Carbon pipeline input sought
By Advocate staff

Published: March 17, 2010 7:51 PM

The Energy Resources Conservation Board is seeking input from interested parties with respect to a proposed pipeline system that would carry carbon dioxide from industrial emitters near Edmonton to mature oilfields in east-Central Alberta.

Enhance Energy Inc. wants to develop the 240-km pipeline, with the province pledging $495 million for the project and the federal government agreeing to kick in another $63.3 million. The Alberta Carbon Trunk Line would transport carbon dioxide from the Fort Saskatchewan area to a site near Clive. From there, it would be distributed for injection into conventional oil and gas reservoirs to stimulate production.

Enhance Energy’s application calls for the line to be built in two segments, with one measuring 21.4 km and the other 215.5 km.

Enhance Energy’s CEO Susan Cole said previously that work would begin next year, with the pipeline expected to be operational by late 2012. Labour during construction would peak at around 2,000 direct jobs, but workers would also be needed for ongoing operations and the resulting enhanced oil recovery projects.

The line’s capacity is expected to be 40,000 tonnes of CO2 per day, or more than 14 million tonnes a year. That’s equivalent to the CO2 produced by 2.6 million cars.

However, initial volumes are expected to be about 5,100 tonnes per day.

The gas will not contain hydrogen sulphide.

A copy of Enhance Energy’s application can be obtained from the company in Calgary. It is also available for viewing through the ERCB.

Submissions related to the application must be received by the ERCB by April

..Drawing on CO2 from petrochemical manufacturing at Joffre (near Red Deer, Alta.), Penn West operates Alberta's only CO2-driven EOR project. Encouraged by that five-year pilot project, the trust is working toward construction of a CO2 pipeline that would transport that gas about 150 kilometres for EOR use in the Pembina field. In the meantime, it has drilled two innovative horizontal wells in the Pembina Cardium. The first was a water injector, designed to drive oil toward vertical wellbores, while the second well initiated a CO2 flood. Results have not been announced......

http://www.oilandgasinquirer.com/article.asp?article=magazine/090706/MAG2009_L60000.html

Large-scale carbon storage possible in Alberta - at a cost, researchers say


By Dan Healing, Calgary HeraldMarch 12, 2010 12:02 PM

CALGARY - “Huge amounts” of carbon dioxide can be stored underground in Alberta, says a University of Calgary-led study released Friday, although it adds cost is a concern and more study needs to be done.

The study, paid for by two councils backed by the provincial and federal governments and industry, concludes it is “technologically feasible” to store 500 million tonnes of CO2 in a 5,000-square-kilometre area without managing the pressure of the geologic formation into which it is would be injected.

But the team of 16 university researchers and industry consultants started out with the prospect of one billion tonnes — 20 million tonnes per year of carbon dioxide over 50 years — in a study of the feasibility, cost and potential risk of permanent underground storage.

The 500 million tonnes is roughly equivalent to half the emissions for 30 years from all of Alberta’s centrally located coal-fired power plants, the report notes.

The study, called the Wabamun Area CO2 Sequestration Project or WASP, was coordinated by the Institute for Sustainable Energy, Environment and Economy at the university.

The Alberta government has committed $2 billion to help kick-start four commercial-scale CCS projects as a key way of reducing greenhouse gas emissions, especially from coal-fired power plants.

dhealing@theherald.canwest.com

CNRL joins upgrader project

50/50 partnership 'a real step forward,' North West says

By Dave Cooper, Edmonton JournalJanuary 29, 2010 3:04 AM


A proposed Redwater-area upgrader got a shot in the arm Thursday by attracting a heavy-hitting partner to supply some of the needed bitumen feedstock, and financial and technical support.

North West Upgrading, which has already spent about $300 million -- including $100 million for major equipment sitting in storage -- will be joined by Canadian Natural Resources Ltd. on the $4-billion project that could be operating by 2013.

North West will remain as the project operator, and the 50/50 joint venture is anticipated to close later this year.

North West was one of several bidders for Alberta's bitumen royalty in kind (BRIK) program, which initially will sell 75,000 barrels per day to firms that agree to "add value" or upgrade the raw product. Submissions closed late Wednesday.

North West is applying for 37,500 bpd for its first phase, with an additional 12,500 bpd coming from CNRL. When diluent is added to that raw bitumen, the feedstock will equal 77,000 bpd, and because of its efficiencies, the output will also be 77,000 bpd.

Imperial is also bidding under BRIK, as are several other firms that have not been identified.

"We do no not normally release the names of proponents, but they can themselves if they wish," said Alberta Energy spokesman Bob McManus.

All the proposals will be studied, and a decision is not expected before the end of May, he said.

Ian MacGregor, North West's chairman, said CNRL's vote of confidence is very encouraging.

"This is great for us and a real step forward. And it really helps us because they have recent construction experience (at the Horizon oilsands mine and upgrader project)."

The North West project will be the world's first upgrader with an integrated carbon-dioxide recovery system hooked into Enhance Energy's Alberta Carbon Trunk Line, which intends to supply CO2 for enhanced oil recovery in central Alberta.

"For us, this project makes a lot of sense. But of course, we haven't seen what other projects have been proposed," said Neil Shelly, executive director of Alberta's Industrial Heartland, a four-member municipal group that will welcome Edmonton as its newest member today.

"The North West project is like an upgrader on steroids, a mini-refinery that takes bitumen and converts it to diesel and pumps the CO2 into the Enhance pipeline, so it is a green product," he said. And this is becoming increasingly critical for Alberta oilsands producers, he added.

"California's low-carbon-intensity fuel standards would disadvantage oil from the oilsands. California is not our traditional market, but 11 other states may follow California," Shelly said.

In Canada, B.C., Ontario and Quebec have said they are unhappy with Ottawa's stand on greenhouse gases.

So facilities like North West could be a look at the future, Shelly said.

"In California, they will ramp up over the next decade to E-10, or 10 per cent ethanol, which means fuel must have the equivalent carbon footprint of that mixture."

The diesel fuel to be produced by North West will meet or exceed that standard.

"So for Alberta, carbon capture and storage is becoming more and more about market access for our products."

Alberta's BRIK program collects upwards of 25 per cent of a project's production once capital costs are paid. As prices escalate, so does the royalty, up to 40 per cent at $120 or higher.

The province doesn't collect a percentage of production, but rather bitumen or product from bitumen equal to between 25 and 40 per cent of net profits once capital costs are paid out.

Myths of carbon capture 'challenge' Alberta expert

Technique best suited to power plants and industry, not oilsands, says Stefan Bachu

By Dave Cooper, Edmonton Journal
January 2, 2010

For one of the world's leading experts on the geological storage of carbon dioxide, there seems to be more demanding work to do on the surface of the Earth than deep underground.

"My biggest challenge is to convince the public, politicians and green NGOs (non-governmental organizations) that carbon capture and storage (CCS) is not a ploy by the oil industry -- seen as the villains -- to extend the life of fossil fuels," said Stefan Bachu, honoured recently by the Alberta Research Council as a "Distinguished Scientist," its top award.

Bachu's expertise in CCS, his work over the decades, his record of successful projects and his list of national and international collaborations convinced the council to make the rare award, only the fifth in its 88-year history.

His work has helped position CO2 storage as a key way to deliver substantial greenhouse gas emission reductions. And in 2007, he was one of the winners of the Nobel Peace Prize as a lead author to the Intergovernmental Panel on Climate Change special report on CO2 capture and storage.

Colleagues are generous in their praise of Bachu, a hydro-geologist/ engineer.

"If I need to get a straight answer about a complicated or important issue relating to (geological storage), Stefan is one of three people in the world I call," said Howard Herzog, senior research engineer at the Massachusetts Institute of Technology Energy Initiative.

Brent Lakeman, the research council's business unit manager for carbon and energy management, said the award is "for true leaders who are directing a research team of size and significance."

One of the past winners was Bill Gunter, a now-retired geochemist who also played a major role in the council's leading-edge work on CO2 storage.

"With Stefan and Bill, it is like Lennon and McCartney. The ARC is renowned for its work in this area," Lakeman said.

Perhaps the best-known project locally is the HARP (Heartland Area Redwater Project), which aims to understand the storage potential in the Redwater reef structure.

An oil and gas firm, ARC Resources, produces oil from one area of the reef and will soon drill an exploratory well into a non-oil-bearing zone to study its suitability for carbon dioxide storage.

The firm and council have worked closely, as Bachu is also research manager for HARP.

"He brings a wealth of experience and insight to the storage component of CCS, which has been very helpful to us," said Bill Sawchuk, manager of enhanced oil recovery reservoir engineering for ARC Resources.

Sawchuk said while the capture and transport of CO2 can now be considered almost routine, considerable research remains to be done on the storage component of CCS.

In an interview, Bachu said more "money and people" are needed to better understand geological storage.

"Not too many politicians and others understand that even if they make these decisions on carbon capture, they won't have the capacity to deliver" without more research, he said.

"CCS is part of the global solution to CO2 emissions, and not the only one. But without it we will not attain the targets."

Bachu said CCS is best targeted at coal-fired power generation plants.

"The (global) focus on Canada and the oilsands is totally misplaced."

Every week China adds about 10,000 megawatts of coal-fired power-generating capacity, almost as much as Alberta's total electrical power-generating capacity.

"CCS is about CO2 from coal-fired plants and large industrial operations like cement and steel plants, not about the oilsands."

Alberta is one of the few areas in the world with excellent geological formations for storing CO2, which is why CCS is so important here, he said.

"This is a big challenge for China because they may or may not have the geological capacity. There is plenty of capacity east of the Rockies and the Andes, and the North Sea. Australia has good capacity, but not where the resources are, and there is almost nothing in Japan and Korea."

Which brings Bachu to his second big challenge -- getting some large-scale CCS demonstration projects off the ground in the next few years.

"We need large-scale injection of CO2 between 2020 and 2050, cradle to grave for CO2, and places to put it safely."

Bachu predicts a major public education effort will be needed in some countries.

"Besides the North Sea, there are places on land in Europe to put it, but some people don't want it even if it is three miles down, so it is no longer NIMBY (not in my backyard) but not even under my backyard.

"They simply don't understand that CCS is safe (held under enormous pressure in porous rock, much like natural gas). Even well-educated people I met in Europe believe there will be huge lakes and rivers of CO2 flowing underground which will burst through the surface," he said.

"Perhaps public perception is the biggest challenge of all."

Is this our Great Green Hope?


By Carrie Tait in Weyburn, Sask., Financial Post
December 5, 2009


Jean Borlée is standing in a prairie field dotted with pumpjacks, round bales of hay, cattle and cow pies because his company, Luxembourg’s steel giant ArcelorMittal, needs help.

He has made the long voyage from his home in Liège, Belgium, to this tiny southeastern Saskatchewan community as part of a trip requested by the French government, in the hope of learning more about a new, but unperfected, technology in the fight against global warning called carbon capture and storage (CCS).

Weyburn, after all, is home to the largest CCS facility in the world.

“My company is launching a project for CO2,” he said, looking up at a nodding black-and-orange Lufkin pumpjack owned by Cenovus Energy Inc., the operator of the nine-year-old CCS operation. “We have few contacts, so we have to make contacts ... These people have been storing CO2 for [nine] years, so that’s the best practical experience worldwide.”

Global carbon-dioxide emissions topped 27 billion tonnes in 2003, a 19% increase over 1990, according to the World Bank. Companies such as ArcelorMittal, which must use coal — a key culprit of carbon-dioxide emissions — to produce steel, are racing to lower their emissions as jurisdictions impose financial penalties for polluting.

Indeed, the European Union is ahead of North America in that regard, but it is widely believed companies on this continent will eventually face financial consequences as well.

“We want to take leadership in this domain, too,” Mr. Borlée said. “We know we have to do it.”

Resource-industry officials, scientists and politicians from around the world have flocked to Weyburn because CCS — a process by which carbon dioxide, the byproduct of fossil-fuel development, is pumped underground and trapped in saline aquifers or rock formations once inhabited by oil and gas before industry pumped them clean — has been elevated to the top of the list when it comes to climate-change solutions.

Alberta, home to much of Canada’s oil-and-gas industry, has led the way, committing $1.956-billion of its $2-billion climate-change fund to four CCS projects since October. Ottawa has pitched in as well, but not to the same extent.

“CCS is at the core of our efforts to meet our goals under Alberta’s climate change strategy,” Ed Stelmach, the Premier of Alberta, said last week as he pledged $495-million over 15 years to a new CCS project. The province is committed to reducing projected emissions by 200 megatonnes by 2050, with 70% of the reductions coming from CCS projects.

But with the United Nations Climate Change Conference in Copenhagen set to begin on Monday, critics say politicians may be putting too much hope in a system that is still a tangled mess of challenges. The problems range from technical to social, from capacity concerns to transportation logistics. Then there is the financial costs of capturing CO2 versus the financial penalties that may arise from ignoring it.

“Everyone is very much aware that there are a lot of doubts regarding this technology and that will make it very difficult to agree on binding commitments for this technology [at Copenhagen],” said Heleen Groenenberg, a senior researcher at Energy Research Centre of the Netherlands, which advises the Dutch government. “It will be difficult, but not impossible,” she then added.

The lengthy list of challenges explains why Mr. Borlée ended up in southern Saskatchewan on a sunny November day. He, along with 53 other French and Canadian academics, government advisors and industry players, spent two days in a conference room at the Hotel Saskatchewan in downtown Regina sifting through the science behind CCS before heading to Weyburn, 100 kilometres away. The session, called the First France-Canada Carbon Capture and Storage Workshop, was organized by Saskatchewan’s Petroleum Technology Research Centre, the French Embassy in Canada, and France’s IFP, formerly the Institut Français du Pétrole.

For the most part, companies, even governments, are forging ahead with CCS projects more out of self-interest than righteous concern for the environment. At his recent CCS funding announcement in Alberta, Mr. Stelmach said the technology will not only address climate change, but increase the efficiency of oil recovery.

“It is good news for the economy. Every barrel of oil recovered using CCS means more revenues for Alberta,” he said.

And the reason why ArcelorMittal is in Saskatchewan fine-tuning blueprints is because of carbon-tax legislation.

The Weyburn project, while hailed for its pioneering green ways, exists only because capturing carbon dioxide is a lucky byproduct of Cenovus’s efforts to squeeze more oil out of the ground. The company, which was spun off last month by Calgary-based Encana Inc., pumps CO2 underground to create pressure to push up viscous oil that is otherwise out of its grasp. Cenovus pipes its CO2 332 kilometres to Weyburn from a coal-gasification plant in Beulah, N.D.

Back at Weyburn, the French and Canadian group looked more like tourists than scientists. They arrived on a chartered bus, gawked at the mechanical bobs of the pumpjacks in farmers’ fields, giggled at the cow patties and took pictures of the yellow pipes that poked out of the ground at injection satellites.

