Utah oil sands project nearing construction
US Oil Sands (CVE:USO) is pushing ahead with what will be the first and only bitumen extraction operation in the US.
The Calgary Herald reports the first equipment for the mine has been purchased for the PR Spring project in Utah.
Earlier in May, US Oil Sand's board approved PR Spring mine and processing facility targeting an initial 2,000 barrel per day at a construction cost of $60 million.
Operating costs per barrel is estimated at as little as $26 a barrel and the modular building process means easier expansion.
The Calgary-based company has a 100% interest in bitumen leases covering 32,000 acres of land in the Uintah basin, the largest on state land in the US.
US Oil Sands say their approach eliminates need for tailings ponds, requires 50% less energy input than traditional oil sands projects, recycles 95% of the water used and has small above ground footprint.
The company's pioneering process uses a citrus extract called d-Limonene as a solvent to separate bitumen from sand. d-Limonene oil from orange rind is used industrial cleansers.
The company raised $81 million in October last year and holds the only commercial bitumen extraction project permitted in the US.
Shares in the $106 million company are showing losses for 2014 – it is down 16% year to date, but the tightly-held counter is up nearly 20% on the Toronto venture market compared to this time last year.
Image from US Oil Sands Inc