February 05, 2010

Picture above is Lee Richardson, MP with Alberta’s Minister of Environment Rob Renner


Calgary - University of Calgary researchers moved closer today toward transforming Alberta’s oil sands industry by greatly reducing its environment footprint, with a new research facility that opened on campus.

The ‘In Situ Energy Centre’s’ new facility will enable researchers to test projects aimed at more cleanly and cost-effectively unlocking energy from Alberta’s vast oil sands resources that are too deep to be mined from the surface.

“Our research is focused on reducing the environmental footprint of oil sands production by enhancing the upgrading of bitumen directly in the reservoir,” said Pedro Pereira Almao, professor in the Schulich School of Engineering and director of the In Situ Energy Centre.

“This next-generation technology, called in situ upgrading, will significantly reduce the consumption of natural gas, the emissions from burning this gas, and the fresh water used by existing oil sands recovery and production technologies,” he said.

Lee Richardson, MP for Calgary Centre representing the federal government, and Alberta Environment Minister Rob Renner joined U of C executive, researchers and invited guests in officially opening the new facility, located in an expansion on the northwest corner of the Schulich School.

“Science and technology will be key as we move forward to reducing our greenhouse gas emissions,” said Jim Prentice, federal Minister of the Environment. “I congratulate the University of Calgary on this new facility, which will enable researchers to focus on next-generation technology aimed at reducing Alberta’s oilsands environmental footprint.”
 
“Cleaner energy development is no longer an option – it’s a necessity,” said Rob Renner, Minister of Alberta Environment. “This new research facility will help to advance Alberta’s ongoing role as a responsible global energy supplier.”

The U of C, through a joint initiative led by the Institute for Sustainable Energy, Environment and Economy (ISEEE) and the Schulich School of Engineering, received more than $9.3 million from the Canadian Foundation for Innovation for the new multidisciplinary research facility.

The In Situ Energy Centre has also received significant funding from the provincial government, through Alberta Innovates, and from ISEEE.

“These expanded research facilities will enhance the work of our researchers from a variety of disciplines who are working on some of society’s most pressing problems related to energy and the environment,” said Warren Veale, Interim President of the University of Calgary. “These research projects are collaborations between researchers, government and industry that aim to provide real-world solutions to issues like climate change.”

Pereira Almao leads a team of U of C engineers, geoscientists and chemists working to upgrade tar-like bitumen into higher-quality heavy oil directly in the underground reservoir, which would significantly reduce the upgrading required when the bitumen is pumped to the surface. The ultimate goal is to virtually eliminate the use of natural gas and fresh water in the bitumen extraction and upgrading processes.

“We are known as the green engineering school in the heart of the oil patch, because of this kind of research leadership,” said Elizabeth Cannon, Dean of the Schulich School of Engineering. “We are strong by any global standard in chemical and petroleum research, and the imperative now is to help energy companies find solutions that reduce the impact of the oil sands on the environment.”

“This new facility will help an innovative group of researchers get closer to the ‘holy grail’ of oil sands energy development: the cost-effective recovery of energy from oil sands with a fraction of the environmental footprint,” said David Layzell, ISEEE’s Executive Director and Chair of the management board for the In Situ Energy Centre.

In addition to federal and provincial funding, the U of C’s in situ upgrading research program has attracted support from industry, including Shell Canada, Total Canada, Nexen Inc., Repsol and ConocoPhillps.


The following are remarks made by MP Lee Richardson at the announcement of funding for the Schulich School of Engineering

“Thank you Elizabeth (Cannon) for that introduction.  I must first make note that Minister Ablonczy would like to have been with you today, but was called back to Ottawa.

It is a great pleasure to be here with President Warren Veale and with my provincial colleague, the Honourable Rob Renner, Minister of the Environment on this momentous occasion here at the University.

We are here today to celebrate the opening of a new research facility aimed to transform the oil-sands industry and I am very pleased to see the Schulich School of Engineering, right here in Calgary, take a leadership role as the green engineering school. 

The Oil Sands are one of Canada's greatest resource endowments and developed responsibly, they hold the promise to be a driving engine of the Canadian economy, ensuring prosperity and a high quality of life for future generations.