The real magic at Weyburn is found in unobtrusive fibreglass huts. Allan Greeves, the head of Cenovus’s Weyburn operation and the tour guide, opened a door on one of these shelters so the scientists could view the monitoring equipment and the cluster of yellow, stainless-steel pipes that sprout up a few feet from the ground and emit a hissing sound — all that’s needed to inject the CO2 into the ground. The machinery in one hut pushes enough CO2 underground to service up to nine oil wells.

To these scientists, who flew 6,993 kilometres from Paris to Regina, and then travelled on to Weyburn, it is an awesome sight.

“It is even more interesting than I expected,” said Maurice Bouteca, the director of the exploration-production technology business unit at IFP, after peering inside the hut. “What is important, especially in the CO2 area, is showing — making people understand, seeing how it works — that it can work. That’s what is important.”

Therein lies one of the biggest challenges facing CCS. Public acceptance was a major theme at the Regina conference and on the Weyburn tour. Not-in-my-backyard protests in Europe over CCS projects have been increasingly vocal, although in Canada there has been relatively little objection. Safety concerns, such as the potential for leaks, top the list.

Royal Dutch Shell PLC, for example, is working on a project in the Netherlands, near Barendrecht, and has faced “massive protests,” said Ms. Groenenberg in a telephone interview. Local decision makers quashed the project, but the national government overruled them. The local politicians, she said, may turn to the courts to block Shell’s project.

Jean-Claude van Duysen, from Electricité de France, the Paris-based utility giant, best summed up the concerns voiced at the Regina conference. “You could have the best technology in the world, but if the public doesn’t want it, it is useless.”

Even if governments and industries can prove the process is safe, not all the Earth’s layers are as welcoming to CO2 as those in Alberta and Saskatchewan. There are only so many caverns where CO2 can be stored, another factor limiting CCS.

Cenovus’s Weyburn operation has buried about 15 million tonnes of carbon dioxide so far, with the potential to hide up to 30 million tonnes as part of its oil production, and room for an extra 25 million tonnes on top of that — a small dent in a massive problem.

Moreover, experts such as Hugo DeLasa, director of the University of Western Ontario’s Chemical Reactor Engineering Centre, say that it is the cost of capturing — not storing — CO2 that is one of biggest obstacles facing CCS.

In a power station, for example, fuels such as methane or coal are burned with oxygen in the air, forming a mix of CO2 and nitrogen, Mr. De Lasa explained. Nitrogen makes up about 80% of the mix, with CO2 accounting for the rest. In other words, for every four molecules of nitrogen, there is just one molecule of CO2. That makes a storage headache.

“The issue is you can’t put all that CO2 highly diluted in nitrogen underground,” Mr. DeLasa said. “The nitrogen has to be separated prior to burying the carbon dioxide. This is the challenge. If you analyze the cost of CO2 capture, it is 70% separation costs.”

Existing methods of separating CO2 and nitrogen, he said, are extremely expensive. “We have to solve this problem of CO2 and nitrogen separation. This is an issue of great importance for Canada.”

Christine Schuh, the head of PricewaterhouseCooper’s Canadian climate-change team, argues the thicket of unanswered policy questions could further stymie CCS advancements.

Should companies capture CO2 for the sake of it? Legislators have yet to sort out who would be awarded environmental red ribbons for their efforts.

Upping the ante even more is that CO2 itself is morphing into a commodity. So, does a coal facility that captures CO2 and pipes it to a dried-up oilfield for sequestration earn a carbon credit? Or should the oil company that stores it be rewarded? When CO2 is shipped across borders, as is the case with Cenovus’s Weyburn project, should the United States’ net carbon-dioxide emissions tally go down and Canada’s climb? Or does Canada’s stay neutral because the substance never made it into the atmosphere?

In the end, while CCS makes carbon dioxide go away, at least temporarily, it does not change human behaviour.

“One of the problems is it is a relatively short-term solution,” Ms. Schuh said of CCS. “It doesn’t enhance our chances of moving to a less carbon-intensive economy.”

Big Oil makes case for carbon-capture subsidies
Shawn McCarthy

OTTAWA — From Monday's Globe and Mail Published on Monday, Nov. 09, 2009 6:00AM EST Last updated on Monday, Nov. 09, 2009 7:22AM EST

Canada's oil sands companies say they must adopt expensive carbon-capture-and-storage technology to meet environmental challenges, but will require major government subsidies to do so for at least the next decade.

While carbon-capture-and-storage (CCS) will be expensive, the industry defends it as being competitive with wind power and biofuels in terms of the cost per tonne for reducing greenhouse gas emissions.

"CCS is vital to the sustainability of Canada's oil sands development and the continued production and use of Canada's fossil fuel resources," says the report from the Integrated CO{-2} Network (ICO{-2}N), an industry group that represents Canada's major oil companies and coal-based utilities.

"It makes environmental and economic sense to develop initial CCS projects within a vision of a long-term, large-scale integrated system."

While the major oil companies all endorse the need for CCS, they do not agree on the best way to impose the price on carbon emissions that will be required to commercialize the technology.

Imperial Oil Ltd.'s parent company, Exxon Mobil Corp., argues in the United States for a direct tax on carbon emissions, while Royal Dutch Shell PLC and ConocoPhillips Co. support a cap-and-trade system. As a result, the industry's main lobby group, the Canadian Association of Petroleum Producers, has been unable to forge a consensus on how Ottawa should proceed.

Both the U.S. and Canadian governments are developing plans to impose cap-and-trade regimes under which companies would have to pay a price per tonne for permits to emit greenhouse gases, and a limited number of permits would be available.

The ICO{-2}N report suggests that, whatever the mechanism, the oil industry and coal-fired utilities inevitably face requirements to significantly reduce greenhouse gas emissions, and CCS needs to be a part of the response.

However, the cost of CO{-2} capture at oil sands extraction sites would be far higher - perhaps prohibitively so - than at power plants, chemical facilities and oil sands upgraders, which refine raw bitumen into synthetic crude oil.

Even for the less expensive options such as chemical and fertilizer plants, wide-scale deployment would require carbon emission prices considerably higher than the levels that industry and government have suggested as reasonable for meeting greenhouse gas emissions targets.

The adoption of CCS would cost $85 to $120 a tonne at existing chemical and fertilizer plants and some new coal-fired power plants, rising to $120 to $160 per tonne for refineries and upgraders. But capturing CO{-2} emissions from the natural gas-fired boilers that create steam for oil sands extraction would top $160 a tonne.

In a companion report released by ICO{-2}N today, Ottawa-based consulting firm Delphi Group compared costs of competing emission-reduction technologies. Delphi calculated that, in terms of displacing carbon emission from fossil fuels, both wind power and ethanol cost well above $150 a tonne, and both receive generous government support.

The oil companies and utilities are awaiting federal government climate change regulations that will force them to reduce their emissions and essentially set a price on carbon.

In the initial years at least, the carbon price is expected to be far below what is needed to justify investments in CCS by oil sands producers and utilities. In a now-discarded regulatory plan released in 2007, the Harper government estimated that carbon prices would rise to $65 a tonne by 2020.

To close that cost gap, the industry is suggesting governments must directly support the early adoption of CCS beyond what has been committed. Ottawa and Alberta have already announced $1.4-billion in funding for CCS pilot projects involving a coal-fired power plant and an oil sands upgrader, which together would reduce emissions by one million tonnes. The federal share amounted to $463-million.

The industry group does not put a price tag on its call for subsidies, saying the cost will depend on what carbon price Ottawa imposes, and actual cost of capturing emissions, and number of projects supported.

Environment Minister Jim Prentice has repeatedly delayed the release of his plan, saying he wants to see what regulations are adopted in the United States to ensure Canada's approach is compatible with our major trading partner.

With an aggressive program, the report says the technology could reduce emissions by as much as 35 megatonnes per year by 2020, roughly a quarter of the reductions necessary to meet Ottawa's target of a 20-per-cent reduction from 2006 emission levels. By 2025 to 2030, CCS could reduce emissions by 50 megatonnes per year.

$779M allocated for Alberta carbon capture project

EDMONTON - The Alberta and federal governments said Wednesday they plan to spend $779 million over 15 years to help TransAlta Corporation kick-start its carbon dioxide capture project for its still-under construction Keephills 3 coal-fired electricity generation plant near Wabamun Lake west of Edmonton.

Called Project Pioneer, it will capture and store up to one million tonnes of CO2 per year.

Last week, the two governments laid down their first big bet in the fight to limit CO2 by promising Shell Energy a total of $865 million for its Quest project near Fort Saskatchewan.

“Perfecting technology to reduce greenhouse gas emissions from coal-fired electricity generation will not only have a significant impact in Alberta, but it could help throughout North America and in developing nations like China,” Premier Ed Stelmach said Wednesday.

“This project provides an opportunity for Alberta to be a leader in developing game-changing carbon capture technology that could be used around the globe.”

The Pioneer Project will utilize leading-edge technology to capture CO2.

The CO2 will be used for enhanced oil recovery in nearby conventional fields, or stored almost three kilometres underground. Alberta’s investment, through its $2-billion Carbon Capture and Storage (CCS) Fund, will total $431 million over the next 15 years. An additional $5 million will be provided to the project to support front end engineering and design. The private partners are TransAlta, Capital Power and Alstom.

The federal government is also contributing $343 million toward this project through the Clean Energy Fund and the federal ecoENERGY Technology Initiative.

Keephills 3 is a critical coal-fired plant jointly owned by Capital Power and TransAlta.

The two firms also share the identical Genesee 3 plant which opened several years ago.

“Carbon capture and storage provides Alberta and Canada a global leadership opportunity to develop new technologies to reduce CO2 emissions,” said Steve Snyder, president and CEO of TransAlta.

“Government and industry partnerships such as this are a critical catalyst required to accelerate implementation of these new technologies that will make Canada a global leader in CO2 reductions through CCS.”

With this announcement and signing of a Letter of Intent, Alberta’s committed funding toward commercial-scale greenhouse gas reductions is almost $1.2 billion leading to emission cuts of about 2.2-million tonnes per year.

The Alberta government is continuing to pursue Letters of Intent with project proponents for the remaining available funding.

Ottawa, Alberta to spend $850-million on carbon capture project
Edmonton.


The Alberta and federal governments have announced more than $850-million in funding for a carbon capture and storage project near Edmonton.

The money will be spent over 15 years at the Shell Quest project, jointly owned by Shell Canada, Chevron Canada and Marathon Oil Sands.

The money will pay for the development of technology that could eventually capture more than one megatonne of carbon dioxide from Shell's Scotford upgrader.

Alberta has pledged to spend $2-billion on carbon capture and storage projects, so more than half the money has yet to be allocated.

Carbon capture and storage is seen by some as the best way to reduce industrial emissions.

But critics say it won't be enough on its own for Canada to meet its emission reduction goals.

Home power bills may triple

Alberta green plan to cost up to $24B over eight years; Carbon capture and storage

By Renata D'aliesio, Calgary HeraldJuly 25, 2009 7:30 AM


Technology touted to capture carbon emissions and store them underground will require Alberta and Ottawa to kick in as much as $3 billion a year, while consumers' electricity bills may triple, says the head of a provincial blue-ribbon council.

On Friday, Alberta Energy released the panel's final report on carbon capture, which stresses billions more public dollars are needed before the technology can pay for itself.

Council chairman Jim Carter, former president of oilsands giant Syncrude, said a concerted effort by government, industry and consumers is needed to ensure carbon capture and storage technology succeeds and reduces the energy sector's greenhouse gas emissions. - What it is: The process involves capturing carbon emissions from industrial sites, such as coal-fired power plants, and storing them deep underground in geological formations to prevent emissions from entering the atmosphere and contributing to climate change; - Cost: A government-appointed council estimates alberta and ottawa will have to commit an additional $1 billion to $3 billion annually for up to eight years to expand ccs; - Time for research: The council expects it will take 15 to 20 years to achieve commercial-scale ccs at reasonable costs; - Consumer impact: CCS may double or triple the cost of electricity, heating and gasoline for consumers; - Government impact: Alberta may gain between $11 billion and $25 billion in royalties and taxes if captured carbon is injected into oil reservoirs to produce oil currently inaccessible through conventional methods.

Compiled by Renata D'Aliesio source: acceleraTing carBon

As part of its effort to fight climate change, Alberta has already committed $2 billion to getting three large CCS projects off the ground. The federal government has pledged $650 million toward advancing the expensive technology, which critics contend is unproven.

Carter said the expert panel --which included industry, government and academic representatives--estimates an additional$1 billion to$3 billion annually will be needed from the province and Ottawa for five to eight years, potentially costing as much as $24 billion.

But the report states consumers will ultimately bear the financial brunt of tapping CCS to keep carbon emissions produced by the oilpatch and coal-fired power plants from entering the atmosphere.

"I'm not sure the public really is aware of the magnitude of the impact of some of these (climate change) measures," Carter said, adding electricity bills could double or triple.

"It's going to have an impact, whether it be the price(of gasoline) at the pumps eventually, or whether it be electricity or home heating."

The council's report, which provides the province with a road map for expanding CCS projects, prompted the NDP and Wildrose Alliance to call on the Stelmach government to withdraw its $2 billion in funding.

Wildrose Alliance Leader Paul Hinman said the government is wasting taxpayer dollars on an unproven technology to combat what he contends is a scientifically unproven problem -- that man-made carbon emissions are accelerating climate change.

"Consumers won't have to pay a little. We'll have to pay the whole shot," he said. "This is going to affect the working man and those people that are struggling to get by."

NDP Leader Brian Mason doesn't question the science behind climate change, but thinks giving public dollars to the energy industry is a "boondoggle."

Instead, he wants the Alberta government to pour the money into renewable energy, including wind and solar.

"Hold onto your wallet," Mason implored. "The size of the sums involved here are staggering."

But Energy Minister Mel Knight said the province is committed to aiding the development of CCS, likening its significance to the technological breakthroughs that unlocked the oilsands.

Knight acknowledged finding the government cash will be a challenge, as Alberta and Ottawa are on track to post record deficits.

"We know that the (financial) gap exists and we'll find ways as we move forward to close the gap," he said.

Part of the problem, Carter noted, is carbon's current value is too low and greenhouse gas regulations haven't taken hold globally.

In Alberta, companies pay a $15-per-tonne levy if they exceeded emission limits or they can buy credits on the market, which generally sell for about $7 a tonne.

Carter figures the price of carbon will have to rise to $50 or $60 per tonne to make CCS development viable on a commercial scale.

One potential CCS benefit for industry and government is enhancing oil recovery, injecting carbon emissions into reservoirs to stimulate oil production.

The report estimates this could yield an extra 1.4 billion barrels of oil, while delivering between$11 billion and$25 billion in additional royalties and taxes to governments.

Marlo Raynolds, executive director of the Pembina Institute, an environmental think-tank, supports developing CCS technology, but cautioned governments shouldn't provide additional money until Alberta's three approved carbon capture projects--years away from completion--demonstrate results.

