The Differences Between Shale Oil and Oil Shale

Hydraulic fracturing, or fracking technology, has allowed gas and oil producers to tap into shale reserves around the world. The oil removed from the shale is known as tight oil or shale oil. However, oil shale production is different than shale oil. Below is a brief look at the differences between these very similar-sounding sources of energy.

Pre-Oil Rocks

Oil shale is rock containing kerogen bits—kerogen is an oil precursor. All oil is made from organic matter that has been subjected to intense pressure and heat until it degrades into hydrocarbons. With kerogen, the heat and pressure weren’t quite enough to finish the conversion process.

However, that can be remedied via two different methods. One is to mine the rock and heat it in a low-oxygen environment to turn the kerogen into gas and oil. The other method is to heat the kerogen in place, applying heat and then pumping out the oil. While the in-place method requires less heat, both methods result in products with a higher per-barrel cost than conventionally produced oil.

Oil Trapped in the Rocks

In comparison to oil shale, shale oil is a reference to hydrocarbons trapped in non-porous formations. This means that the gas and oil cannot simply flow out into pipes as it would in a traditional oil well. Instead, the trapped oil is accessed via horizontal drilling and fracking that finally allows it to flow. This is the method used by most large producers, and it’s the one most investors envision when they hear the words “oil” and “shale.”

The Last Word

Whether discussing oil shale or shale oil, there’s a commonality: both have a higher per-barrel cost than conventionally extracted oil. Therefore, both are highly vulnerable to market forces. Oil shale is a potentially enormous source of oil, but it’s still difficult to get production costs low enough to remain competitive, especially at today’s rates.

On the other hand, shale oil has shown greater resistance to the current market climate, as some deposits are extractable and profitable at today’s market prices. In the end, the greatest difference between shale oil and oil shale is that shale oil is profitable now, while oil shale may be a money-maker in the future. Those who need more information can find it online.