Ivanhoe Energy Inc. President and CEO Joe Gasca and Chief Technology Officer Dr. Robert Graham today announced the successful demonstration of the third and final processing configuration to be tested at the company’s heavy oil upgrading (HTL™) Commercial Demonstration Facility (CDF) in California.

Completion of the successful test positions Ivanhoe Energy to proceed with the design and construction of full-scale, commercial HTL facilities.

The latest demonstration used a “Recycle” configuration, which is one of the operating modes that can be used to produce a “High Quality” upgraded product. High Quality modes typically would be applicable to bitumen production, wherein higher levels of upgrading and viscosity reduction, as well as significant byproduct energy, are required. Bitumen production in the Athabasca oilsands in Western Canada is expected to be the most significant market for this mode of HTL operation.

This is the third processing configuration to be successfully demonstrated at the CDF. Ivanhoe Energy has previously announced successful demonstrations of a High Yield mode, where liquid yields are maximized, as well as a “Once Through” High Quality configuration that, similar to the Recycle High Quality configuration, emphasizes product quality and on-site energy production. The three configurations may be used independently, or in various combinations, to match processing modes to feedstock characteristics and production goals.

The most recent run used California vacuum tower bottoms (VTBs), which have an API gravity of 5.6°. California VTBs are heavier than Athabasca bitumen, which typically has an API gravity of approximately 8°. The properties of the upgraded oil produced in the Recycle High Quality configuration will be released as appropriate along with additional test run data. The next test run, scheduled for this quarter, will process Athabasca bitumen that has been provided by a major international integrated oil company.

“This successful demonstration of the Recycle mode complements other HTL configurations previously demonstrated in our California CDF. Ivanhoe Energy now has the full suite of tools to progress to full-scale commercial facilities in a number of markets around the world, especially where fuller upgrading and higher levels of on-site energy is required. The Athabasca oilsands represents the primary market opportunity that requires the configuration announced today,” Joe Gasca said.

Dr. Robert Graham added, “This successful demonstration of the Recycle configuration fulfills the primary technical objectives that Ivanhoe Energy established for the CDF. This latest configuration provides us with significant flexibility to tailor our process to specific business opportunities. Future CDF operations will be deal-driven and will focus on the testing of heavy crudes in support of project development in Western Canada and around the world.”