He added that carbon capture is just one piece of the puzzle. He said the province and Ottawa need to beef up their support for renewable energy and energy efficiency.

Eric Beynon, a director with Integrated CO2 Network, which represents 18 companies interested in CCS, said overcoming the technology's high cost is the most significant barrier to its widespread deployment.

"CCS is not currently economical. But when you look down the road 15, 20 years and you sort of see the picture's end, it does play a big part of Canada's energy future."

Jim Wachowich of the Consumers' Coalition of Alberta wants to see a breakdown of the cost for consumers.

"It's nice that this report says, 'Look, consumers, get ready, you're going to pay more.'But we should arm consumers with the knowledge of how much more so they can make those choices."
© Copyright (c) The Calgary Herald

Gov't plan will 'double' cost of electricity

Carbon capture also demands billions of taxpayer dollars: premier's advisory council

By Hanneke Brooymans, Edmonton JournalJuly 25, 2009 7:32 AM


Carbon capture and storage will "at least double" electricity prices in Alberta and require taxpayers to contribute up to$3 billion more a year to support industry's efforts to use the technology, says the chairman of a provincial advisory council.

"The whole slate of new electricity that has got a lower carbon footprint is going to be more expensive than we've experienced

up until now," Jim Carter, of the Alberta Carbon Capture and Storage Development Council, said Friday. That would include nuclear power and other alternatives, he said.

Premier Ed Stelmach appointed the council last year. Its report, submitted to the province in March, was released Friday.

Carter, a former president of the oilsands giant Syncrude, said captured carbon dioxide could be pumped into older oilfields, producing more oil and generating $105 billion in revenue, with $11 billion to $25 billion going to the province in royalties.

This calculation assumes oil is $75 US per barrel and an enhanced capacity to potentially store 450 million tonnes of carbon dioxide.

To make this happen, Carter said industry will need $1 billion to $3 billion annually in federal and provincial money for seven to 10 years, beginning in 2015.

That's when the three projects chosen last month for the province's current $2-billion carbon capture and storage fund come on line. Those projects will capture about four million tonnes of carbon dioxide annually by 2015.

The move is designed to reduce greenhouse gas emissions while at the same time taking heat off the Alberta government from environmentalists and other critics.

Carter said once the industry gets more experience with the technology, costs could be significantly cut.

When North American industries were told to cut sulphur dioxide emissions to tackle the problem of acid rain, the initial capital cost was double what it is now, he said.

Alberta NDP Leader Brian Mason said polluters should pay for the technology, not taxpayers.

"If this government is considering billion-dollar investments to combat climate change, they should fund renewable projects like solar or wind," he added.

Alberta Energy is still reviewing the report.

"Right now, we don't know the true cost of CCS projects," said department spokeswoman Karen Karbashewski. "The $2 billion with the three projects will give us a great sense of the true costs and we expect the costs to come down."

Further funding could come from a variety of different sources, such as Ottawa or a carbon tax, greenhouse gas compliance payments or carbon dioxide credits, she added.

The Pembina Institute, an Alberta-based energy and environment think-tank, said renewable energy sources should be given an opportunity, too.

"We really have not provided any stimulus or incentive for that to really occur," said executive director Marlo Raynolds.

"So before spending additional billions of dollars on carbon capture and sequestration, I'd want to first give the potential for renewable energy given an opportunity, and two, see what emerges out of our first $2 billion of investment."

Raynolds also has some concerns about producing more oil by pumping carbon dioxide underground, because, ultimately, that oil, too, will be burned and produce more carbon dioxide.

But the overall impact of that depends on whether or not that enhanced oil recovery would take place anyway, without the carbon dioxide. And currently, some of it is done using fresh water. In that case, using carbon dioxide would be a better option, he said.

Carbon capture could generate billions in royalties for Alberta

NATHAN VANDERKLIPPE

CALGARY — From Saturday's Globe and Mail Last updated on Saturday, Jul. 25, 2009 04:17AM EDT

Technology to capture Alberta's greenhouse gases from the oil sands could not only reduce the industry's carbon footprint, but also generate billions in additional royalties every year, according to a new study.

The independent report drafted for the government sheds new light on the huge effort - and cost - needed to dramatically reduce emissions in a province that generates most of its electricity from coal, and produces most of its crude from oil sands. But it also outlines the potential benefits.

It will likely take a joint federal-provincial commitment of $1-billion to $3-billion a year for a decade to make the technology work on a commercial level in Alberta, according to the Alberta Carbon Capture and Storage Development Council.

That prospect drew criticism from the provincial NDP, which called it a "boondoggle" that could trigger "staggering tax hikes."

The council, chaired by former Syncrude president Jim Carter, found that the cost of extracting carbon out of some exhaust streams - in particular, those at in situ oil sands operations that use steam to extract bitumen - could reach over $250 a tonne. That's equivalent to $11 a barrel, a massive additional cost that government would have to help shoulder.

But if Alberta invests the money into cheaper carbon-capture alternatives, such as coal-fired power plants and, later, the upgraders that transform bitumen into a refinery-ready light crude, the province could actually find itself with a new oil bonanza on its hands, the report finds.

The reason: All of that captured gas could be pumped into exhausted old oil wells, and help bring them back to life.

It's a process called "enhanced oil recovery," and the report calculates that at oil prices of $75, such projects could increase the province's reserves of conventional - or non-oil sands - crude by about 50 per cent. That would generate an impressive $11- to $25-billion in extra taxes and royalties for the province - enough to potentially pay off the government's carbon capture investment.

If oil prices rise to $125 a barrel, the government take from new production could rise as high as $81-billion.

"I like to categorize it as similar to oil sands development, and even the offshore Hibernia project," said Mr. Carter, the council chairman. "We wouldn't have had those if we hadn't had government and private enterprise working together. And today all of those things are significant vehicles for the Canadian economy."

The report is the first to make such an explicit link between the cost of meeting Alberta's greenhouse gas target - which would reduce emissions by 20 million to 25 million tonnes a year by 2020 - and the potential benefits.

"This is an investment. It's not a subsidy or cash dump," said Mike Long, a spokesman for Alberta electricity provider Capital Power Corp., which has long been a proponent of that very idea. "If you look at the royalty return on this, it's an investment and will pay off more so in the end."

Capital Power is behind one of three projects that the Alberta government has made eligible for funding to build a pilot carbon project. The $2-billion carbon-capture fund aims to have projects running by 2015. Additional funding of up to $3-billion a year would be needed between then and 2025 as work progresses to bring down the cost of the technology, Mr. Carter said.

Still, others are skeptical of how well anyone can predict the costs and benefits of capture technology the reports itself calls "embryonic."

"There's still a lot of open discussion about how much CO{-2} can be taken to enhanced oil recovery," said Wishart Robson, the climate-change adviser to Nexen Inc. chief executive officer Marvin Romanow.

But, Mr. Robson said, there is no doubt Alberta has a chance to use carbon capture to help generate additional money, an opportunity he called "unique."

"I can't think of many other jurisdictions in the world that actually have that kind of integrated opportunity to bring these forward at the same time."

Alberta ponying up $2 billion to make carbon capture and storage work

By The Canadian Press


EDMONTON — If a province were to be set up specifically for carbon capture and storage, it would look a lot like Alberta.

That’s a good thing, because if there’s one province that desperately needs carbon capture and storage to work, it is Alberta.

In an effort to do just that, the Alberta government announced Tuesday that seven companies will divvy up $2 billion from the province of Alberta to fund three carbon capture and storage pilot projects. The successful projects all combine capturing carbon dioxide from industrial emissions, transporting it and injecting it deep underground.

The companies selected for the funding include Epcor, Enbridge, Shell Canada, Chevron Canada, Marathon Oil Sands, Enhance Energy and Northwest Upgrading.

A spokeswoman for Enhance/Northwest says the dollar amounts for each of the projects will be subject to negotiations over the coming weeks.

But the urgency to make carbon storage and capture work is immediate.

Led by the carbon-intensive oilsands, the province is belching ever greater amounts of greenhouse gases into the atmosphere, a fact of which the world is increasingly aware.

And Alberta Environment says the solutions being tried elsewhere don’t work here.

“We don’t have those low-cost or even medium-cost reduction opportunities that a lot of jurisdictions do,” says Andy Ridge of the department’s climate change section. “Carbon capture and storage plays a critical role in what Alberta can do.”

Only 15 per cent of Alberta’s emissions come from vehicles compared with a more typical average of 25 per cent in other parts of the country. That means more efficient vehicles won’t cut carbon dioxide.

And while Alberta has one of Canada’s first wind farms, the great majority of the province’s already strained electricity supply comes from coal.

On top of that, many houses are relatively new, so retrofits won’t reduce energy consumption enough. The same goes for most of the industrial base.

About two-thirds of the province’s pledge to reduce carbon dioxide emissions by 200 million tonnes in the next 40 years is expected to come from carbon storage.

Fortunately, if pumping CO2 emissions underground to store them in perpetuity can work anywhere, it can work in Alberta.

“We think Alberta has some of the premier storage space around the world,” says Brent Lakeman, who manages the Alberta Research Council’s carbon and energy management program.

The very presence of energy deposits means the geology is favourable, Lakeman says. If the rocks were able to store oil and gas underground for millions of years, they can probably store CO2 as well.

Deep saline aquifers — another proposed CO2 repository even deeper than most oil deposits — are everywhere in the province. And Alberta’s geology is among the most stable in the country.

By 2015, the province hopes to have five or six working projects, injecting up to 10 million tonnes of CO2 a year into the ground. That sounds like a lot, but it won’t even reduce Alberta’s overall greenhouse gas emissions, which are expected to keep climbing until 2020.

Ridge defends that timetable. He says local industry would lose competitiveness if the provincial government moved faster than other jurisdictions.

Even in Alberta, CCS won’t be enough to bring greenhouse gas emissions under control.

But, perhaps more than in most places, it will be essential.

“If you don’t have this one in your toolbox, you’re in trouble,” says Lakeman.

Retrofitting saves millions in TransAlta's carbon plan

Keephills addition would be world's first

By Dave Cooper, Edmonton JournalJune 27, 2009


Behind TransAlta's Keephills generating station is land that could soon make history, housing the world's first chilled-ammonia carbon-dioxide-capture system to be "bolted on" to an existing coal-fired electrical plant.

The new system, from a Europeanbased global power generation firm, Alstom, is only now operating as a small test model. But TransAlta has chosen to take the plunge and use it as the heart of its proposed system to remove one million tonnes of CO 2 a year from its emissions.

"Alstom is very anxious for this project to go forward, and so are we. It will be groundbreaking for the industry," TransAlta spokesman Michael Lawrence said.

Called Pioneer Project, it is one of the finalists for assistance under Alberta's $2-billion carbon capture and storage (CCS) fund. At least three projects are to be selected later this summer.

TransAlta's project could be operating as early as 2012, taking part of the flue gas from a portion of one of the two Keephills turbine units, and capturing one million tonnes of CO 2 each year.

The compressed gas would be sent to partner TransCanada, piped away and injected deep underground to enhance oil recovery or to be stored in saline aquifers.

While power-generating neighbour Epcor Utilities is proposing an amine system for CO 2 capture that comes complete with a new power plant--a project which could cost $2 billion--TransAlta believes the future is more simple and inexpensive: retrofitting existing plants at a cost of hundreds of millions.

"Pioneer will be post-combustion, a system that can be retrofitted to existing power plants all over the world," said Ralph Leriger, Trans-Alta's Wabamun-area stakeholder relations manager.

He said the first phase is to take the flue gas, in this case a "slipstream," a portion of gas representing 100 megawatts of the 380-megawatt turbine output, and clean it to remove sulphur, nitrous oxides and particulates.

What is left is chilled, from 80 C to perhaps 5 C. The CO 2 can be stripped out of the chilled ammonia.

The CO 2 recovery rate is expected to be in the 90-per-cent range.

Steve Snyder, TransAlta's president, recently said Pioneer's system "will be one of the most advanced and has the highest potential, so a lot of people who are interested might want to be part of early projects to gain knowledge."

The Alstom technology is to be shared around the world, and partnerships allow it to advance more quickly, Snyder said.

He has said that with half of North America's electricity generated by burning coal, "kneecapping the economy for the sake of pursuing a pure environmental agenda is unthinkable, undesirable and undoable."

Synder said utilities must innovate and deliver energy while minimizing their impact on the environment.

"If we do things right, we see the potential to make coal-fired generation near carbon-neutral within the next 10 to 20 years."

Alberta officials said recently that the $2-billion CCS fund won't be spend immediately; in fact, over the next three years, just $800 million will be given out, $100 million of that in 2009. The full $2 billion is supposed to be distributed over 12 years.

dcooper@thejournal.canwest.com
© Copyright (c) The Edmonton Journal

HTC applying process to coal, gas-fired plants

Technology originally developed at University of Regina was for use in oil-recovery projects
Shawn McCarthy

Ottawa — Globe and Mail Update, Friday, Jun. 12, 2009 07:06PM EDT

HTC Purenergy Inc.'s patented, amine-solvent technology emerged more a decade ago from the University of Regina labs, where engineers were working on ways to produce low-cost carbon dioxide for use in enhanced oil recovery projects for North America's aging oil fields.

Now, HTC is partnering with some of the world's largest power-plant construction companies to include its carbon-capture technology in new coal-fired and natural-gas plants around the world.

The tiny firm is still headquartered on the university campus, and now trades on the TSX Venture Exchange. Last year, it signed an exclusive licensing agreement with South Korea's Doosan Industrial Co. Ltd., which hopes to build at least 600 clean-coal power plants using HTC technology over the next 25 years.

It has also partnered with U.S. giant Bechtel Group to apply the carbon-capture system to natural-gas fired power and industrial plants.

But it is the drive for “clean coal” that is the alchemist's dream of the 21st century.

Power plants account for 78 per cent of greenhouse gas emissions from stationary sources – that is, not including cars, trucks and airplanes – and coal is the cheapest, most plentiful and dirtiest fuel for power.

HTC chairman Lionel Kambeitz said global engineering firms expect to see the construction of some 5,000 coal-burning power plants over the next 25 years, and 60 per cent of them would include carbon capture and storage.

“Our objective is that, with the quality of the partner we have, we certainly would like to provide our technology on 20 per cent of the plants that are going to be built out there,” he said.

HTC Purenergy is among the companies forcing a reconsideration of capturing carbon from power plants and other industrial processes.

Until recently, most experts believed that the best approach would be to gasify the fossil fuel source – coal, say – and separate the CO2 before combustion.

But the capital costs of building an Integrated Gasification Combine Cycle (IGCC) plant are prohibitive, while HTC Purenergy and its giant competitors, like Fluor Corp. and Alstom SA, have driven down costs of post-combustion capture using ammonia-based solvents.

The key is how much energy is required to capture the CO2. HTC now promises its design uses only one tonne of steam for every tonne of CO2 captured, compared to 1.5-tonnes of steam for its competitors.

