CALGARY, Alberta, June 27, 2018 (GLOBE NEWSWIRE) — Questerre Energy Corporation (“Questerre” or the “Company”) (OSE:QEC) (TSX:QEC) reported today on the results of the technical and economic feasibility study for its oil shale project in Jordan. The design basis for the study is an initial project capable of sustaining production of 50,000 bbl/d. The study was conducted by Hatch Ltd., (“Hatch”), a global engineering firm.
Michael Binnion, President and Chief Executive Officer of Questerre, commented, “Completing this study is an important milestone. It validates our own technical and economic assessment of the project. The study estimates capital costs, including a 20% contingency, of US$18 to US$20 per barrel and operating costs of approximately US$18 per barrel. While these costs are very early stage, our project could be very competitive with other large energy projects. Our estimated costs include upgrading all the produced oil to low sulphur diesel and gasoline which, based on a study of the local market, typically realizes a US$10 to US$12 per barrel premium to Brent pricing.”
Commenting on next steps, he added, “Based on these positive results, we plan to move to the next phase of engineering with Hatch, known as pre front-end engineering design (“pre-FEED”) or FEL 2. The pre-FEED work will include the design and costing for a pilot project. It will also improve the accuracy of the current AACE Class 5 cost estimates above, which have an average accuracy of +100/-50%, to Class IV cost estimates which will have an average accuracy of +30/-20%. It will leverage the ongoing pre-FEED (FEL 1 & FEL 2) work by our partner, Red Leaf, on their EcoShale process for the project in Utah. Pre-FEED work for the retort is scheduled to begin next quarter.”
He further added, “Later this year, we plan to commence negotiations with the Jordanian Ministry of Energy and Mineral Resources for a concession agreement. We have been very pleased with their support and strong commitment to developing their natural resources. We are looking forward to finalizing the fiscal and other terms essential to the overall project economics and our ability to finance the next stage of development.”
The study follows the completion of nine independent studies covering all four aspects of the production of crude oil including mining and feed preparation, retorting, utilities and infrastructure and marketing and refining. The initial design basis was for production of 20,000 bbl/d. The recent study completed by Hatch integrated these studies with adjustments deemed appropriate for this stage including scaling them up to a capacity of 50,000 bbl/d to provide AACE Class 5 estimates of capital and operating costs. The 50,000 bbl/d capacity was chosen to capture some of economies of scale for the mining and upgrading components and to satisfy the local Jordanian market for imports.
Some of the key considerations for design of the commercial facility included minimizing water usage in one of the driest areas of the world, maximizing the generation of finished products, including diesel and gasoline, and generating sufficient power and heat internally to minimize imports. Based on its assessment of multiple retorting technologies, the Company believes Red Leaf’s reusable capsule EcoShale process has several advantages for the Jordanian oil shale. It efficiently heats and produces oil from the shale while capturing the produced water for future use in the process. This eliminates the need to source water. Based on recent testing of the Jordanian shale by Red Leaf, the Company estimates the yield as a percentage of Modified Fischer Assay (“MFA”) could be as high as 95% to 97%. Working with Red Leaf, the Company is optimizing the EcoShale process for its Jordanian oil shale with the goal of improving yields further.
Questerre Energy Corporation is leveraging its expertise gained through early exposure to shale and other non-conventional reservoirs. The Company has base production and reserves in the tight oil Bakken/Torquay of southeast Saskatchewan. It is bringing on production from its lands in the heart of the high-liquids Montney shale fairway. It is pursuing oil shale projects with the aim of commercially developing these significant resources.
Questerre is a believer that the future success of the oil and gas industry depends on a balance of economics, environment and society. We are committed to being transparent and are respectful that the public must be part of making the important choices for our energy future.
For further information, please contact:
Questerre Energy Corporation
Jason D’Silva, Chief Financial Officer
(403) 777-1185 | (403) 777-1578 (FAX) |Email: info@questerrehttp://www.newsweb.no/index.jsp?messageId=454579