10 Jun 2013
Oil Gives Energy Independence, Jobs and Prosperity
Sandor Liive´s Opening Speech at the International Oil Shale Symposium 2013.
Minister Parts, members of the Parliament, Your excellencies, professors, ladies and gentlemen, I am proud to welcome you to the 4th International Oil Shale Symposium here at Tallinn University of Technology.
The first time academics and experts gathered here in this university for an oil shale conference was in 1968. 1968 – the Estonian oil shale industry was already 54 years old and during that time oil shale has provided electricity and heat to the capital and provided motor fuels for cars and ships as well as gas for St Petersburg. By 1968 the 1624 MW Balti Power Station had been in operation for 2 years already and the first block of the 1610 MW Eesti Power Station was under construction.
1968 – the oil price was 11 US dollars per barrel.
The second time the oil shale symposium was held in Estonia was in 2002. That was the year we introduced a new technology in oil shale power production – the CFB boilers. This new technology in these 430 MW boilers significantly reduced air emissions and increased efficiency.
2002 – the oil price was 24 US dollars per barrel.
The third time the symposium took place in 2009. It was the year we decided to construct our new Enefit280 Oil Plant. The Enefit280 Oil Plant is based on our 30 years of operational experience, is twice scaled up, has an intergrated CFB boiler and has higher energy efficiency and lower environmental impact.
2009 – the oil price was 70 US dollars per barrel; the level that makes shale oil production profitable.
And here we are today, the 4th International Oil Shale Symposium, in June 2013 – over 400 experts from 30 countries. Today the construction of the Enefit280 is complete and the plant is under hot-commissioning, the first oil has been produced. We have not yet reached full-scale continuous production, we are overcoming some mechanical challenges. No-one ever said technology development was easy, but we are committed and confident that the plant will be in production before long.
Ladies and gentlemen,
Today is a very exciting time in our business. Prices are remaining high – the oil price is above 100 US dollars per barrel and the global need for energy continues to grow dramatically. Here in Estonia, never has so much been invested in oil shale than in just the past few years. In Estonia there has been 1 billion euros invested into our domestic oil shale industry:
- We are in the process of hot commissioning the world´s largest oil shale oil production plant, Enefit280,
- We are halfway through constructing a modern 300 MW oil shale and biomass fired power plant in Ida-Viru county,
- Our nearly 100 years of experience with oil shale has given us courage to expand to the US, the world´s largest oil shale resource with our project in Utah,
- And we are in final stage of the EPC and mining tender process for the Jordan 500 MW oil shale power plant that will help reduce that country´s energy crises.
Ladies and gentlemen,
As we look to the future, I’m pleased to say there is a great deal of excitement and anticipation as we, and other companies, explore new opportunities around the world. There have been 2 major changes that have revolutionized energy markets in the last 10 years, the development of Canadian oil sands and shale gas boom in the US. The combination of time-tested techniques such as horizontal drilling and hydraulic fracturing has quickly allowed the US, for example, to become a major energy producer. The International Energy Agency projects that the U.S. will pass Russia and Saudi Arabia as the world’s top oil producer by 2020, if not before.
Today we look forward to yet another significant energy change – the global development of energy from oil shale. The reality is that the time is right for oil shale development.
- The resource is abundant and well-known. We know where the world’s oil shale reserves are, we know the quality of them and we know how to access them. That’s the great thing about rock, it doesn’t move and it changes very, very slowly. Oil shale doesn’t have the exploration risk of conventional oil and its reserves are at least 4 times larger than all crude oil reserves. It´s no wonder that Jack Gerard, CEO of American Petroleum Institute, has called oil shale the next bonanza.
- Technologies are proven. While there is plenty of oil shale research and development ongoing – just as there is in other parts of the oil and gas industry – the fact is that we have viable technologies for producing energy from oil shale.
- Industries are operating in several countries. In addition to our long history of working with oil shale in Estonia, commercial oil shale industries are operating in Brazil, China, Israel and, in the near future, in Jordan and the USA.
- Lastly, and critically, crude oil prices have remained high enough to support development. While it’s difficult to project the future with any degree of accuracy, projections from the International Energy Agency and others suggest that oil prices should remain stable and at a level that makes oil shale profitable.
To be sure, we as a company – and, collectively, we as an industry – have great reasons to be optimistic about the future.
As we develop projects abroad, though, another challenge we face is optimizing our processes and technology for different oil shales. Each oil shale is different and no one has yet succeeded in creating one technology that works perfectly with every oil shale. There is no off-the-shelf solution; we have enough experience to recognize that some steps in our process will need to be changed for other shales.
Although there is no one-size-fits-all approach to different oil shales, we have some advantages which give us confidence:
- We have a proven technology and process that works well with Estonian oil shale and, in many cases, can be adjusted for different oil shales.
- We have decades of expertise in operations, environmental compliance, and development. We know what it takes to get the job done.
- We have built up testing capabilities (pilot plant) in Frankfurt, which allows understanding differences in oil shales and modifying our process to take these differences into account.
- We also know that, for this industry to be successfully established on a large scale in many different locations, we must all work together. There’s no need for each of us to reinvent the wheel; sharing best practices at events such as this is vital to our collective success. This helps us recognize what works and what doesn’t work for different shales.
During the next two days, you’ll hear more on these topics and the valuable lessons we have learned from some of our most gifted and experienced employees, and from industry leaders and experts from around the world.
Ladies and gentlemen.
Oil gives a country´s energy independence, jobs and overall prosperity. Interest in unconventional energy resources is skyrocketing globally, so we can be excited to be a part of the next global energy revolution – oil shale.
International Oil Shale Symposium