And Mr. Kambeitz said HTC expects to reduce the energy consumption of its process by 80 per cent in the coming years.

Analyst Khurram Malik, of Jacob and Company Securities Inc. in Toronto, says HTC Purenergy has established itself as the low-cost design through its super-efficient heating capture process and its designer solvents.

(Jacob Securities manages two funds that owns shares in HTC.)

He estimates the cost of capturing carbon from power plants could be as low as $20 to $40 per tonne – significantly lower than most published estimates – with HTC at the low end of the range.

And companies could recoup that cost by selling the CO2 to oil producers that use it to enhance recovery from declining fields.

“These are numbers that make it much more palatable [to build CCS plants] but they are numbers that are not in the general consciousness,” said Mr. Malik.

“If you attach it to a robust [enhanced-oi-recovery] project, you go cash positive from day one.”

The carbon capture conundrum

DID I SAY IT WILL BE TOUGH? “This is going to be one of the most complex diplomatic negotiations in the history of the world.” -- U.S. congressman Edward Markey, the co-sponsor of an energy bill that features cap-and-trade arrangements for carbon dioxide emissions

As pressure from governments grows for the oil sands to clean up its act, some energy producers are exploring carbon capture storage – a process that sequesters CO{-2} deep below the ground. But is the enormous cost, which would require massive government support and do little to address other sources of emissions, too much to pay?


Nathan VanderKlippe and Shawn McCarthy

Fort Saskatchewan, Alta.; Ottawa — Globe and Mail Update, Saturday, Jun. 13, 2009 04:13AM EDT

On a late-spring day beneath a warm prairie sun, some 6,000 construction workers and 30 cranes are at work on a $12-billion expansion to Royal Dutch Shell PLC's upgrader to boost its capacity for processing oil sands bitumen.

A short drive across the massive industrial complex near Fort Saskatchewan, Alta., a gravel lot sits largely empty – an idle crane, some pickup trucks, and a row of portable offices. It is, however, home to a controversial idea: This undeveloped lot is the would-be home for a carbon capture storage (CCS) project.

The technology known as CCS has been touted as the next major advance for an oil sands industry that appears to be on a collision course with governments' determination to battle climate change. In their struggle to soften Canada's reputation as a source of “dirty oil,” federal and provincial governments have placed a big bet on CCS, with plans to pump more than $3-billion into the technology.

Few other technologies hold the same promise, and indeed, few are being tested or funded to the same degree. And the spending is just ramping up. Later this month, the Alberta government is set to announce the winners of $2-billion in funding for carbon capture.

All this promise runs smack into the overarching uncertainty about carbon capture. The technology likely won't work where the oil is actually pulled out of the ground, but rather at the processing end. Even there, the economics simply don't add up. And the technology remains unproven at a commercial scale.

“We shouldn't see this as a silver bullet and be putting our eggs in this basket – particularly with public dollars – and ignore some of the cheaper and more effective options,” said Simon Dyer, the oil sands program director at the Pembina Institute, an environmental think tank.

Even federal Environment Minister Jim Prentice conceded recently that the technology will have limited application in northeastern Alberta, where companies produce bitumen either in open-pit mines or by injecting steam into underground formations.

Critics such as Mr. Dyer, and some within the energy industry, argue that government money is better spent on technologies that reduce the very creation of greenhouse gases – including new oil sands extractions techniques currently under development – and on cleaner forms of electricity generation.

Most of CCS's proponents acknowledge it won't contribute to reducing emissions from the oil sands projects themselves, where diesel-powered trucks and natural-gas-powered steam generators produce greenhouse gases that are difficult to capture. But industry and government remain confident the technology can be widely used on the upgraders and refineries that process the bitumen, as well as for coal-fired power plants.

Upgraders are critical components of the oil sands industry, transforming heavy bitumen into synthetic crude oil for further refining. But it is an energy-intensive process that drives up both costs and the emissions of carbon dioxide for oil sands producers.

Capturing their emissions could dramatically reduce the “carbon footprint” of oil sand projects, though critics doubt it could ever remove the environmental stigma from the controversial projects.

Still, some industry executives have not given up on the idea that CCS can eventually be useful in the mines and in-situ projects around Fort McMurray.

One of those is Murray Edwards, one of Calgary's most successful entrepreneurs and vice-chairman of Canadian Natural Resources Ltd., which is looking into injecting CO{-2} into tailings from its Horizon oil sands mine. And Mr. Edwards supports CCS even though even though he believes it will come at a cost. “In today's world, the process that we're proposing is not economically viable,” he said.

But the public purse needs to be wide open, he argues, to support what he believes will be a game-changing technology with wide application in the industry.

“If there's to be an important commitment on climate change and carbon emissions, there's going to have to be investment in technology, much like if the government hadn't mass-supported the railway it would never have been built,” Mr. Edwards said.

Profiting from emissions

If CCS is going to contribute to the Harper government's goal of reducing greenhouse gas emissions by 20 per cent from 2006 levels by 2020, the oil and power industries need to begin building demonstration plants now, industry executives say.

Companies are vying for huge pots of public money that would help underwrite the first projects, though even taxpayers' support may not be sufficient to spur the development, given the large capital costs involved in the proposed projects.

Alberta is set to announce several winners of a competition for some $2-billion in provincial funding to build demonstration plants. Saskatchewan has offered its own support, and Ottawa has promised $1-billion for clean energy technology, much of which will go to CCS.

The plan: To capture CO{-2} from power plants and upgraders, and then sell it to oil companies that will use it to enhance recovery from aging crude reservoirs, or inject it underground for permanent storage in deep saline aquifers.

At its Fort Saskatchewan upgrading site, Shell and its partners, Chevron Canada Ltd. and Marathon Oil Corp., hope to pioneer the capturing of CO{-2} to prevent its emission into the atmosphere.

On that gravel lot at the Scotford facility, they have sketched plans to build a unit that would process emissions, separating CO{-2} from other gases and diverting it out of the waste stream.

Across the road, the gleaming silver stack on Scotford's hydrogen production unit pours an invisible stream of CO{-2} into the air. Upgraders require hydrogen to break apart the bitumen molecules and create synthetic light oil.

While the entire upgrading facility produces 1.8 million tonnes of the gas every year, 40 per cent of that comes from the hydrogen plant, which burns vast quantities of natural gas.

Rather than rising out of a stack, all of the hydrogen plant's CO{-2} would be compressed into a liquid, piped to a well and injected 2,300 metres below the surface of the earth. There, it would seep into a massive aquifer filled with saline water and, if all goes according to plan, remain sequestered for a very long time.

Shell won't say how much the project will cost. And questions have been raised about the feasibility of building upgraders in Alberta, as U.S. refiners facing waning heavy oil supplies from Venezuela are adding capacity to handle the Canadian bitumen.

But if it goes ahead, Shell's project – known as Quest – will trim 25 per cent from the carbon footprint of its entire oil sands mining and upgrading operation.

That would be a significant step in a world that is quickly moving to put a price on carbon.

Devising a model

It's a key and still unanswered question: What price will Ottawa impose on carbon emission through its planned cap-and-trade system?

The emission limits imposed on the industry, and the design of the cap-and-trade system, will have a major impact on whether it becomes cost effective for companies to invest in pricey technology.

The dollars-and-cents dilemma remains central.

Industry officials expect the cost of capturing CO{-2} to fall dramatically as companies and governments around the world invest heavily in commercializing it. The numbers work best when there's a buyer for the CO{-2}, such as an oil company that can shoot the gas into old, faltering wells to push up more oil.

To feed that potential market, North West Upgrading Inc., a small Calgary-based firm, has its own plans to capture CO{-2} from an upgrader it hopes to build and then feed it through a pipeline network that would deliver the gas to central Alberta oil fields.

The company is modelling its idea on EnCana Corp.'s Weyburn plant in southeastern Saskatchewan, the world's largest CO{-2} sequestration/enhanced oil recovery project. EnCana buys the CO{-2} from a highly subsidized coal gasification plant in North Dakota, and has boosted oil production from its depleting Weyburn field.

North West chairman Ian MacGregor envisages building a $700-million “Alberta carbon trunk line” to carry the gas to where it's needed – similar to the natural gas gathering system that spurred the development of fields throughout the province.

“Alberta has the potential the produce to a lot more oil from existing fields,” Mr. MacGregor said. “We have all these reservoirs that are languishing because they haven't had the CO{-2} and couldn't get the CO{-2} until the world changed.”

The Alberta Research Council (ARC) estimates about 500 million tonnes of CO{-2} a year could be used to push oil out of the ground, though Mr. McGregor insists the potential demand could be four times that amount.

The rest would have to go underground. The ARC has calculated that the province has enough underground saltwater space to store 10 billion tonnes of CO{-2}; another three billion could go into oil and gas reservoirs.

But even once it's underground, questions remain.

Rules do not exist to govern how companies can own storage repositories, which party receives credit for disposing of carbon – is it the company that captures it or the one that stores it? – or who assumes liability for the carbon once it is buried.

Experts say the likelihood of buried carbon escaping is small. Nature kept natural gas and other substances locked underground for million of years, and they say there is little reason to expect any different for CO{-2}.

Still, because carbon is expected to stay underground for millennia, and because it is only valuable while locked up – if it escapes, carbon credits would need to be repaid – the question of who takes responsibility is an important one. And again, industry is looking to government for help, saying CCS doesn't work unless Ottawa shoulders long-term liabilities that companies won't want.

Enbridge Inc. has proposed a model where the Crown would own the storage space, and lease it to the company pumping carbon underground.

“With that long-term ownership, the Crown would also then have the long-term liability,” said Chuck Szmurlo, Enbridge's vice-president of alternative and emerging technologies. “It would be almost untenable for a company to take on thousands of years of liability.”

If you measure greenhouse gas output purely by what's produced in the extraction of Alberta's bitumen, the oil sands produce three times as much CO{-2} per barrel as regular crude. If you measure by the total carbon that flows from a barrel of crude – from the time it is pulled from the ground to the time it powers a city bus – the oil sands are 10 to 15 per cent worse than other oils, according to current industry estimates.

Either way, a stiff price on carbon would amount to a stiff penalty on the oil sands.

Putting a price on carbon

For the most controversial part of the oil sands process – the massive extraction plants near Fort McMurray – carbon capture is likely a red herring.

Among the chief offenders in the greenhouse gas hall of shame is the steam-assisted gravity drainage (SAGD) process. It essentially melts bitumen out of rock by pumping huge quantities of hot, high-pressure steam underground.

To create the steam, these operations must burn enormous quantities of natural gas; by 2025, fully 20 per cent of Canada's natural gas will be burned in the oil sands.

So why not capture the CO{-2} pouring out of their operations? Several companies have given it serious consideration, but abandoned the effort. The reason: While SAGD produces a lot of CO{-2}, it doesn't produce a concentrated stream.

“The amount of CO{-2} in the flue gas coming out of the steam boiler is about the same amount that's coming out of my mouth as I speak, 3.5 per cent or so,” said Robert Skinner, senior vice-president for commercial affairs with StatoilHydro.

The Norwegian company has the world's oldest carbon-sequestration project at its Sleipner natural gas field in the North Sea. But its efforts to tap Alberta's fund to capture oil sands carbon ran into a cost wall.

“Our own project alone, for one million tonnes [of carbon] a year, would have used nearly 75 per cent of the total $2-billion” in the provincial fund, Mr. Skinner said. “As an Alberta taxpayer, I would rather that money is used to get the biggest carbon bang for the buck. And that certainly is not in a SAGD plant up in the middle of nowhere.”

ConocoPhillips, which also examined and rejected a SAGD capture project, was more blunt: when it did the math, it found capturing, transporting and storing CO{-2} would cost $200 per tonne.

“We withdrew our proposal because of this number,” said Kevin Meyers, the departing president of the company's Canadian operations. “There are other technologies, other processes, other projects that are better suited to pursue CCS.”

None of this has, however, kept some in the oil patch from exploring ambitious CCS plans. Canadian Natural Resources is looking at piping carbon captured from an upgrader at its oil sands mine into its tailings. “To me it shows how technology can be applied in practical solutions to deal with carbon emissions, water usage and reduction in size and the speed of reclamation of tailings ponds,” Canadian Natural's Mr. Edwards said in an interview.

Pipeline builder Enbridge shares Mr. Edwards's belief in carbon capture. Enbridge has already secured underground rights to several deep saline aquifers – it believes it is the first to make such an acquisition – and has conducted engineering studies on a network of carbon pipelines that would criss-cross Alberta, transporting compressed CO{-2} from Fort McMurray and several coal-fired power plants to oil fields and aquifers.

It is also leading the Alberta Saline Aquifer Project, which has 38 industry members and is working on a pilot saline sequestration demonstration.

But the success of the project hinges, Enbridge's Mr. Szmurlo said, on how much governments are willing to support carbon capture. It will likely require the imposition of a substantial carbon price – through a tax or a cap on emissions.

“People have asked me, ‘How do you ever make a buck transporting and sequestering CO{-2}?' My answer is, the same way that waste management makes a dollar picking up the garbage in front of your house. It's deemed to be a societal good not to have your garbage lay in the alley. So society collectively contracts for a company to come along with a truck and pick up that garbage.”

“They may decide to employ the same model for their CO{-2}.”

Big spread in Calgary Herald on CCS

http://calgaryherald.specialsections.shoplocal.com/canwest/ss/index.aspx?view=pv&area=ss&type=page&adgroupid=130040&locations=calgaryherald

Decent read:

http://siliconinvestor.advfn.com/readmsg.aspx?msgid=25605729

.....If we're truly worried about carbon, we must instead approach it as if the emissions originated in an annual eruption of Mount Krakatoa. Don't try to persuade the volcano to sign a treaty promising to stop. Focus instead on what might be done to protect and promote the planet's carbon sinks -- the systems that suck carbon back out of the air and bury it. Green plants currently pump 15 to 20 times as much carbon out of the atmosphere as humanity releases into it -- that's the pump that put all that carbon underground in the first place, millions of years ago. At present, almost all of that plant-captured carbon is released back into the atmosphere within a year or so by animal consumers. North America, however, is currently sinking almost two-thirds of its carbon emissions back into prairies and forests that were originally leveled in the 1800s but are now recovering. For the next 50 years or so, we should focus on promoting better land use and reforestation worldwide. Beyond that, weather and the oceans naturally sink about one-fifth of total fossil-fuel emissions. We should also investigate large-scale options for accelerating the process of ocean sequestration.
Carbon zealots despise carbon-sinking schemes because, they insist, nobody can be sure that the sunk carbon will stay sunk. Yet everything they propose hinges on the assumption that carbon already sunk by nature in what are now hugely valuable deposits of oil and coal can be kept sunk by treaty and imaginary cheaper-than-carbon alternatives. This, yet again, gets things backward. We certainly know how to improve agriculture to protect soil, and how to grow new trees, and how to maintain existing forests, and we can almost certainly learn how to mummify carbon and bury it back in the earth or the depths of the oceans, in ways that neither man nor nature will disturb. It's keeping nature's black gold sequestered from humanity that's impossible.

