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August 16, 2012

Unlocking more of Canada's Oilsands While Emitting Less Pollution and Using Less Water

1. Wall Street Journal - oil companies here are experimenting with technologies that could unlock even more reserves from what is some of the world's heaviest and stickiest petroleum. The new technologies could also drive down the cost of producing oil in Canada.

One consortium aims to get oil flowing to the surface by sending radio waves from huge antennae pushed through wells deep underground—adopting technology first developed for the U.S. government to eavesdrop on underground bunkers.

Another company is working on inserting electrical heating coils into wells to melt the oil, while other firms are tinkering with petroleum-based solvents they hope to pump into wells to get more oil out.





Laricina is one of several companies including Royal Dutch Shell, PLC, Athabasca Oil and Husky Energy that are adapting SAGD technology to rock formations like the Grosmont and trying out new enhancements to cut the use of fresh water and energy, which will bring down the overall cost and greenhouse gas emissions of operations there. While SAGD doesn't gobble up as much surface area as conventional oil-sands mining, it still uses lots of energy and water. That makes it expensive and carries a big greenhouse-gas footprint.

Laricina is part of a consortium including large Canadian energy companies Suncor Energy and Nexen that is testing replacing the steam with an antenna, developed by Melbourne, Fla., telecommunications-equipment manufacturer Harris Corp After being fed down a well, the antenna blasts out heat, warming the bitumen.

Mr. Schmidt said early tests show the technology could cut energy use by 40%. It also removes the high upfront costs of water treatment and steam generation facilities. That could cut the cost the cost of SAGD production, which is currently around $55 to $65 a barrel for most projects.

"If we eliminate steam, we eliminate potentially 60% of the cost of a facility, which is huge," he said. The technology could be ready as soon as 2019.

Athabasca Oil, another big Canadian oil producer, is testing a similar electric-heating technology to unlock bitumen from carbonate rock. The company inserts electric coils, made of the same material as heating elements on a stovetop, into wells. If tests are successful, Athabasca plans to start a commercial project for its technology by 2018.

Laricina and several other companies are also testing adding light hydrocarbon solvents to steam in SAGD wells to boost output. The solvent dilutes bitumen, making it easier to flow.

Cenovus Energy is working on a solvent project that could be rolled out commercially in 2017.

Jason Abbate, head of production engineering at one of Cenovus' projects, said solvent technology could increase oil production rates by up to 25% and cut the amount of steam and natural gas use by up to 30%. It could also improve the percentage of oil that producers can capture from bitumen deposits.

"If you can get 80% to 90% of that rather than the regular 70% with SAGD, there's a big economic benefit for us," Mr. Abbate said.


2. Edmonton Sun - Thanks to the power of new technology, Alberta’s hydro-carbon energy industry is cleaning up its act at a breath-taking pace and there is new methods that could increase usable oilsand from 10% to 25% of oil in place. This would increase available oil from 170 billion barrels to over 400 billion barrels.
* Thanks to new technology, the bitumen (heavy oil) produced at Imperial Oil’s soon-to-open Kearl Lake oilsands mine will be so clean as to not need upgrading. The environmental consequences are monumental. One less processing operation will dramatically reduce CO2 emissions. Simply put, any new oilsand mining operation from now on won’t need upgraders.

* Tailings ponds — those huge man-made lakes of crud around oilsand mining operations — will soon be of the past. Suncor’s new technology can clean that water in a few weeks, not the current 20 years. Imperial has laboratory evidence that water can be eliminated from its bitumen-sand separation process, hence no need for tailings ponds, period. Other possibilities are tumbling out of tailings-ponds research collaboration.

* The “steam” in steam-assisted gravity drainage (SAG-D) oilsand operations may soon be gone. New research points to recyclable solvents or natural gas derivatives replacing the super-hot steam. No steam, no water use. No steam, no heating. No heating, no CO2 emissions.

* The oilsands world awaits the final verdict on Petrobank’s revolutionary THAI Toe-to-Heel-Air-Injection underground bitumen recovery — using underground fires to melt bitumen that can then be pumped to the surface. No water, no CO2 emissions, but will it work on a grand scale?

* The end of diluents: To make molasses-thick bitumen flow down pipelines, “diluent” (in effect light oil) has to be added, causing additional cost and additional pipelines. New technologies are finding ways to make bitumen more “flowable” without additives. The less the additives, the less the environmental impact.

* Carbon capture: Shell’s huge Quest carbon capture project at its Scotford refining complex northeast of Edmonton will be operational by 2015. The prototype is heavily subsidized, but don’t forget Shell is putting $450 million of its own skin into this game. The huge environmental upside will come when carbon-capture and other technologies create “clean-burning” coal.


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