The company said Monday it had signed a memorandum of understanding with Moroccan state energy company ONHYM to acquire exclusive rights to a 36-square kilometre block in the Timahdit oil shale deposit.
According to San Leon, the Timahdit deposit in the awarded area yielded an average of 99 litres per tonne of shale oil in the rich layers. It is also considered to have significantly less moisture content than many other international oil shale deposits.
Over a two-year period, San Leon planned to evaluate the commercial viability of a surface retorting (the process of yielding shale oil through pyrolysis and vapour condensation) project.
It said recent analysis by Enefit OutotecTechnology, EOT, confirmed that the Timahdit oil shale had commercial potential using EOT’s surface retorting process and further raw shale oil upgrading.
According to EOT, the project would suit an initial retorting unit to produce 3600 barrels per day of raw shale oil. Two additional units could be added to boost output to 11,000 bpd and would include syntehtic oil upgrading and power generation facilities.
San Leon said planned to select a large sample of the Timahdit oil shale for extensive evaluation in EOT’s laboratories in Frankfurt, Germany.
San Leon chairman Oisin Fanning said the award of Timahdit demonstrated the company’s commitment to establishing a major shale oil project in Morocco.
“Based upon the results of the recent analysis by EOT and current oil prices we are committed to a feasibility study evaluating the commercial potential of the Timahdit oil shale,” he said in a statement.