If we do need to do something serious about carbon, the sequestration of carbon after it's burned is the one approach that accepts the growth of carbon emissions as an inescapable fact of the twenty-first century. And it's the one approach that the rest of the world can embrace, too, here and now, because it begins with improving land use, which can lead directly and quickly to greater prosperity. If, on the other hand, we persist in building green bridges to nowhere, we will make things worse, not better. Good intentions aren't enough. Turned into ineffectual action, they can cost the earth and accelerate its ruin at the same time.

Ottawa takes aim at coal power


SHAWN MCCARTHY

From Wednesday's Globe and Mail

April 29, 2009 at 1:11 AM EDT

OTTAWA — The federal government is planning sweeping new climate-change regulations for Canada's electricity sector that will phase out traditional coal-fired power.

Any new coal plants will have to include highly expensive – and unproven – technology to capture greenhouse gas emissions and inject it underground for permanent storage, Environment Minister Jim Prentice said in an interview yesterday.

Ottawa also plans to impose absolute emission caps on utilities' existing coal-fired power plants and establish a market-based system to allow them to buy credits to meet those targets, Mr. Prentice said.

Electricity users in Alberta, Saskatchewan and Nova Scotia would be hit hard by the new rules, as their provinces rely on coal for more than 70 per cent of their power, and alternatives will be costly.

“The approach that we've been working towards involves a cap-and-trade system relating to thermal coal, and the requirement of phasing out those facilities as they reach the end of their useful, fully-amortized life,” Mr. Prentice said.

“The concept is that, as these facilities are fully amortized and their useful life fully expended, they would not be replaced with coal,” the minister said.

He added that coal would be an option if it produced near-zero greenhouse gas emissions. The minister was attending a meeting of major emitting countries in Washington.

He said the new regulations will be released later this year – well before he travels to Copenhagen in November for negotiations on a new, global climate change treaty.

The government has already adopted new emission standards for vehicles – following the lead of the United States – and will also release regulations aimed at major industrial emitters, including Alberta's oil sands producers.

It has set a target of having a 90-per-cent emission-free electricity sector by 2025, a goal that will require increased use of nuclear, wind power, hydro and other renewables. Given Canada's long dependence on hydro in Quebec and British Columbia, and nuclear and hydro in Ontario, the country already has one of the least emitting electricity sectors in the developed world.

Still, coal-fired electricity represents roughly 18 per cent of Canada's current emissions, and eight of the 10 largest greenhouse gas emitters in the country are coal-fired power plants. They include Ontario's giant Nanticoke station, which the Liberal government has vowed to close by 2014 in its effort to be coal-free.

Most of Canada's fleet of coal-fired power plants date back to the 1970s, and would likely be decommissioned between 2020 and 2025. However, Alberta has one new operating plant at Genesee and another being built at Keephills that would operate for as much as 40 years.

Both Alberta and Saskatchewan have forecast large increases in electricity demands, especially in Alberta where expected growth in oil sand production and refining would drive up industrial electricity demand. Both provinces have massive coal reserves and said they will continue to rely on it to power their grids.

Jason Chance, a spokesman for the Alberta Ministry of Energy, said the province is committed to developing carbon-capture-and-storage technology, noting the government has allocated $2-billion for pilot projects in the power sector and oil industry.

Pierre Guimond, president of the Canadian Electrical Association, warned the new regulations would drive up electricity costs to customers in the provinces that are reliant on coal. “It's going to be awfully expensive,” he said.

He noted that the carbon-capture technology remains unproven and prohibitively expensive. However, some utilities have built modern coal plants that allow for the capturing of carbon dioxide, and oil companies often use CO{-2} to inject into crude reservoirs to stimulate production. The industry faces major challenges, however, in adopting an integrated capture-and-storage system within the next decade.

Epcor Power LP, of Edmonton, has spent more than $30-million in developing new combustion technology, and is hoping to win provincial funding to build a capture-and-storage project, along with its partner Calgary-based Enbridge Inc.

“We are absolutely supportive” of the federal proposal, said Epcor's executive vice-president, Brian Vaasjo. “We know that as the existing fleet of coal plants reach the end of their economic lives it will be important for there to be technology available that can be utilized to continue the use of coal.”

He said the new coal technology may even be cost competitive with nuclear and wind, though far more expensive than traditional coal-fired power. He added, however, that Alberta must be able to exploit its coal reserves.

“We're richer in coal than we are in oil sands, so it is critical that we be able to utilize that resource,” he said.

Nice little special on 60 Minutes this week.

Yup have too get it here cause were not getting any other hands outs

Yeah as far as I know that $2B is still in the pipeline
Gotta end up somewhere
I just want a few crumbs that get spilt along the way

Was just a play on this co2 chit and with ex premier involved you would think its got some clout with the AB government.

There suppose too release that stuff pretty soon no?

Awards and Contracts from AB government.

Pure gamble but like the odds of success on it cause of the people.

Still a Canadian company anyways and none of these guys are scam artists like the other stuff down there.

Not sure why Getty never got it listed in Canada though

Never bought at OTC stock myself.
Sent out an inquiry about Dolinski to an ex gov't aggie - see what they think about him.

HTC is my CO2 play presently.

ya 100k at .015 and still have them

About time this pos gives me a payday

Did you ever get in them?

CRSVF - CAPITAL RESERVE CANADA LTD A - Company Website http://www.capitalreservecanada.com

There hooked right at the hip in the Government Connections

So does the Government hand this same x Government people cash if they do it will be a cash cow from down here

The big question for me is where is the investment opportunity?

..."In 2008, however, DOE scrapped FutureGen over its soaring costs, turning the effort into a scramble for cost-shared R&D funding among many players pursuing their own, less ambitious projects. Among those companies in the hunt for carbon capture and storage solutions are GE, Praxair, Air Products & Chemicals, Alstom, and Foster Wheeler."

Gotta find out who comes up with the best answer/solution to the problem at hand.

The above are a start. The task will be to find that cheap, diamond in the rough, yet to be discovered, publically traded co.

Dave

.......but the next big question is: What to do with all that captured CO2

The big question for me is where is the investment opportunity?

Ottawa will pump as much as $140 million into eight demonstration projects in Western Canada which aim to capture and store carbon dioxide produced by power plants and the fertilizer and petroleum industries.

Projects in the Edmonton region include Epcor and Enbridge's Genesee project and TransAlta's Pioneer project, both in the Lake Wabamun area and both aimed at removing carbon dioxide from the flue gas of coal-fired power plants and injecting it into deep saline aquifers.

In the Fort Saskatchewan area, more support will go to the Heartland Area Redwater Project (HARP), a study by the Alberta Research Council and other groups that is being implemented by ARC Resources to store CO2 and enhance Redwater oil recovery.

As well, a CO2 pipeline project being designed by Enhance Energy to run from the Agrium fertilizer plant and upgrader alley to central Alberta for enhanced oil recovery has won support.

Ian Potter, vice-president for energy at the research council, said the first phase of the $50-million HARP is almost complete.

"We hope at the end of the day that the standard one-third formula, from the feds, province and industry will be followed. I know ARC Resources, which is doing all the fieldwork, have invested heavily in this project."

Ottawa will begin negotiations with the eight projects to determine how much will be contributed, but the range will be $3 million to $30 million per project, totalling no more than $140 million.

"Canada's tremendous reserves of energy will remain an important source of economic strength for a long time to come," said Natural Resources Minister Lisa Raitt. "The major challenge we face today comes from identifying and implementing cleaner ways to produce and consume that energy.

"Our government's support for the development of these innovative and promising technologies is just one of a number of important steps we're taking toward building a greener and more sustainable energy economy."

HARP is furthest along of the Alberta projects, with Phase 2 beginning this summer involving more wells drilled into the 1,000-metre-deep formation and continuing study.

Phase 3, the injection and monitoring of the CO2, will follow with the project completed by 2012-13. After that, commercial-scale injection of several thousand tonnes a day could begin.

The research council has thoroughly studied the Redwater reef, and concluded it could safely store more than a billion tonnes of CO2 in a deep saline portion of the reef that lies under several caprock layers, ensuring the gas would be completely contained.

Epcor's project involves building a new 150-megawatt coal-fired plant that would incorporate an amine scrubbing process to collect CO2 from the flue-gas. It will be transported by Enbridge to a deep saline formation. TransAlta is using different technology on an existing plant to try to achieve the same goal.
Carbon projects get $140M

Ottawa opens wallet to Western Canada to develop capture, storage technology

Don Lowry, Epcor's president, said "this funding will assist us in demonstrating that we can capture and store emissions from industrial-scale coal-fired electricity plants that use existing technology."

Enbridge president Patrick Daniel said carbon capture and storage (CCS) "has the potential to transform the environmental footprint of our energy economy and may be one of the best ways for Canada to reduce greenhouse gas emissions."

The Alberta companies are also among those which made the cut earlier this year for further review under the province's $2-billion CCS funding program. Four or five projects from a list of 20 could soon receive major support. Other approved projects include a Fort Nelson, B.C., gas-processing plant, Husky's CO2-injection research at Lloydminster, Sask., and a gasification facility in Belle Plaine, Sask.

Fixing Coal’s Carbon-Capture Problem
By Bob Williams | March 12th, 2009 @ 6:00 am

Changing U.S. environmental policy has upped the ante on what constitutes “clean coal.” Although the power industry has made great strides in cleaning up emissions of mercury, sulfur, nitrogen and other air toxins, the trick now is to also reduce coal-related emissions of carbon dioxide, considered the main culprit in climate change.

Since roughly a third of U.S. CO2 emissions come from power plants, carbon capture and storage technology implemented at power plants would seem to be the magic bullet industry is looking for. That’s why the Department of Energy spent years on the $1.8 billion FutureGen project, an ambitious effort to build prototype zero-emission, coal-fired power plants.

In 2008, however, DOE scrapped FutureGen over its soaring costs, turning the effort into a scramble for cost-shared R&D funding among many players pursuing their own, less ambitious projects. Among those companies in the hunt for carbon capture and storage solutions are GE, Praxair, Air Products & Chemicals, Alstom, and Foster Wheeler.

The toughest nut to crack is the challenge of capturing CO2 at power plants. Three approaches are under consideration in DOE’s carbon capture R&D program: pre-combustion, post-combustion, and oxy-combustion.

Pre-combustion captures CO2 after the coal is converted to synthetic gas in a coal gasification process, but before the syngas is burned to generate power. The other two options entail add-on technologies at existing coal-fired plants that would capture the CO2 after the coal is burned.

A new Pratt & Whitney Rocketdyne gasifier design shows promise in working more efficiently and producing cheaper electricity than gasifiers from GE and Shell that are already widely available commercially.

A Trimeric Corp. post-combustion R&D project demonstrated that using advanced solvents to “scrub” CO2 from the waste gas of an existing coal-fired power plant can cut the cost of carbon capture by as much as 18 percent versus conventional scrubbers.

On the oxy-combustion front, a Foster Wheeler Development Corp. project led to a process that burns the coal in oxygen instead of air, making it easier to capture the resulting CO2. In terms of electricity and CO2 capture costs, Foster Wheeler contends its process is competitive with the most advanced commercial gasification process today.

Making headway on CO2 capture costs is good news for the coal and utility industries, but the next big question is: What to do with all that captured CO2?

http://industry.bnet.com/energy/1000707/fixing-coal%E2%80%99s-carbon-capture-problem/

There has got to be an angle here somewhere

Obama said he would like to work with Canada on developing carbon capture and storage to deal with the emissions coming out of both the American coal and Alberta oil industries

http://siliconinvestor.advfn.com/readmsg.aspx?msgid=25422206

Carbon capture on provincial Tory agenda


By Renata D'Aliesio, with files from Trish Audette, Calgary Herald; Edmonton JournalFebruary 10, 2009



Despite its new cash-strapped reality, the Alberta government is pushing ahead with a $2-billion pledge to kick-start capturing and storing carbon emissions from coal power plants, heavy-oil upgraders and potentially the oilsands.

Government house leader Dave Han-cock said a bill setting up the fund is one of at least 26 pieces of legislation that will be introduced this month, after the legislature resumes today with a throne speech.

"It's a clear signal to Albertans and to Canadians and others that we're committed to the carbon-capture strategy . . . to the absolute reduction through carbon capture and storage of CO2," said Hancock, who's also education minister.

Other key bills include giving some Alberta colleges the option of becoming universities, pushing ahead with a new land-use strategy that divides the province into seven planning regions, and strengthening enforcement of rules that prohibit the government from paying certain lobbyists for advice.

Retirement savings will also be up for debate. Hancock said the province has been working for a while on legislation to safeguard registered retirement saving plans from creditors. At the moment, creditors can go after the cash in those plans even before an individual is allowed draw from them.

"If you have a pension plan that builds up, that's not something somebody can seize or take away from you,"Hancock said. "What this does is put on the same basis the investments that an individual might make into an RRSP because if you don't have a pension plan, if you're creating your own pension plan, you should have the same kind of protection."

Several other provinces already offer this safeguard for RRSPs.

Tuesday's throne speech is expected to take a much different tone than last year's, when the province and oilpatch were flush with money and labour short-ages were a pressing problem.

"The primary focus of this session will be on jobs," Premier Ed Stelmach said last week. "It will be integrating energy, the economy, the environment.Pursuing the technologies that are necessary to ensure Alberta continues to be a leader in these areas."

According to Statistics Canada, 5,700 jobs were lost in Alberta in January.

TransCanada joins TransAlta carbon capture project


By Dave CooperDecember 18, 2008



EDMONTON — TransAlta Corp., owners of major coal-fired power plants west of Edmonton, said Thursday that TransCanada Pipelines would join its Project Pioneer, a proposal to become Canada’s first fully integrated carbon capture and storage facility.

When complete, the project would capture one megatonne of carbon dioxide from a Keephills or Sundance unit using a chilled ammonia system from Alstom Canada, and pipe the CO2 to be injected deep underground, either for enhanced oil recovery or into a saline aquifer.

TransCanada is also seeking other industry partners from the oil, natural gas and oilsands sectors. Both TransAlta and TransCanada have been selected for further review and may qualify for funding under Alberta’s $2 billion carbon capture and storage development fund, which aims to promote projects that will remove five megatonnes a year of CO2 from emissions.

Edmonton’s city-owned Epcor Utilities, which has a power plant at nearby Genesee, is considering a similar project and is also among the 20 projects under review.

TransAlta has plan to turn black coal 'green'
Carbon capture and storage four years away

Dave Cooper
The Edmonton Journal

Thursday, November 20, 2008


EDMONTON - With half of North America's electricity generated by burning coal, "kneecapping the economy for the sake of pursuing a pure environmental agenda is unthinkable, undesirable and undoable," says the president of Alberta's biggest power firm.

