Presentation on theme: "Oil Sands 101 ERG Victoria Jan 09 Roger Bailey. Alberta Tar Sands Big, Tough Expensive Job Not Economic Depends on government handouts Dirty Oil Pollutes."— Presentation transcript:
Alberta Tar Sands Big, Tough Expensive Job Not Economic Depends on government handouts Dirty Oil Pollutes the Environment –Air: SOx, Nox, CO 2, Climate –Water: consumption, toxic sludge –Land: Devastates Boreal forest Destroys society
Alberta Oil Sands World’s largest oil deposit 2,000,000,000,000 Established Reserves: 173,000,000 barrels Canada’s economic engine $70 billion invested, $70 billion planned Now 1.2 million BPD, 5 million BPD in 2030 Creates Jobs and Wealth Mining yesterday’s technology In-Situ SAGD is the future
What Changed? 1.Price of oil over $50 / bbl 2.“The end of cheap oil” 3.Government Policy. 4.Technology 5.Resources to Reserves
What Recently Changed? 1.Price of oil under $40 / bbl 2.Not “the end of cheap oil” 3.Government Policy 1.Royalties up (Syncrude + $2 billion) 2.Taxation: No accelerated CCA 3.CO2 Penalties 4.Technology: CO2 focus 5.Resources to Reserves? Economics
AOSTRA Alberta Oil Sands Technology and Research Authority Alberta invested $750 million in R&D Industry matched funding and did the work Enabling Technologies –Steam Assisted Gravity Drainage (SAGD) –Cold Water Extraction (OCWE) –Consolidated Tailings (CT)
Cold Lake – In Situ –SAGD Operator Project Initial Potential Shell Hilda Lake (pilot) 600 20,000 CNRL Primrose 50,000 110,000 Imperial Cold Lake (CSS) 150,000 110,000 Husky Tucker 18,000 40,000 Peace River – In Situ Shell Peace River 12,000 100,000
Underground Test Facility (UTF) Shaft & Tunnel Access SAGD Well Pairs Horizontal Injector And Producer
Steam Assisted Gravity Drainage Steam injected in upper horizontal well melts the bitumen Bitumen flows by gravity down to the lower producing well Steam chamber grows as bitumen is produced Recovery over 60%
SAGD Applicability Resources to Reserves 352 Billion @ 6% 239 Billion @ 10% EUB Reserves in 2000 173 Billion based on SAGD Steam Assisted Gravity Drainage
SADG needs steam. Steam Oil Ratio ~3 Steam is water and energy –Both are limited and expensive Little fresh water: saline and recycle Expensive water treatment required Energy? Gas, Co-generation? Gasification? Pitch? Nuclear?
SAGD CO2 Emissions Natural gas for steam ~1 GJ/barrel CO2 Emissions ~60 kg/bbl Cogeneration: –Gas turbine produces electricity –Exhaust + re-firing produces steam Cogen steam for SAGD with no CO2 CO2 in Cogen charged to electricity CO2 from Cogen less than coal
Nuclear Energy for Oil Sands? Nuclear for steam, electricity and hydrogen is possible but….
Oil Sands Projects Source: CERI Study CAPP Backgrounder 2008
Bitumen Upgrading Upgrading takes the black out of black oil, the tar (asphalt) Synthetic crude approximates crude oil for refineries SCO flows and distils to refinery fuel products Bitumen needs carbon out or hydrogen in Capital, energy and CO 2 intensive Refinery integration in US?
Oil Sands Challenges Environmental sustainability –CO2 costs –Natural gas limitations and costs Fiscal changes, lower returns Infrastructure limitations Workforce New Markets and Pipelines Upgrading? Moving to US refineries
Inflation: Capital Cost Source: CAPP Backgrounder 2008
Dirty Oil? Not the “End of Oil” nirvana Other oil options will be produced Oil Sands, Oil Shale, Carbonates Life Cycle Analysis: –85% of Emissions in use as fuel