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The electricity also heats up the formation near the well bore itself, allowing the heavy oil to flow better. Once at surface it can be transported via heated lines and put in heated storage tanks onsite.

Conventional technologies must also heat up the oil to get it to flow, usually by drilling two long well bores deep into the formation. Producers must then wait for the upper steam well to heat up the surrounding oil formation before oil starts to flow from the lower well.

Bell says that energy costs for EEOR are less than $4/barrel, and capital costs are less than $10/barrel on only a 20 bopd well. Another positive for EEOR is that it works at depths greater than 2500 feet, or 800 metres, while conventional SAGD only works above 2500 feet.

“The technology is not fully commercial yet”, says Bell. He doesn’t want to get into details but says they are now working on several projects.

“We found Deloro via our partners at Yet2.com. They didn’t have capital to do a steam project” and the reservoir characteristics were such that Bell thought it was a good fit.

“Capital costs will be a fraction of what they would pay for a steam operation and opex (operating costs) will be less,” Bell says.

EPI and Deloro have made one heavy oil well at Wilkie produce up to 19-25 bopd, and a second well has now been permitted. EPI is paying 50% of the well and will receive 50% of the proceeds until payout, and then goes to a 10% working interest.

EPI plans to use the success at Wilkie and its other projects to extend the use of the EEOR technology into bigger fields with larger working interests.

Copyright © 2010 Keith Schaefer
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Keith Schaefer, Editor and Publisher of Oil & Gas Investments Bulletin, writes on oil and natural gas markets - and stocks - in a simple, easy to read manner. He uses research reports and trade magazines, interviews industry experts and executives to identify trends in the oil and gas industry - and writes about them in a public blog. He then finds investments that make money based on that information. Company information is shared only with Oil & Gas Investments subscribers in the Bulletin - they see what he's buying, when he buys it, and why.

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