Instead of the premature closing of power plants, the answer for TransAlta Utilities is to turn black coal "green," says Steve Snyder. His firm could have a carbon dioxide capture and storage system operating at one of its coal-fired electrical power turbines within four years, he told the Edmonton Chamber of Commerce on Wednesday.

Advanced engineering is underway on "Project Pioneer," which will see a unit at Sundance or Keephills south of Wabamun Lake retrofitted with new technology from Europe's Alstom.

He says the pilot unit, using a chilled ammonia process, should recover 90 per cent of the carbon dioxide gas -- about one million tonnes a year. A study is underway to find the best place to inject the gas into Wabamun-area geological formations.

"The beauty of retrofitting is that you just tag on to your existing infrastructure," he said, adding that the Wabamun project "will be the world's largest, and only, stem-to-stern carbon-capture project, from the plant to separating the CO2 to capturing it and sequestering it in a reservoir."

Snyder says utilities must innovate and deliver energy while minimizing their impact on the environment.

"If we do things right, we see the potential to make coal-fired generation near carbon-neutral within the next 10 to 20 years."

With support from the Alberta government, the move to carbon capture would receive a kick-start that could see the province become a world leader in clean-coal technology, similar to what happened when tax changes pushed development in the oilsands in the late 1990s, he says.

Alberta has 33 billion tonnes of coal, 70 per cent of Canada's total reserves.

"Coal is reliable and relatively low cost. To simply say 'no' to coal without first exploring every avenue possible to eliminate its emissions cost-effectively would be a flawed approach," he said.

But carbon-dioxide capture is a critical solution to reducing global emissions. "Without it, one simply cannot see any realistic way to achieve the targets necessary to help our planet," said Snyder. As a result, many billions of dollars will be spent the technological answers, and "Canada and Alberta should make their fair contribution also, and reap the resulting benefits," he said.

Aside from technology, Snyder said market tools such as offsets and emissions-trading can help move the world towards a greener economy. Government rules and regulation on the environment must be "clear, realistic and integrated," with a harmonization of proposed federal and various provincial policies.

In Alberta, Snyder says new power transmission capacity is essential if customers demand more wind power generation from the southern part of the province.

Epcor is also planning a flue gas collection system and a pilot gasification plant at its nearby Genesee site.

Alberta's $2-billion carbon-capture innovation fund aims to kick-start four or five projects that will remove five million tonnes a year of carbon dioxide from the atmosphere. Twenty companies, including TransAlta, have been asked to submit detailed proposals by March, 2009.

Last year, the Canada-Alberta Task Force on Carbon Capture and Storage determined that by 2050, 600 million tonnes a year of greenhouse gases could be removed across the nation, which would be 40 per cent of Canada's total projected emissions. That would be equivalent to removing all of Canada's current industrial emissions without losing critical economic services and value, says Snyder.

dcooper@thejournal.canwest.com

Twenty firms chosen for carbon program
Oilsands producers join Epcor on gov't list

Dave Cooper
The Edmonton Journal

Thursday, November 13, 2008

EDMONTON - From a group of 50 expression-of-interest applications, Alberta has selected 20 firms that will proceed to the next stage of the government's $2-billion carbon capture and storage funding program and prepare detailed proposals.

City-owned Epcor announced last week that it had been selected for its Integrated Gasification Combined Cycle (IGCC) project at Genesee that would deliver the first commercial scale near-zero emission thermal power plant in Canada, but no other company said it had been officially notified until Wednesday.

At Suncor, an official said the firm was looking at "how best to approach the emission question," and will decide about retrofitting in the future.

"It's early days, we will now get more specific," said spokesman Brad Bellows.

Syncrude is at the same stage.

"We're studying how best to tackle this and will have a course of action by the next deadline of March 31," said spokesman Mark Kruger.

All the other major oilsands companies -- Canadian Natural Resources, ConocoPhillips Canada, Total E&P, Opti Canada, Petro-Canada, Statoil Hydro -- were on the government's list, as the industry begins to come to grips with climate change.

Shell's Quest program announced this month, which will see carbon dioxide collected from the Scotford upgrader either buried in the Redwater area or moved into a pipeline, also made the list.

Enhance Energy, which has been planning the first CO2 pipeline from the Industrial Heartland just north of Fort Saskatchewan to central Alberta for enhanced oil recovery, was listed with its Northwest Upgrading project partner. Construction has not started on the Northwest facility, but Enhance has an arrangement with Agrium fertilizers to supply enough CO2 to justify a pipeline.

Enbridge and TransCanada, two pipeline firms, were also listed for their plans to transport collected CO2. Oilsands emitters eventually expect to move carbon dioxide from the Fort McMurray region for use in enhanced oil recovery or deep injection into saline aquifers in central Alberta.

Other energy firms on the list were ATCO Power and TransAlta Utilities. TransAlta plans to test a French carbon-capture system at Wabamun west of Edmonton. Epcor is also testing a flue-gas recovery system at its nearby Genesee plant.

The list also includes the following firms: Sherritt International Corp., Swan Hills Synfuels, Hydrogen Energy and Enoch Cree Nation/Teedrum Inc.

dcooper@thejournal.canwest.com

Straub an unlikely climate protector

Bruce Johnstone
The Leader-Post

Saturday, November 08, 2008

It's not often you hear senior oil company executives calling for more government regulation of greenhouse gas emissions.

But that's exactly what Brian Straub, president of Shell Canada, told a news conference Thursday to announce Shell's $5-million contribution to advance carbon capture and storage (CCS) technology at the University of Regina.

Straub said Shell envisions several different scenarios in which the world will deal with the conflict between rising energy demand and increasing greenhouse gas (GHG) emissions and climate change.

At one end of the spectrum is the "scramble" scenario, in which "events outpace actions, and the greenhouse gases aren't seriously addressed until there is major climate shock,'' Straub said.

At the other end is the "blueprint'' scenario, which envisions a "world in which actions outpace events, and coalitions ... emerge to accelerate change.''

While recognizing that reality is likely to fall somewhere between these two "extreme" scenarios, Straub said Shell "by far prefers the blueprint scenario and believes that this outcome offers the best outcome for a sustainable future.''

Shell sees six different "pathways'' or solutions to the climate change-energy-crunch crisis; one of them is carbon capture and storage, another potential solution is public policy, Straub said.

CCS technology offers the promise of taking CO2 out of the emission stream of, say Shell's Scotford upgrader and refinery complex near Edmonton, and storing it in the ground.

Better yet, the CO2 could be used to increase recovery of hydrocarbons by injecting it into mature oil-bearing formations -- the environmental equivalent to having your cake and eating it too.

"The large volumes of GHG emissions reduction that could be realized by CCS make this technology a promising solution to address climate change in the near future.''

Straub said government must also play a critical role in reducing GHG emissions by industry.

"It often comes as a bit of surprise to hear a major oil company advocating more and better public policy guidance,'' Straub said. "But that's exactly what we're after.

"We believe the time for voluntary action is past and must be replaced by consistent government policy on a Canadian, North American and global basis.''

Straub, who worked as a petroleum engineer at Shell's Midale CO2 enhanced oil recovery project in the 1980s, is no bleeding heart, greener-than-thou environmentalist.

But even he sees that the time for "voluntary measures'' and "best-efforts'' to reduce GHG emissions has come and gone.

Straub's desire for a stronger, definitive regulatory regime for CO2 emissions is not motivated by his desire to save the planet from global warming.

Rather, it is borne by the businessman's desire for the proverbial level playing field in which everyone plays under the same rules.

"We believe now is the time for policy direction and regulation,'' Straub said following his formal remarks.

"The era of voluntary targets is behind us. We really need a level playing field globally that we all work under.''

And it appears as though the newly elected Harper government is finally listening.

In Prime Minister Stephen Harper's new cabinet, Tory attack dog John Baird has been replaced in the environment portfolio by the more conciliatory, less rabid Jim Prentice.

More importantly, Harper has sent out signals that he wants to work with the newly elected Obama government in the U.S. on some sort of environmental pact that would include a cap-and-trade system to reduce GHG emissions.

For a former climate-change denier, like Harper, that's a big step.

But when oil company presidents start sounding the alarm about the need for firmer rules and regulations around carbon emissions, can the Conservative government be far behind?

Shell, province invest in research

Bruce Johnstone
Leader-Post

Friday, November 07, 2008

The provincial government and Shell Canada are each investing $5 million into an international research centre at the University of Regina to develop, test and ultimately commercialize carbon capture and storage (CCS) technology.

The new centre, called the International Performance Assessment Centre for Geologic Storage of CO2 (IPAC-CO2), will assess and advise CCS projects around the world and share findings with other research organizations.

In addition, the province is putting another $2 million into the European CO2 Test Centre at Mongstad, Norway, which will test carbon capture technology developed at the U of R.

"If Canada is to continue to produce and use fossil fuels, we will need to learn how to find a way to effectively store CO2,'' said Crown Corporations Minister Ken Cheveldayoff at a news conference at the U of R Thursday.

"With the University of Regina solidifying its position as a world-leader in CCS research and technology development, an important next step is establishing ties around the globe with other institutions pursuing similar goals.''

Brian Straub, president of Shell Canada, said the company's parent, Royal Dutch Shell, believes world demand for energy is growing far faster than supply, conventional oil and gas are becoming harder to find and the world is turning towards alternative forms of energy, including renewables, nuclear and biomass.

"So we're going to need hydrocarbons, like the oilsands in both Alberta and Saskatchewan, but they require more technology, more energy, more money and significant patience to extract.''

Unfortunately, these unconventional sources of fossil fuels are going to create more greenhouse gas (GHG) emissions, he said. "Therefore, the big energy challenge is how to meet the increasing global demand for energy with unconventional resources, while significantly reducing these emissions.''

CCS technology represents the one of a number of solutions to the global energy-climate change challenge, Straub said.

"The large volume of GHG emission reductions that could be realized through CCS make this technology a promising solution to address climate change in the near future.''

Shell's investment of $5 million into IPAC-CO2 will test the technology of carbon capture and storage and ultimately help make CCS "commercially viable.''

"Shell's ambition is to develop substantial CCS capability around the world,'' Straub said. "Western Canada is a key area for us."

For example, Shell is a sponsor of the Weyburn-Midale CO2 monitoring project -- "one of the world's three largest in-field carbon storage research projects and largest CO2 enhanced oil recovery project on land,'' Straub said.

Vianne Timmons, president of the U of R, said the province and Shell are making "an important investment in our environmental future'' by establishing and supporting IPAC-CO2.

"Climate change is a global problem that requires global solutions and IPAC-CO2 will go beyond the province's borders to work with, and build on, the best CCS research available...

"We're entering a new stage of carbon capture and storage (technology) development, not just at the U of R, but also Western Canada.''

Malcolm Wilson, acting director of IPAC-CO2, said the centre will help research scientists better understand what happens when CO2 is injected several kilometres beneath the earth's surface.

"When we look at the subsurface, we really know very little about it. There's always uncertainty involved. What the centre will do is provide a mechanism for reducing that uncertainty.''
© The Leader-Post (Regina) 2008

Enhance looks for Heartland's CO2
Fledgling company first out of the chute with a carbon-capture pipeline

Dave Cooper
The Edmonton Journal

Thursday, November 06, 2008

EDMONTON - With just one long-term supply contract in hand, Enhance Energy says it's still full speed ahead for Alberta's first carbon dioxide pipeline.

"We are building for the future, and there will be a lot of CO2 in the Industrial Heartland," president Susan Cole said Wednesday, on her way to an open house in Fort Saskatchewan.

The event, one of several along the route of the 240-kilometre route, is part of the regulatory requirement for building a pipeline.

Enhance will construct a drying and compression facility at Agrium's Redwater complex to bring its almost pure carbon dioxide gas up to pipeline specifications. The fertilizer firm is Alberta's largest producer of pure carbon dioxide.

Bitumen upgraders can be modified to capture much of their CO2. But coal-fired power plants, the largest emitters of the greenhouse gas, face a major challenge to accomplish this.

Cole said Agrium will contribute about one-third to the pipeline's initial 5,000-tonne-per-day capacity.

"As the number of sources increase, we will stage it up to 25,000 tonnes per day or more by adding pumping stations," she said.

Enhance also has a contract with the North West Upgrader, but that project is on hold.

Shell recently announced it will eventually inject CO2 from its Scotford upgrader deep in a local underground reservoir. That CO2 could also be shipped out on the Enhance pipeline.

The proposed 16-inch, (40 cm) diameter pipeline will travel east from the Redwater area around Elk Island National Park and then south through Tofield and Hay Lakes to the Clive area east of Lacombe, where it will be used for enhanced oil recovery in depleted fields in the area.

Construction of the pump station could begin as early as late 2009, with the pipeline installed in mid-2010.

Cole said the line is being routed far east because the area west of the national park and closer to Edmonton is "congested" with other pipelines and higher population density.

"It's also an environmental choice. We didn't want to go through the park," she said.

Like other petroleum and energy firms, Enhance will apply for a share of the provincial $2-billion carbon capture fund.

"We hope to work with the government on this project. It would certainly help us," she said.

Because CO2 must be kept under pressure so it will flow like water, the high-vapour pressure line will be built to the same standards as a natural gas line. The difference is CO2 is non-flammable.

dcooper@thejournal.canwest.com

Carbon capture could be our green panacea
Shell Canada ready to go with project, but Alberta needs regulations and standards to make these plans feasible

Paula Simons
The Edmonton Journal

Saturday, October 18, 2008

You might call carbon capture and storage the great white whale of greenhouse gas reduction.

The premise is so simple. Instead of just cutting our carbon dioxide emissions, we capture the waste CO2, and pump it underground, removing it from the atmosphere indefinitely.

It sounds almost too good to be true -- a technological fix that doesn't mean a drastic reduction in our industrial production or our personal lifestyles. And yet, carbon capture isn't something we should just laugh off as an end run around real CO2 reduction.

Climate change is real, and it's happening now. We can't stop the polar ice caps from melting with LED Christmas lights and cloth grocery bags. We need larger-scale solutions, ones that will allow us to keep our local energy economy functional, while at the same time mitigate rising global temperatures.

Carbon storage is a practical stop-gap measure. It buys the planet time. Time to commercialize other forms of renewable energy, time to develop cars that don't run on gasoline, time to change consumer expectations.

And Alberta, geologically speaking, is an excellent place to pioneer this technology. The Western Canadian Sedimentary Basin, which is also the source of our oil and gas, looks ideal for deep-well CO2 injection. It's estimated that there's room for one gigatonne of CO2 under the Leduc Reef formation alone. We could likely inject 100 years worth of Alberta's carbon production underground and use less than 10 per cent of our storage capacity.

The provincial government, of course, is counting on carbon capture as Alberta's green panacea. The Tory's CO2 reduction strategy assumes carbon capture and storage will account for a boggling 70 per cent of Alberta's emission reductions. Premier Ed Stelmach has even earmarked $2 billion of the forecast surplus to help jump-start carbon capture project in Alberta by 2015.

