Resource World Magazine

j u n e / j u l y 2 0 1 5 www.resourceworld.com 55 the oil patch report B r u c e L a n t z mCW energy develops waterless oil extraction A new technology to circumvent environmental hurdles plagu- ing oil extraction has been developed by a Canadian-registered company. MCW Energy Group Ltd. [MCW-TSXV; MCWEF- OTCQX], with offices in Toronto, Utah and California, has developed an environmentally-safe, continuous flow closed-loop technology which extracts oil from a wide range of oil and other hydrocarbon sediment types using a fluidized bed extractor that uses no water in the process. The closed-loop technology may also be applied for remedial projects such as tailings ponds. "It's game-changing technology," said Paul Davey, MCW's Communications Officer. "A lot of people have tried it but the proof came last October at our grand opening after five years of lead-up." He said it's the first of its kind proven to have commer- cial applications. MCW is focused on value creation of proprietary technologies for the environmentally safe extraction of oil from oil sands and oil shale deposits, with an initial focus on Utah and its first oil sands lease in Asphalt Ridge. After the launch of its first extrac- tion plant in Utah – America's first environmentally friendly oil sands extraction plant – the company is scaling up its capacity with several additional, higher-capacity extraction units within the state, which has more than 30 billion barrels of undeveloped but recoverable oil. Asphalt Ridge is one of Utah's eight major oil sands locations with more than 50 million barrels of undeveloped oil sands deposits. Over five years, MCW gradually enhanced and improved the efficiencies of its technology at each stage of fabrication, with bet- ter dryer/mixer components and a higher consistency of oil sands flow. The extraction technology is versatile: applicable to both 'water-wet' deposits such as the Alberta oil sands or the 'oil-wet' deposits typically found in Utah. In addition to using no water in the extraction process, it pro- duces no greenhouse gases and requires no high temperatures/ pressures. It extracts up to 99% of all hydrocarbons and recycles up to 99% of the benign solvents. The proprietary solvent com- position consists of hydrophobic, hydrophilic and polycyclic hydrocarbons. In testing, these solvents separated up to 99% of heavy bitumen/asphalt and other lighter hydrocarbons from the oil sands while preventing their precipitation during the extrac- tion process. MCW expects to recycle over 99% of the solvents. These fea- tures make it possible for hydrocarbon extraction from oil sands feedstock at mild temperatures of 50-60° C, with no vacuum or pressure applied. There's no need for tailings ponds because the only elements that leave the closed-loop system are the extracted crude oil and the cleaned sands, which can be placed back in the earth or sold as clean sand for construction or fracking purposes. "Nothing leaves the system except clean sand and the oil itself," said Davey. Another unique component of the MCW extraction process is the application of its own extractor, based on a proprietary, pat- ent-pending liquid fluidized bed. This liquid fluidized bed-style reactor is expected to provide continuous mixing of the solvents and the solid ore particles. In a January 2015 press release, MCW stated that its "process- ing costs have now been projected downwards to US $28 barrel… (due to lower costs of petroleum products such as propane, die- sel fuel, solvents and condensates.) The netbacks will obviously fluctuate in tandem with oil prices and oil products that we use. Keeping in mind that this is the formula and oil prices are US $53.00, thus the netbacks during this period would be around US $25 per barrel, which is still very good. Compare this margin to most of the mega oil sands producers whose costs are between US $65.00 to $72.00 a barrel." "We offer the lowest cost per barrel in the industry, in the $28 range, which compares very favorably with the $65-$70 a barrel it costs companies working in the Alberta oil sands," Davey said. MCW can "still make a dollar" with prices around $55. Now, MCW's focus will be on offering licenses for their sys- tem and collecting royalties. Davey said merchant bankers are "impressed" with MCW and there's interest in the system from Asia, primarily China. "We'll build it and then show them how to run it," Davey said. He also noted the system is attracting interest in the US and Europe. "But if someone new comes along, who knows?" he added. "We can still get more oil out than any other system and we can even handle oil shale. "There's big potential for us in Canada but it'll take a lot of work and discussions. We've proven up our tech- nology and we're open for business," Davey said. n The Asphalt Ridge, Utah, oil sands extraction plant. Photo courtesy MCW Energy Group Ltd.

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