Energy, Mineral Resourcesand the Human impact on the

Environment

Fundamental Concepts

• The Earth is our home and must sustain us

• The earth is a closed system

• The Earth’s population is growning

      The desire for higher standard of living       Standard of living is resource based

Resources

•  The use of resources will continue to expand

• Resources are not equally distributed and generally distant for consumption

• High grade resources are already depleted and lower grade resources are currently being consumed

Resource Triangle

Resource Actions

• The choice to use a resource in one way is a decision not to use it in all of the other potential ways

• The consequences of actions are numerous and generally unanticipated

• The environmental effects are cumulative (both linear and exponential)

Cost

• Direct Cost – The cost of all activities (exploration,

extraction, processing, distribution) that show up on a corporate financial report.

• Indirect Cost– The cost of all activities caused by

exploration, extraction, processing, distribution but not paid internally.    This may also be called the societal and/or the environmental cost.

Environmental Costs

• Exploration

• Development

• Production

• Transportation

• Refining

Petroleum

• The geological Search of Oil (and Gas) begins with exploration for right set of conditions (6 conditions)

•1.     a source rock            Black Shale (color result of organic carbon content)            Marine planktons

The geological Search of Oil (and Gas)

• 2.    a reservoir rock            Sandstone or limestone with high porosity and permeability

• 3.    a trap

Geological structure where oil can accumulate (folds, faults, unconformities, facies changes)

Most located in 1940s and 50s

The geological Search of Oil (and Gas)

• 4.    sufficient burial to cook to source rock             Some specific fossils (conodonts) are excellent thermometers  

The geological Search of Oil (and Gas)

• 5.  Geologic history of fluid migration and entrapment

• 6 Proven production near by

Probability of a successful well

• Is a function of the six factors of exploration!

Scale of exploration

• Elephant Hunting >100 Million Barrels– Only the big boys play this game– < 1% likelyhood of success on single well

• New Field– About 3-5% success on single well

• New Pool– About 10% success on single well

• Enhanced recovery– About 60% success on single well

• Reentry– About 50% success on single well

Steps in Development

• Discovery well

• Permitted Out-step wells to delimit pool or field

• Infill to maximize exploitation

Rig Count• 1996 779 Rigs

– Texas 283

• November 2006 1,706 Rigs– Texas 614

• November 21, 2007 1,774 rigs– Texas 858– Illinois 0

• November 14, 2008 1941 Rigs– Texas 899– Illinois 1

Downhole Geophysical Log

Shallow and Easy, Cypress Sandstone

Deeper and Harder, Ste Genève, St. Louis and Salem Limestones

Types of Crude Oil• Paraffin-Base Crude Oils (Green)• These contain higher molecular weight paraffins which are solid at

room temperature, but little or no asphaltic (bituminous) matter.  They can produce high-grade lubricating oils.

• Asphaltic-Base Crude Oils (Black)• Contain large proportions of asphaltic matter, and little or no

paraffin.   Some are predominantly naphthenes so yield a lubricating oil that is more sensitive to temperature changes than the paraffin-base crudes.

• Mixed-Base Crude Oils• The "gray area" between the two types above.  Both paraffins

and naphthenes are present, as well as aromatic hydrocarbons.  Most crudes fit this category.

• Light – Medium – Heavy• Sweet - Sour

Refineries

• Last refinery constructed in US 1976!

• 1984321 Domestic Refineries

• 2006132 Domestic Refineries• Hyperion Resources plans to build an $8

billion oil refinery in the Midwest which will refine crude from the Canadian oil sands in Alberta to feed the U.S. market

Basic Refinery

• Refining and upgrading involves removing the "impurities", most of which become valuable by-products in their own right, and breaking down the complex hydro-carbon molecules, which characterize heavy oil, into simpler hydrocarbon molecules.

• Fractionating towers break down molecules but some resist the process.   Then the opposite tack is taken in the Hydrotreater which forces carbon atoms to accept more hydrogen atoms, also forming lighter, more useable molecules. 

Refinery Cuts

Energy Resource Triangle

Coal

Coal

Types of Coal• Coal Color Moisture Fixed Heating• Carbon Value (BTU) • Lignite Brown 43% ~ 7,000• Subbituminous Black 70% 9,000• Bituminous Black 5% 80% 13,500• Superbituminous Black 83% 16,000• Anthracite Black (Vit) 2% 90% 13,000

Strip Mine

Cartoon of Wyodak Coal near Gillete, Wyoming

• Subbituminous coal

• Clinker

• Bituminous Coal

Wyodak

Coal Bed Methane

Underground Coal Mine Map, Bloomington, Illinois

Longwall Retreat

Shaft

Room and Piler Coal Mine

Coal Mine Map, Springfield, Illinois

Futuregen

• FutureGen is the first of its kind coal-fueled power plant that will link state of the art technologies to produce electricity and hydrogen with near-zero emissions.

• The Department of Energy announced plans to build FutureGen in 2003. By May 2006, 12 sites in seven states applied to host the plant. In July 2006, the FutureGen Alliance announced the four finalists for the facility: Mattoon and Tuscola in Illinois; and Jewett and Odessa in Texas.

• Mattoon was selected December 2007

• The $1 billion project is a government-industry partnership between the U.S. Department of Energy and the FutureGen Alliance, a consortium of the world’s largest coal and energy producers.

Futuregen, Illinois

• Coal GasificationFutureGen will utilize coal gasification technology to supply enough electricity for 150,000 U.S. homes, producing an output of approximately 250 megawatts. Gasification will also produce significant amounts of clean hydrogen. This hydrogen can be used in fuel cell technology that will serve as the next generation “battery” to operate everything from a computer to a car.

