Canadian Oil

[Tackler]

Petrostar says DHT can reduce CO2 emissions

2007-06-11 15:11 MT - News Release

Mr. Robert Sim reports

PETROSTAR PETROLEUM ENHANCED OIL RECOVERY TECHNOLOGY PROJECT UPDATE

Petrostar Petroleum Corp.'s downhole hearing device (DHT), in addition to increasing well production by up to 600 per cent, has significant and secondary application potential as a replacement to current production tank heating systems otherwise known as propane or gas-fired tank heaters (burners). Current heaters are used to heat the tank oil and maintain it at approximately 70 degrees Celsius, which is a significant operating cost, especially during colder months. In addition to the operating costs, the burner system emits potentially harmful carbon dioxide (CO2) emissions. Petrostar's improved electric tank heater (ETH) will lower operating costs by reducing consumption of fossil fuels. Additionally, the improved ETH is not only more economical then the current system but, more importantly, it emits zero CO2 emissions. This would be a major development to help Canada's oil industry meet or surpass the standards put forth by the Kyoto accord. The company plans on approaching the regulatory agencies to discuss implementing a program that, if endorsed, could offer producers an incentive to change. The company plans to initiate a test on one of its tanks as soon as it can complete fabrication of the equipment.

Enhanced oil recovery update

Field testing of Petrostar's proprietary DHT on its 15/6 is under way and will continue for the next few weeks. Test results previously announced on well 9/6 resulted in a 600-per-cent fluid production increase over the testing period.

The testing will be carried out by its new prototype design which will increase downhole temperatures to approximately 225 degrees Celsius with time to achieve the said temperature and allowing maintenance of the said temperature for longer periods of time. In addition, the placement of the DHT and water injection has been refined by incorporating new sensors that allow it to maintain steam and deliver heat and pressure to the production zone. These refinements should enable the DHT to be effective not only in heavier oil but lighter oil where waxing is a production problem. Currently the oil industry uses a system whereby oil is heated on surface then pumped down the well casing where it temporarily reduces the waxing problem. The DHT will create a constant temperature at the formation level and provide a longer-term solution. A major oil and gas producer has made inquiries to the company in regard to its wells in southeastern Saskatchewan where waxing is a prominent problem with CO2 injection fields. Petrostar's oil field superintendent feels this could be a major breakthrough for the oil industry and at a very significant cost saving.

The success of the downhole tool test is viewed as a significant milestone achieved by Petrostar and it brings the company closer to commercializing this revolutionary enhanced oil recovery technology. The company believes it can deliver the DHT at a cost that can effectively and economically increase the production of thousands of proven North American medium-oil and heavy-oil wells. Needless to say, the opportunity of penetrating this market is substantial.