There are at least a half a dozen Alberta energy companies with carbon capture projects under discussion, but Shell Canada hopes to be one of the first to dip into that $2-billion fund.

This week, the company unveiled a proposal for a major CO2 capture project at its Scotford upgrader near Fort Saskatchewan.

The Quest project would capture about 40 per cent of the upgrader's carbon emissions. The gas would then be compressed into liquid, and injected, via steel pipe, 2.5 kilometres beneath the surface, in the basal Cambrian sands, under dense layers of cap rock. The goal would be to capture and sequester 1.2 megatonnes of CO2 each year.

Shell will drill three to five test wells, over the next six to nine months. If all go well, and the company receives regulatory approval, it hopes to start building the carbon capture facility in 2010, and begin sequestration by 2013.

Shell says the test wells alone will cost $20 million -- though $6.6 million of that will come from the provincial department of technology, through the Alberta Energy Research Institute. (That's a pot of money quite separate from the $2-billion carbon capture kitty.) How much will the final project cost? Shell will only say, coyly, that it will likely be more than $500 million.

Right now, the province charges companies that don't meet their emission reduction targets a $15-a-tonne levy, money that goes into the Climate Change and Emissions Management Fund. Shell estimates it will cost $80 to $140 a tonne to build and operate its proposed carbon capture facility -- meaning it's cheaper to pay the levy than to store the gas.

"The price of carbon will have to be higher in order for these projects to move forward," says Rob Seeley, Shell Canada Energy's general manager of sustainable oilsands development.

While he won't go so far as to call for a carbon tax, Seeley says there must be tougher North America-wide regulation of greenhouse gas emissions in order to convince companies like Shell to invest in carbon capture.

"We need to do this," he says. "The time for action is now. The debate about global warming is over." Yet until North American governments set a true price on carbon, companies will have no incentives to make these huge investments in greenhouse gas mitigation. We need both sticks and carrots, taxes and incentives. Alberta's $2-billion carbon capture fund sounds huge, but it's a pittance, compared to the cost of large-scale carbon capture. The government can't be in the business of bankrolling these projects. Companies themselves have to pay, even if that means passing costs onto consumers.

What the province can do, however, is put in place the regulations and licensing standards, and safety protocols these deep CO2 wells are going to need -- and figure out how to value and divvy up the underground "storage space" which belongs to the Crown.

Time is running out. While politicians bicker over turf and tactics, the temperatures and the seas are rising. If we're serious about making Alberta a world leader in carbon capture and storage, if we're serious about reducing our carbon footprint so that our oil isn't subject to boycotts and trade sanctions, the province has to move quickly to establish the regulatory and tax regimes we need to make such systems work.

Shell unveils $20-million CO2-storage project

Dave Cooper
edmontonjournal.com

Thursday, October 16, 2008

FORT SASKATCHEWAN - Shell unveiled plans today to begin a $20 million carbon dioxide storage research project that could eventually see one million tonnes of CO2 from the Scotford upgrader injected down a 2,000- metre deep well.

The provincial government said it will kick in $6.6 million over three years as part of its effort to encourage the development and commercialization of CO2 capture and storage.

"This kind of project is critical for the long-term goals of Alberta," said Technology Minister Doug Horner.

"Field tests are needed to understand how different kinds of geological formations will handle CO2 storage," he said.

The Alberta Energy Research Institute is providing the money. The Alberta Research Council also has several studies underway. The various pilot projects are pre-commercial and are not intended to tap into Alberta's $2 billion carbon capture and sequestration fund, which will support three to five commercial scale projects that will reduce carbon emissions in the province by up to five million tonnes annually by 2015.

"We're backing up our commitment to pursue these technologies. Alberta's strategically investing in the science and technology needed to find global environmental and energy solutions, said Horner.

Rob Seeley, manager of the Shell Quest study, says a public information session this evening in Fort Saskatchewan is the first step in the process.

"This is for public awareness. Next we will drill three to five test wells, and then do more work to prepare our application," he said.

The first well will be at the Scotford upgrader site, with the next one 10 kilometres away and a third, 30 kilometres distant. Then two more wells may have to be drilled to understand the geology of the area.

"This area was not drilled for oil, so there are few cores available to study," he said.

It also means there are very few holes in the cap rock which lies over the deep saline-saturated formations.

Seeley says the technology to capture the CO2 from the upgrading process is well known. Storage of the gas needs more study.

Engineering and design work on the bitumen upgraders to add carbon capture is already underway. If the project gets the green light Shell will be able to quickly start capturing and injecting small amounts of CO2, between 50 and 100 tonnes per year, and then ramp up to one million tonnes.

The existing Scotford upgrader produces 155,000 barrels of synthetic oil a day, and 1.5 million tonnes of CO2 a year. The 100,000 barrel expansion which is still under construction will produce about one million tonnes a year.

"We can capture 40 per cent. But this is not a an inexpensive business. The industry average cost is between $80 and $140 a tonne, for capital and operating costs.

Aging oilfields could turn CO2 pipe dreams into reality
Pilot projects put harmful emissions deep underground

Dave Cooper
The Edmonton Journal

Sunday, October 12, 2008


EDMONTON - A "bullet" truck pulls up to an oilfield battery near Redwater. The pure carbon dioxide in the long pressurized tank could have gone to the Coca-Cola plant to add the fizz to soft drinks, or to any of a number of other uses.

But today, the stop is on farmland dotted with oil wells, with the gas intended to go deep underground.

Alberta hopes to turn this declining oilfield into a giant storage area for carbon dioxide, a greenhouse gas produced in large amounts by the local chemical and petroleum industry.

Burying the gas can burnish the province's environmental reputation. Oilsands plants are big emitters of CO2, resulting in critics targeting Alberta.

The provincial government will spend $2 billion to encourage several carbon dioxide capture and storage projects. Injecting the gas into oilfields is a win-win situation: Not only does it keep the CO2 from being released into the atmosphere, the added pressure makes it easier to pull the oil out of the ground.

The destination for this load of CO2 is the Redwater reef, formed 400 million years ago when the area was a tropical coast. The launch of the Alberta oil boom in the late 1940s saw more than 1,000 wells sunk in the 600-square-kilometre once mighty oil reservoir, but half now stand abandoned and many more produce little oil.

Enter the Alberta Research Council and its Heartland Area Redwater Project, a long-term carbon storage study that could eventually cost $50 million. The council hopes to see large amounts of CO2 sent into the 1,000-metre deep formation by 2015.

ARC Energy purchased most of the wells from Imperial Oil in 2005, intending to use carbon dioxide to enhance recovery of the remaining oil.

The research council is studying large capacity storage areas, and was more interested in the 80 per cent of the reef that did not contain oil, but saline water, where the carbon dioxide would also be injected.

"Right now we are studying drilling cores to understand the geology. This spring ARC Energy will sink a data well for us," says Brent Lakeman, manager of the research council's carbon and energy management program.

ARC Energy itself has begun to inject small amounts of CO2 into the formation in order to recover more oil.

"We got the tanks up and began the process in July. Typically pilot wells like the one we have will inject 100 to 200 tonnes a day," said Doug Bonner, senior vice-president for corporate development at ARC Energy.

A commercial-sized operation would inject 10,000 tonnes per day. That's the equivalent of taking 650,000 cars off the road, but not a huge amount in the total Alberta picture -- the province produces more than 230 million tonnes of carbon dioxide each year.

The Redwater reef alone could store more than a billion tonnes of CO2, scientists believe. And with Alberta and southern Saskatchewan as rich in sedimentary rocks as they are in oil and gas, there are many similar, albeit less well-known, potential storage sites.

Surface monitoring is in place in Redwater, although the solid formation is not expected to leak.

"The oil there has been trapped for many millions of years," said Bonner, adding that if it was going to move, it would have done so by now.

Until large-scale commercial sources of carbon dioxide can be captured, however, ARC Energy is buying food-grade CO2 from suppliers in the Fort Saskatchewan area.

"The CO2 we buy can go into Coke," said Bonner.

Stefan Bachu, the research council's principal scientist for CO2 geological storage, says there are three key elements to choosing the correct site.

"You must have the capacity in the formation," he said, so the column can hold the gas under high pressure and in a very dense form.

"Second, you need injectivity -- permeability in the rock. And third, you need to have complete containment."

The gas that will be injected into the saline portion of the Redwater reef will be under several caprock -- or hard rock -- layers.

Injecting gas is not new in Alberta. Since gas flaring was stopped in 1989, that "acid gas" has been injected at 40 sites in the province. The volumes are small, however -- about one million tonnes a year -- compared with how much carbon dioxide will have to be injected in the future.

For instance, Suncor alone produces eight million tonnes a year of CO2.

Capturing carbon dioxide from the manufacturing and upgrading processes used by chemical plants and the oilsands is "the low-hanging fruit," said Bachu.

"The real issue is coal, not the oilsands," said Bachu.

It is much more difficult and expensive to capture gases after combustion, he said. TransAlta's Sundance coal-fired electrical generation plant at Lake Wabamun, for example, produces 16 million tonnes of CO2 a year.

Re-injecting CO2 found in natural deposits has been done since the 1970s to revitalize Texas oilfields. But injecting synthetic CO2 is new.

Canada's major project is in Weyburn, Sask. EnCana pipes in a supply from a North Dakota coal gasification plant and injects it to produce more oil. Begun in 2000, the pilot project pumps in one million to two million tonnes a year and has been closely followed by researchers from around the world.

What has been learned there can be applied to other CO2 enhanced oil production projects.

Enhance Energy is proposing a pipeline to take CO2 from Fort Saskatchewan emitters to oilfields in the Lacombe area.

"Having a market with oil firms helps pay for the infrastructure," said Enhance president Susan Cole, who worked on the Weyburn project.

"I'd say half the oil pools can benefit from this. We can recover another 20 per cent of the oil from a field, and that could eventually mean billions of barrels of new oil production for Alberta," she said. Pipeline construction could start as early as 2010.

A government-funded study in co-operation with major oil and chemical companies, called the ICON project, has several proposed pipeline options, with a construction target of 2015.

Shell is also planning capture carbon both from its existing Scotford upgrader and the expansion that is now being built.

Depending on the market, the firm may sell the gas and store the surplus in a nearby reservoir, says Rob Seeley, manager of the Quest project.

While the upgrader built in 1999 will be retrofitted for CO2 capture, so will the expansion unit.

"It was designed five years ago," said Seeley.

In a world fearful of climate change and demanding a different way of doing business, that seems like a long time ago.

http://www.pinntech.com/CO2_Sequestration.html
CO2 SEQUESTRATION
Carbon Dioxide Sequestration is an up and coming technology to combat global warming and Pinnacle is leading the way in helping prove the technology to be a safe and cost effective method of carbon dioxide emissions reduction. Pinnacle is currently working with a number of regional sequestration groups in the US as well as others internationally to assist with containment monitoring and risk reduction. Monitoring, Mitigation and Verification (MM&V) is a key component in CO2 sequestration. The ability to measure the volume of carbon dioxide stored, monitor a site for leaks and verify that the CO2 is stored permanently is a requirement of any successful sequestration project.

Pinnacle Technologies can provide up front risk analysis for projects and deploy a series of complementary technologies to directly and indirectly measure where carbon dioxide is migrating underground. With the ability to deploy tiltmeters with nano-radian accuracy to INSAR with huge spatial coverage, we have the ability to apply the right technology to the problem at hand. Pinnacle also offers downhole electronic pressure and temperature gauge installation services as well as fiber optic Distributed Temperature Sensing (DTS) sensors which can monitor realtime temperature along the entire wellbore. In the area of seismic monitoring, we offer everything from microseismic monitoring to 2D & 3D VSP and crosswell seismic survey data acquisition, processing and interpretation.

With this broad range of services, Pinnacle is a one stop shop for MMV services globally. Also through our propriety integration of technologies like InSAR, high resolution GPS and tiltmeters, we feel that we offer the most cost effective option for truly long term monitoring of large CO2 sequestration projects.

Pinnacle plans on working with sequestration groups to use off the shelf technology today to effectively implement MMV plans as well as work with universities, industry and government agencies to develop cutting edge technologies which will further reduce MMV costs and risk in the future.

Alberta Saline Aquifer Project Awards Key Contracts to Launch Carbon Sequestration Pilot in Early 2009

Last update: 11:00 a.m. EDT Sept. 22, 2008
CALGARY, ALBERTA, Sep 22, 2008 (MARKET WIRE via COMTEX) -- Industry, government, and academic participants in the 35-member Alberta Saline Aquifer Project (ASAP) announced today that five companies have been awarded contracts for the engineering, design and environmental-related work that is needed to support the first phase of ASAP's initiative to store carbon dioxide in deep underground saline aquifers.
With this work now underway, the project is on track to complete Phase I - the identification of specific aquifer locations and application for permitting - on schedule by the end of 2008. Pending the receipt of regulatory approvals, the ASAP team anticipates that it will begin Phase II - constructing the pilot project and beginning injections of carbon dioxide - in 2009. Phase III will involve expanding the pilot project to a large-scale, long-term commercial operation.
ASAP, spearheaded by Enbridge Inc., is the largest project of its kind in North America, and will play a major role in advancing industry and government's knowledge of carbon dioxide sequestration. It also clearly demonstrates participants' commitment to addressing the challenges posed by climate change.
"Carbon sequestration technology has the potential to transform the environmental footprint of our energy economy and is one of the most feasible strategies for Canada to reduce its greenhouse gas emissions," said Chuck Szmurlo, Vice-President, Alternative and Emerging Technology, Enbridge Inc., and ASAP project leader. "We're pleased with the progress we've made to date in advancing the ASAP initiative. With the beginning of field studies and engineering, we're a significant step closer to making this project a reality, placing Alberta and the Alberta energy industry in a leadership role in carbon capture and sequestration."
The contracts awarded to date include:
- Norwest Engineering will identify three potential aquifers in Alberta that will meet ASAP's requirements. ConocoPhillips has donated its Athabasca basin data log to assist with this work.
- Schlumberger Carbon Services will develop a detailed base set of measurement, monitoring and verification (MMV) tools and processes for the project. They will build on the work previously donated by BP Canada to define the design and costs associated with drilling the injection and monitoring wells, which includes high-level reservoir injection simulation.
- Colt WorleyParsons will produce a pre-Front End Engineering Design (FEED) study and cost estimate on the compression and pipeline system that will carry the carbon dioxide in liquid form to the sequestration sites. Colt WorleyParsons will also conduct a preliminary study of any health and safety concerns that may affect the public, wildlife or the environment.
- Hatch Energy will design and prepare a cost estimate for the facilities that ASAP will need at the sequestration sites.
- Oxand Canada will develop risk and mitigation strategies associated with compressing, transporting and sequestering carbon dioxide.
Several companies have also donated their time and expertise toward completing Phase I of the project. Computer Modelling Group will conduct a reservoir injection simulation, and Pinnacle Technologies, along with MDA Corporation, will produce a report with recommendations on a suite of measurement, monitoring and verification approaches.
In addition, the ASAP team has submitted an Expression of Interest to the Government of Alberta's $2 billion Climate Change Action Plan announced in July 2008. The Alberta Government will award funds from the $2 billion total to companies or groups involved in accelerating the development of large-scale commercial Carbon Capture & Storage projects in response to climate change.
On July 25, 2008, Natural Resources Canada (NRCAN) asked the ASAP team to submit a full project proposal based on the Expression of Interest that the team had previously submitted for funding in response to the Federal Government's ecoEnergy Technology Initiative. Under the initiative, the Federal Government will invest $230 million in science and technology to accelerate the development and market readiness of technology solutions for clean energy.
About ASAP:
The Alberta Saline Aquifer Project (ASAP) is an industry initiative being led by Enbridge Inc. to identify deep saline aquifers in Alberta that could be used in a carbon sequestration pilot project. As a true collaborative effort, so far 35 organizations are participating in the first phase of the project.