But, the oils sands must be developed in an environmentally responsible manner ensuring that Canada becomes a “clean energy superpower.”  We aspire to be a respected and environmentally responsible producer of all forms of energy, whether renewables such as hydro, or non-renewables such as the oil sands; and science and technology will play a key role as we move forward to reducing our greenhouse gas emissions.

Today you are opening doors to not only a new facility, but to a cleaner way of unlocking energy from our vast oil sands resources.  It will become a centre where researches from many parts of the world can come together with industry and other partners in developing more cost-effective and environmentally sustainable processes for in situ recovery. 

This centre was made possible due to the partnerships and the collaborative effort of those here in this room.  The investments made today in environmental technology will ensure Canada continues to be a leader in environmental stewardship.
And, we must continue to work with all levels of government, industry and researchers as we move towards clean energy development.  It is with these partnerships that we will make a difference in reducing our environmental footprint.

As I come to a close, I would like to thank Minister Renner and the provincial government for your contributions to cleaner energy development and thank you to the University of Calgary and the Schulich School of Engineering for your forward thinking approach to the development of this facility.
On behalf of the federal government and our Prime Minister, Stephen Harper, I congratulate the University on this new facility.  This centre will not only enable researchers to focus on next-generation technology, but will be a leading way forward to a ‘Clean Energy Superpower’.”



BACKGROUNDER:


Development of in situ oil sands resources represents the future of Alberta’s oil sands industry.

More than 90 per cent of the estimated 175 billion barrels of proven oil reserves in the province’s oil sands consist of so-called in situ (“in place”) bitumen deposits too deep to be mined from the surface.

However, existing technologies to first extract and then upgrade this bitumen are not economically or environmentally sustainable over the long term. The extraction process requires too much energy and water.

The most commonly used process, Steam Assisted Gravity Drainage (SAGD), consumes huge amounts of natural gas and water, to make steam that’s injected into the reservoir to loosen the tar-like bitumen so it flows to production wells.

Current technologies must be improved. If they’re not, by 2020, they’re expected to consume enough natural gas every day to heat six million Canadian homes.

Alberta’s oil sands industry also is among Canada’s fastest rising sources of greenhouse gas emissions – which contribute to global warming and climate change – and this trend will continue with oil sands expansion unless cleaner technologies are developed.

On top of that, Alberta exports most of its ‘raw’ bitumen to U.S. refineries for upgrading. Research shows that only 13 per cent of in situ oil sands production is expected to be processed in the province in 2020.

There is a substantial loss of value-added product to Canada when bitumen is exported rather than synthetic oil because of the price difference in the two products, according to a study by the Canadian Energy Research Institute.

Being able to upgrade 50 per cent of the bitumen in situ in Alberta, rather than pipelining it to U.S. refineries for upgrading, would generate $37 billion in revenue (at 2004 world oil prices). Fifteen per cent of oil revenue flows to the federal (which receives 41 per cent of this share) and Alberta governments.

In situ upgrading would also improve oil recovery rates. Even a one percentage point increase in recovery would amount to an additional 2.4 billion cubic metres of oil – enough to meet Canadian demand for more than 23 years at 2004 oil consumption rates.

A key to success of the in situ upgrading process being developed at the University of Calgary’s In Situ Research Centre is injecting a chemical catalyst, in the form of nano-sized particles, into the reservoir and ensuring this nano-catalyst is thoroughly dispersed into complex oil sands deposits. In essence, the process enables the extraction and partial upgrading of the bitumen to take place underground.

The In Situ Energy Centre’s new facility consists of nine ‘mini-refineries’ and other refinery components. These laboratory bench-scale pilot units will enable Pedro Pereira Almao and his team to test and optimize the best catalyst and upgrading process, in terms of efficient bitumen recovery, cost-effectiveness and environmental impact.

State-of-the-art instruments (including a nuclear magnetic resonance imaging machine and mass spectrometers) will be used to characterize the makeup of bitumen mixtures and develop a ‘next-generation’ reservoir simulator in which to test nano-catalysts with several different upgrading processes.

“The next-generation simulator will integrate the in situ upgrading process with geo mechanics and reservoir simulation,” Pereira Almao said. “Together, this infrastructure will create a world-class facility for bitumen and reservoir characterization.”