inside a glass greenhouse. Shielded from wind and dust, the shiny mirrors could be fabricated from thin,

inexpensive sheets of aluminum, which the company makes in China. Almost all other materials - the greenhouses, steam pumps, and pipes - were bought right off the shelf in what must have been a classic Home Depot shopping spree.

GlassPoint dropped the new solar plant seamlessly into the oilfield's existing steam injection system. Then, as the mirrors concentrated sunlight on water-filled pipes suspended from the glass roof, the water was turned into steam and injected deep underground, heating and loosening up heavy, gunky crude, and transforming it into lighter oil pumped to the surface.

Unprotected heliostats

At the same time, competitors Chevron and Bright Source built a rival 27MW project just miles away (

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), which used 3,822 expensive and unprotected heliostats, consisting of two 10' x 7' mirrors mounted on a steel pole.

Sychronized by automated hardware, each heliostat tracks the sun's arc on two axes, intensely focusing the rays on a nearby receiver at the top of a 327-ft tower.

Jerry Lomax, Chevron's vice-president of emerging energy, told Oil and Gas Journal that problems at Coalinga included dust, wind, and hail. Any time the wind picked up to more than 25 mph, the large, heavy mirrors had to be put in the rest position, parallel to the ground. Whenever dust coated the mirrors, they had to be turned away from the sun, perpendicular to the ground, so a driver in a truck could drive past each mirror with a big roller brush. And that wasn't just any truck. To cut water use, Chevron had to buy a specially designed Israeli-made machine that uses less than 1 liter of water to clean each heliostat's set of mirrors.

Meanwhile, Glasspoint's technology further reduced costs by having automated washing equipment that travels on the outside of the greenhouse. GlassPoint's system also uses low-quality process water from the oil field, saving even more money.

Bright Source never expected to turn a profit on its work for Chevron (some say the company saw it more as a demonstration for utility solar projects) and set aside $40 million to cover losses. Glasspoint says it can build its projects at a profit and has already found another EOR client.

Twenty-seven times larger

In October, working with Shell, Total and the Government of Oman, GlassPoint finished building the Middle East's first EOR solar steam generator in a remote

desert location similar to so many oilfields - windy and dusty - where its low-cost technology thrives. Twenty-seven times larger than the system installed in California, it feeds 11 tons/hour of steam directly into the field's network.

Meanwhile, Chevron is still considering using solar energy to produce the steam needed to pump heavy crude from an oilfield straddling Saudi Arabia and Kuwait, and may start a pilot solar plant at the end of 2013. But the company is still assessing the use of solar energy as it seeks to free up much-needed natural gas, which Kuwait buys in liquid form at high international prices.

GlassPoint is almost finished commissioning the 7-megawatt solar array in Oman. Glass Point CEO Rod MacGregor said 80% of the steam currently produced using gas could be replaced by solar-generated steam and will allow Oman to reassign the gas for other uses.

Access to new oil fields

Mark Carne, the regional executive vice president at Royal Dutch Shell, who has followed Oman's story since he worked there in the early 1990s, talked about Oman's EOR efforts: "It's almost a microcosm of what will happen in the Middle East and North Africa," he told The National, which covers the oil industry in the Middle East.

Shell's involvement should help the startup take its technology worldwide. "You bring in much more than money," said MacGregor. "In this case, it could be access to other oil fields." To Reuters, he called the region "a perfect storm for us... you have heavy oil, you have a shortage of gas and you have abundant sunshine." And he knows the true value of his technology,"...One of the things about solar is it frees up gas. If Oman were to do 30 percent of its EOR with solar [instead of gas], it would become a net gas exporter again."

Is this a good use for concentrated solar power?

Photos: various, GlassPoint

Comments

Kent Harrington's picture

Yep. And becoming more integrated into the conventional energy infrastructure.