The ASAP participants are:
Alberta Energy Research Institute (AERI)
ATCO Power Canada Ltd.
Athabasca Oil Sands Corporation
BP Canada Energy Company
Cadence Energy Inc.
Canadian Natural Resources
Chevron Canada Resources
Computer Modelling Group
ConocoPhillips Canada
Devon ARL Corporation
Enbridge Inc.
EnCana
EPCOR
GreatPoint Energy Inc.
Hatch Energy
Laricina Energy Ltd.
MEG Energy Corporation
Norwest Corporation
OPTI Canada Inc.
Pembina Pipeline Corporation
Penn West Energy Trust
Petro-Canada
Praxair Canada Inc.
Quadrise Canada Corporation
SAIT Polytechnic
Schlumberger Carbon Services
Shell Canada Limited
StatoilHydro Canada
Swan Hills Synfuels
Teck Cominco Limited
Terralog Technologies
Total E&P Canada
TransCanada
UTS Energy Corporation
WorleyParsons Canada

Electricity prices have to go up to fight CO2: Epcor boss

The Edmonton Journal

Friday, September 05, 2008

EDMONTON - Producing cleaner electricity will cost more, and Canadians will have to foot the bill through higher electricity prices, Epcor's president told the Ontario Energy Network on Thursday in Toronto.

"We can't conserve our way to a zero-emission future," Don Lowry said. "If we want to maximize the role of energy conservation can play, there is one very powerful tool that needs to be used more effectively -- and that's the price signal."

The first step is to stop subsidizing consumer power prices, Lowry said.

In Alberta, household electricity consumption dropped by 10 per cent in 2001 after prices rose in line with a spike in natural gas prices.

Epcor recently signed a licence agreement with Siemens AG to provide gasification technology for a proposed near-zero-emission coal-gasification project at its Genesee generating station west of Edmonton. A $2-billion plant, the first of its kind in the world, could be running by 2015.

For such plans to be affordable, "price hikes are needed to reflect the true cost of electricity and governments need to support early-stage commercialization of emission-reduction technologies like CO2 capture and sequestration," Lowry said.

HTC deal should benefit U of R projects

Bruce Johnstone
Leader-Post

Thursday, September 04, 2008

A Regina-based company has signed a licensing agreement with a Korean boiler manufacturer that will make carbon capture and storage (CCS) technology developed at the University of Regina commercially available to the world power generation market.

The deal, signed Wednesday in Seoul, will also see Doosan Babcock Energy of the U.K. and Doosan Heavy Industries and Construction of South Korea invest $10 million for a 15-per-cent stake in HTC Purenergy.

HTC president and CEO Lionel Kambeitz, who signed the agreement on behalf of the company, said Doosan expects to spend another $10 million to further its own research into CCS technology.

"We're very enthusiastic about the $10-million investment they are making in our company. They are also going to be investing additional money over and above the $10 million ... to improve (CCS) technology," Kambeitz said in a telephone interview from Seoul.

"It allows us to continue to invest in next-generation technology and maintain the technical advantage we think the U of R technology has,'' he said.

The agreement gives Doosan Babcock and Doosan Heavy the right to use CCS technology developed at the U of R's International Test Centre for Carbon Capture through Doosan's 20 commercial offices around the world.

The U of R is considered one of the leading institutions in the area of carbon capture and storage research and applied CCS technology for the power generation industry.

"They build the CCS systems. Upon building them, they then pay a royalty to ourselves and the U of R," he said.

"So it's a 25-year licensing agreement and we're really pleased with what it's going to do for the company and the university. It's pretty exciting times for us.''

Doosan Babcock Energy is one of the largest boiler manufacturers in the world, serving the thermal power, nuclear, and oil and gas and petrochemical industries. Doosan Babcock, which is headquartered in the U.K., has 5,000 employees,

It's parent company, Doosan Heavy Industries, based in South Korea, has 10,000 employees and has completed power projects with more than 150,000 megawatts of installed capacity worldwide.

The $10-million investment also gives Doosan a seat on HTC's board of directors.

But Kambeitz stressed that HTC's local partners, Pinnacle Industrial Services of Regina and NuVision Services of Carseland, Alta., will be able to build smaller-scale CCS systems for the North American market.
© The Leader-Post (Regina) 2008

Companies seek carbon fund cash

From Herald News Services

Wednesday, September 03, 2008

Greenhouse Gases - The Alberta government has received more than a dozen applications from companies vying for a slice of a $2-billion pie set aside to fund large-scale carbon capture and sequestration projects.

The end of the day Tuesday was the deadline for expressions of interest from Alberta companies.

"We're very pleased with the initial response we've had," Energy Department spokesman Jason Chance said late Tuesday.

The government is looking to proposals that have the greatest potential to be built quickly and significantly reduce greenhouse gases, with the hope of reducing emissions by up to five million tonnes annually.

Chance said the government will now narrow down the expressions of interest to a smaller group and ask for more detailed proposals from those finalists.The decision should be made public in early 2009.
© The Calgary Herald 2008

EU coal is safe for now


OXFORD ANALYTICA

Exclusive

September 1, 2008 at 7:48 AM EDT

SUBJECT: The future of coal in the EU.

SIGNIFICANCE: Coal remains an important, if increasingly unloved, part of the EU's energy economy. Its share of the Union's energy needs has declined, being increasingly reduced to a fuel for power generation. Even in this market its position has been eroded and may be put under further pressure by a variety of factors.

ANALYSIS: Coal is unlikely to disappear from the EU's energy balance in the short term, particularly while oil and gas prices are high. Its long-term future depends on the development of an effective carbon capture and storage (CCS) technology. While governments and industry support CCS in principle, they are less willing to provide the necessary funds to demonstrate the technology on a large scale.

Steady decline. In 2006, solid fuels (of which coal is by far the largest component) accounted for just under 18 per cent of EU total energy needs. Of this, around 60 per cent is produced inside the Union, compared with 75 per cent ten years before:

• EU differences. The long-term decline has been strongest in countries such as Belgium and France, where the industry has almost closed, while Germany, Spain, the United Kingdom and Poland (the EU's largest coal producer) retain reduced mining capacity. The industry is characterized by varying degrees of competitiveness – Germany and Spain being the least competitive, while Poland and the United Kingdom can compete internationally.

• Restructuring. The industry is also marked by varying degrees of aid, whether for operational or restructuring purposes. The European Commission has generally approved such aid. The pace of domestic restructuring has increased in recent years, even Germany – traditionally among the least willing to restructure – agreeing to phase out aid over the next decade and in the process allow an ongoing reduction in the output of hard coal.

• Market disconnection. This decline appears to be largely unconnected to changing international market conditions: prices have doubled from 2006 levels thanks to rising prices in the oil and gas markets as well as supply side difficulties in some coal exporting states.

While high prices make the reopening of U.K. mines and the maintenance of output in Poland potentially viable, elsewhere the degree of uncompetitiveness (as well as technical and other difficulties) render a revival unlikely. By contrast, the brown coal sector – which is less energy efficient than steam coal, but less costly to mine and used in mine-mouth power plants – appears to be thriving in countries such as Germany and the Czech Republic.

Power generation. Power generation is an increasingly important part of the coal market, representing more than 80 per cent with the remainder used mainly in steam-raising industrial processes. However, coal's share of the electricity market depends on the relative price and availability of other sources of power generation.

In 2006, coal (hard coal and lignite) accounted for just under 30 per cent of power generated in the EU; sectoral shares varied from none or minimal in France, Sweden, Austria and Belgium, to over 30 per cent in the United Kingdom, around 50 per cent in Germany and over 90 per cent in Poland:

• Maintaining capacity. Though lower than in the past, the figures remain surprisingly robust. Tightening EU rules on emissions and on the age of much coal capacity should have forced a decline in the contribution of coal to power generation. Yet current energy market conditions make the continued use of coal-fired generation attractive enough for utilities even in the longer term. Some major utilities, including Vattenfall, E.On and RWE, are planning new coal plants (partly to replace existing ones) in various parts of Europe, particularly Germany and the United Kingdom.

• Public opposition. Yet, notwithstanding economic conditions and mostly supportive governments, such ambitions face serious public opposition from environmentalists and local groups. Plans for new coal capacity in Germany have faced particular challenges – the issue may yet split the first regional Green-Conservative coalition in Hamburg. In the United Kingdom, environmentalist protests have been intensified against proposed sites, while planned investments in the Netherlands have faced court challenges.

Emissions issues. The main driver of opposition to new coal is its contribution to carbon dioxide (CO2) emissions (a coal-fired station emits almost three times as much as a gas-fired plant). While coal advocates claim that, compared with existing plant, the stations will be more efficient and emit relatively less CO2 per kilowatt-hour produced (and reduce considerably other emissions), critics argue that new coal will lock in electricity systems to high levels of CO2 emissions for another 40 years:

• CCS technologies. Coal's future will depend on the development of effective CSS technologies. Long-term targets, such as the reduction of emissions by 50 per cent by 2050, will be hard to meet without such technology. Moreover, with the high levels of coal use in other parts of the world, EU policy makers have highlighted the importance of demonstrating the technology to bring others into future phases of climate mitigation (and potentially securing a lead in this technology).

• New EU rules? As part of the 2008 energy-climate package, the Commission proposed a directive on the procedures for the geological storage of carbon along with amendments to existing legislation on such issues as environmental impact assessment, pollution control and environmental liability.

The Commission argued this would ensure a high level of environmental integrity for the development of this activity, allow it to operate on a cross-border basis and avoid distortions of the carbon market and of competition more generally. The proposal establishes a framework for permits for exploration and development of sites, while leaving member states with discretion over implementing the framework.

• CCS incentives? The Commission also proposed measures to encourage CCS development, including the establishment of twelve large-scale demonstration sites by 2015 (an objective originally agreed in 2007). A mooted mandatory target that all new plants be equipped with CCS after 2020 was not included as the technology is not yet mature.

Such a view is shared by most member states, but some European parliamentarians are pressing for a greater range of incentives and sanctions to encourage CCS take-up. The parliamentary negotiators have called for an obligation on new plants planned after 2015 to incorporate CCS and for emission credits for CCS plants under the emission trading scheme (ETS) – i.e., more than the currently envisaged ‘zero emission' status which would render CCS competitive with a conventional coal plant paying for emissions permits.

• State aid? There are also numerous calls for direct support to CCS. Many in the electricity industry are concerned that the carbon price will not by itself be enough to boost investment in CCS. Direct subsidies upwards of €1-billion ($1.5-billion U.S.) are seen as necessary to build large-scale demonstration plants, and the Commission has signalled that extensive support will not breach state aid rules.

• EU funding? However, the Commission may be forced to do more than allow governments to provide aid. There is growing pressure for EU-level aid given the apparent unwillingness of most member states to provide sufficient funding. Yet it is not clear where such funds could come from – so far, the EU only envisages 200 million euros for CCS-related research. Proposals to earmark some of the proceeds from ETS auctions are not likely to find favour with governments, many of which regard this as general revenue.

CONCLUSION: The French EU presidency is expected to present a CCS Action Plan in the coming months. However, in the absence of substantial financial support and (politically sensitive) mandatory targets, it will be difficult to boost CCS in the medium term. In the interim, coal will continue to contribute substantially to the EU's energy needs (and its carbon output).

Fairborne signs JV deal with Enhance at Clive oil field

2008-08-27 05:21 MT - News Release

Mr. Steven VanSickle reports

ENHANCE ENERGY INC. AND FAIRBORNE ENERGY LTD. ANNOUNCE JOINT VENTURE OIL RECOVERY PROJECT

Enhance Energy Inc. and Fairborne Energy Ltd. have signed a definitive agreement to develop and implement a CO2-enhanced oil recovery project at the Clive oil field in the Leduc and Nisku reservoirs, subject to the terms and conditions outlined in the agreement.

"We are pleased to be working with Fairborne on this significant development in Clive," said Susan Cole, president of Enhance Energy Inc. "This project will provide an anchor field for our CO2 pipeline project in the central Alberta region and we are excited to be at the forefront of developing infrastructure that will allow us to sequester up to 14 million tonnes of CO2 per year at full capacity."

"It is exciting to witness the advancement of this project," said Steven VanSickle, president and chief executive officer of Fairborne. "This will be a great opportunity for Fairborne, Enhance, the province of Alberta and Canada to demonstrate our abilities to implement a world-scale enhanced recovery project, increasing recovery and the economic life of a mature oil field, and creating jobs in the process."

Additional pipeline and enhanced oil recovery regulatory approvals are still required prior to implementation of this project.

Epcor unveils plans for green power plant

Bill Mah
edmontonjournal.com

Friday, August 15, 2008

EDMONTON - Edmonton-based Epcor unveiled today the technological heart of what it bills as Canada's first near-zero-emission coal-fired power plant.

The City of Edmonton-owned power utility announced a deal with Siemens to have the German company licence its SFG-500 coal gasifier technology to the development of an electricity-generating power plant.

If the project proves feasible, a 270-megawatt generating station using the new technology with greatly reduced emissions would start up in 2015.

The facility would produce only about 15 per cent of the emissions of a conventional coal-burning generation plant, said Epcor senior vice-president David Lewin.

"It would go a long way to meeting the emissions targets set by the governments of both Canada and Alberta," Lewin said.

"This will be the very first time a gasified technology has been used for a full-scale integrated gasification combine-cycle power plant."

Much design and engineering work lies ahead as well as a final tally of costs, regulatory and environmental approvals and a decision to proceed by project investors, Lewin said.

Under the plan, the gasification facility at Genesee, west of Edmonton would convert oxygen, water and coal into syngas - mostly carbon monoxide and hydrogen.

The carbon monoxide is converted to carbon dioxide and more hydrogen. The hydrogen is burned to produce power while the carbon dioxide is captured.

The carbon dioxide could be piped to near-depleted oil wells to recover more oil, or stored underground.

Epcor, Ottawa and Alberta previously kicked in $11 million each to fund a study on generating electricity from gasified coal with greatly reduced emissions.