Eesti Energia: co-operation worth considering for diesel production from shale oil

Eesti Energia has begun negotiations with other shale oil producers in Estonia in order to weigh the possibility of establishing a joint refinery for diesel production, suitable for use as a car fuel, from shale oil. An analysis (FEED) conducted by international engineering company FLUOR B.V showed that Estonian shale oil could be used to produce Euro 5 diesel, but establishing a refinery would be economically more rational if one with greater capacity was established.

According to Igor Kond, the head of Eesti Energia Oil Industry, the after treatment project shall be continued by looking for possible alternatives. “The fact that our crude oil is of sufficient quality for producing Euro 5 diesel confirms our objective of moving towards diesel production. Now we are analysing what other oil refinement options exist, in order to find the most optimal technical and economical solution,” said Kond. “One option is to establish a bigger refinery with other oil producers. We have made a proposal to both VKG and the Kiviõli Oil Shale Processing & Chemicals Plant to study the possibilities for establishing a joint refinery,” explained Kond. In addition, the outsourcing of the crude oil refining service, as well as selling crude oil to partners who would organise the refinement process themselves, is also being considered.

Conducted experiments show that after refinement one tonne of oil shale yields about 120 kg of quality liquid fuels, of which about 70 kg is diesel that meets the Euro 5 standards. In connection with the analysis of the new prospects, the initial 2016 deadline for diesel production will be pushed back.

Last year, Eesti Energia produced the biggest amount of shale oil (211,075 tonnes) in history. The profitability of producing shale oil is supported by the high global market price of heavy fuel oil that in the first quarter of 2013 averaged EUR 515.7 per tonne, which is 13% higher than in 2012.

Eesti Energia Oil Industry sells fuel oils made of oil shale with different usage properties. The products have a low sulphur content and low viscosity. The main consumers of Eesti Energia Oil Industry products are heating and power companies, road building companies, agricultural producers as well as ship fuel producers and sellers. Besides fuel oil, Eesti Energia Oil Industry also produces retort gas that is used for electricity production at Narva Power Plants.

Eliis Vennik
Eesti Energia
Press Officer
[email protected]
+372 715 12 18
+372 57 830 756