september 2009 issue
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Doing Business
Successful Bidders Announced For Carbon Project Funding
BY NORDAHL FLAKSTAD
Freelance Writer
The Alberta Government has announced three successful bidders to share $2 billion in funding for carbon capture and storage projects.
The government has budgeted up to $100 million in the current fiscal year for engineering and design work on the successful projects. The first round of commercial scale projects is expected to achieve annual carbon dioxide reductions of five megatonnes by 2015.
Selected from 11 finalists are
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Enhance Energy Inc. for the Alberta Carbon Trunk Line, to incorporate gasification, CO2 capture, transportation, enhanced oil recovery and storage in the Alberta Industrial Heartland and Central Alberta. It will capture CO2 from the Agrium Inc. fertilizer plant and the Northwest Upgrader.
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EPCOR/Enbridge for an integrated gasification combined-cycle carbon capture power generation facility adjacent to EPCOR’S existing Genesee power plant, west of Edmonton.
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Shell Canada Energy/Chevron Canada Ltd./ Marathon Oil Sands LP for a fully integrated carbon capture and storage project at the Scotford Upgrader in the Alberta Industrial Heartland.
Infrastructure Stimulus
On Alberta Projects
Exceeds Half Billion
Spending plans by the federal and Alberta governments under the Infrastructure Stimulus Fund total $443 million and involve 156 projects across the province. When municipal and other contributions are included, the total investment in local Alberta infrastructure improvements exceeds $550 million.
Projects being funded will improve road
safety and durability, and enhance wastewater treatment and drinking water quality.
Stantec and Chevron Sign
Multi-Year Service Contract
Stantec has been awarded a global, multi-year, preferred supplier contract to provide environmental assessment and remediation services for Chevron Corp. The contract will focus on environmental, social, and health impact assessments; environmental remediation; and operational excellence compliance auditing.
Stantec will begin work under the contract immediately at sites throughout North America, South America, Asia Pacific, the Middle East and Russia.
SNC-Lavalin Hired For
Saudi-Egyptian Power Link
SNC-Lavalin’s Transmission and
Distribution Group has received a consulting contract for an electrical connection between Egypt and Saudi Arabia.
The contract for the high-voltage, direct current project includes the route selection for a proposed 1,500-kilometre, 500-kV, multi-terminal link, plus system and design studies, and the preparation of a request for proposal for the stations and lines in both countries.
SNC-Lavalin is completing a similar project connecting Kuwait, Saudi Arabia, Bahrain, Qatar and the United Arab Emirates.
Reports Share Optimism
About Future of Oilsands
An Energy Resources Conservation Board publication forecasts Alberta’s annual bitumen production will increase to more than one billion barrels, or three million barrels per day, by 2018.
Alberta’s Reserves 2008 and Supply/Demand Outlook 2009-2018 places Alberta’s total remaining established bitumen and conventional oil reserves at 171.9 billion barrels, consisting of 170.4 billion barrels of bitumen and 1.5 billion barrels of conventional.
In 2008, bitumen production of 477 million barrels (averaging 1.31 million bbl/d) amounted to a decrease of one per cent from 2007. Conventional oil production last year was 184 million barrels, or 502,800 bbl/d, a decrease of 3.8 per cent from 2007.
The ERCB also reports that
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remaining established marketable conventional gas reserves were 39 trillion cubic feet
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remaining established coalbed methane gas reserves were one trillion cubic feet
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remaining established coal reserves were 37 billion tons.
Meanwhile, the Canadian Association of Petroleum Producers’ 2009-2025 Canadian Crude Oil Forecast and Market Outlook suggests overall Canadian oil production could reach 4.2 million bbl/d by 2025, versus the current 2.7 million bbl/d.
The Paris-based International Energy Agency’s medium-term market outlook also provides sanguine forecasts for Canada’s oilsands. “Even with a potential for sustained lower prices, and possible environmental considerations, the oilsands benefit from the sheer size of the resource, the benign investment environment and the proximity of U.S. markets.”
TransCanada Becomes Sole Owner Of Keystone Lines
TransCanada Corp. now owns all of the Keystone Pipeline System, which will be among North America’s largest oil delivery systems. The company acquired ConocoPhillips’ remaining interest in a project that will have the capacity to move 1.1 million bbl/d.
Keystone’s first phase, currently under construction, will extend 3,456 km from Hardisty, Alta., to the U.S. Midwest. This segment, with a 435,000 bbl/d capacity, is expected to be in commercial operation in early 2010. The line will later expand to a capacity of 590,000 bbl/d and be extended to Cushing, Okla., in late 2010.
Keystone is also seeking regulatory approvals in Canada and the U.S. to construct and operate an expansion and extension of the pipeline system to provide additional capacity of 500,000 bbl/d from Western Canada to the U.S. Gulf Coast in 2012.
Keystone’s total capital cost is expected to be about US $12 billion, of which some $2.7 billion has been spent so far.
Province Prepares to Take
In-Kind Bitumen Royalties
In a bid to reenergize the stalled Northwest Upgrader near Fort Saskatchewan, Alberta Energy has announced it will take bitumen royalties in-kind. The provincial department has issued a request for proposal for upgrading of the resulting bitumen.
The province intends turn its portion over to a company on a commercial basis with an agreed-upon amount of up to 75,000 bbl/d. The guaranteed bitumen supply is seen as a possible way to get the project back on track.
Niko Resources Named
Operator For Caribbean Play
Under an agreement with a major British natural-gas producer, Niko Resources Ltd. of Calgary will operate a recently awarded shallow-water block off Trinidad and Tobago.
Ownership in the block is shared between another Calgary-based company, Voyager Energy Ltd., Centrica PLC of the U.K., and Trinidad and Tobago’s state-owned Petrotrin.
North American & Shell
Sign Mine Agreement
North American Energy Partners Inc. has signed a three-year earthmoving and mine support services agreement with Shell Canada Energy. The contract covers the provision of recurring services including construction, earthmoving and mine support at Albian Sands’ Muskeg River Mine and Jackpine Mine oilsands projects near Fort McMurray.
Enbridge Will Carry
Kearl Production South
Enbridge Inc., through an agreement with Imperial Oil Resources Ventures Ltd. and ExxonMobil Canada Properties, will provide pipeline transportation of blended bitumen to Edmonton from the planned Kearl oilsands project in northeastern Alberta.
Kearl’s bitumen output is expected to average about 300,000 bbl/d. This will likely involve start-up of an initial mine development in 2012 with a capacity of about 100,000 bbl/d. It would be followed by two additional phases each producing about 100,000 bbl/d, and peak production of up to 345,000 bbl/d.
AERI Study Compares Outputs
Of Greenhouse Gases
Research funded by the Alberta Energy Research Institute shows that direct greenhouse gas emissions from Alberta’s oilsands generally are about 10 per cent higher than those from other crudes in the U.S. If cogeneration is taken into consideration, oilsands crudes would be similar to conventional crudes, when it comes to the emissions.
The report, Life-Cycle Analysis of North American and Imported Crude Oils, is based on two independent studies. It’s described as “the first robust comparison of domestic, imported and oilsands crude processes in U.S. refineries.”
The research, conducted over the past year by U.S.-based consulting companies Jacobs Consultancy and TIAX LLC.