Carbon Sequestration

• Currently, about one third of the carbon dioxide emissions released into the atmosphere come from power plants and other large point sources. FutureGen will employ technology to stem and eventually decrease the amount of greenhouse gas released into the air. Carbon sequestration technology allows for the capture and storage of the emissions in geological formations deep underground.

Electric Generation

• Alternating Current (spinning generator)– Hydro power– Wind power– Steam

• Direct Current– Solar– Battery– Fuel cell

Moderators

• Water

• Carbon

• Beryllium

• Lead-Boron

• Lead-Bismuth (poison)

Environmental Concerns

• Reactor Events– Homer Simpson– Three Mile Island (1979)– Chernobyl (1986)

• 5% reactor core injected into atmosphere

• Uranium Fuel stream– Mining– Fuel enrichment

• Spent Fuel

Nuclear Waste Types

• Low Level– items that have become contaminated with

radioactive material or have become radioactive through exposure to neutron radiation. This waste typically consists of contaminated protective shoe covers and clothing, wiping rags, mops, filters, reactor water treatment residues, equipments and tools, luminous dials, medical tubes, swabs, injection needles, syringes, and laboratory animal carcasses and tissues.

• Low Level Repositories– Short half-lives <ka– Local compacts

Nuclear Waste Types

• High Level Waste– Transuranic materials– Long half-lives >ka– Currently stored on site– Federal repositories

• Waste Isolation Pilot Project (New Mexico)• Yucca Mountain (Nevada)

Mineral ResourcesMineral Resources

Examples of Common Mineral Resources

High Grade Gold Ore

• At today’s price, gold is economic to mine at about 1 gram/ton

• High grade ore runs over 10 grams/ton

Types of Resources

• Metallic Resources–  Metals recovered by smelting

• Nonmetallic Resources – Used for properties

• Aggregate (Sand, Gravel, Crushed Rock) in Concrete• Cement (Limestone, Gypsum, Clay)• Glass (Silica Sand --- St. Peter Sandstone)• Computer Chips (Quartz, Rare Earths)• Ceramics (Feldspar, Kaolinite)• Cleaners and Filters (Fullers Earth, Borax) 

Concentration factor from natural abundance to refined metal

Steps in Developing a Resource

• Literature Review (look where it has been found)• Hammer survey (feet on the ground geology)• Lease prospect (usually a two tiered lease)• Detailed geologic (and geochemical) mapping• Exploratory Drilling (nature and extent of resource at

depth)• Mine Design and Permits• Construction of Facilities• Advance Shaft or remove overburden to start mining• Production Boreholes to direct mining activities

Orezone Resources Inc. a combined core drilling Sega Project November 6, 2006. 

Section Zone Hole* From (m) To (m) Length** (m) Grade (g/t)

7675 RZ-VV RZC900 64 68 4 4.51

7700 RZ-VV RZC895 74 83 9 1.65

7825 RZ-VV RZD010 10.7 14.8 4.1 29.69

7850 RZ-VV RZD016 53 69 16 2.58

7875 RZ-VV RZD008 50 63.4 13.4 10.75

8365 RZ East RZD020 223 232 9 3.28

7850 RZ RZD023 152.5 161.5 9 1.11

7875 RZ RZD038 241 244 3 4.55

7900 RZ RZD037 229 235 6 59.08

7925 RZ RZD021 177 186 9 9.94

7925 RZ RZD022 218 222.5 4.5 13.25

7925 RZ RZD022 91 95 4 6.66

6775 Gambo SW GRC902 36 41 5 4.86

6825 Gambo SW GRC904 19 30 11 3.57

6850 Gambo SW GRC905 14 20 6 4.53

7270 Bakou BKD035 162.5 212 49.5 3.09

7270 Bakou BKD035 69 99 30 1.18

7350 Bakou BKD005 46 61 15 1.19

7375 Bakou BKD034 104 127 23 2.31

7375 Bakou BKD034 52 70 18 1.51

Mine Types

• Surface Mines– Open Pit– Strip Mine

• Underground Mines– Room and Piller– Stope– Longwall Retreat

Open Pit

Stope and Room and Pillar

Starts near property line and works inward allowing the mine roof to subside

Mine and Mill

• Ore is crushed

• Metal mineral extracted by chemical or physical process

• Metal mineral smelted to a pure metal

• Ore      An ore is the portion of a resource that can be extracted and refined at a profit.

• Reserves      Are the known amount of a resource economically recoverable with current technology.

• The tax law has special classes of reserves used to calculate depletion allowances, thus companies report only a portion of what they know!!!!

•

Historic Gold Processing

• Crush ore (Stamp Mill)

– Crushed to fine sand size

• Separate gold from ore by washing

– Long Tom, or Cyclones

– Fleece

• Concentrate gold

– Panning

Historic Gold Processing

• Crush ore (Stamp Mill)– Crushed to fine sand size

• Separate gold from ore by Mercury

• Separate gold from Mercury– Retort (distillation)– Chamois

Modern Gold Processing

• Crush Ore– Sand size (mill)– 3/8 inch (heap leaching)

• Chemical Separation– Sodium Cyanide

• Gold Recovery– Introduce tin to knock gold out of solution

• Cyanide Regeneration– Introduce Salt to knock tin out of solution

Cyanide Destruct

• Oxidation– Chlorine gas– Hydrogen Peroxide– Swimming Pool Chlorine Salt (bags)

• Biologic– Bacteria