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Activists seize oil sands spotlight
Gary Park For Petroleum News
That rumbling sound in northern Alberta comes from the oil sands, where even a lull in the once-frenetic rate of growth does not mean a total time out.
Far from it.
Greenpeace activists invaded Suncor Energy’s operations Sept. 30 and brought conveyor belts carrying raw bitumen to a halt.
Three days later more protesters from the same organization breached the security perimeter at Shell Canada’s processing plant near Edmonton.
In mid-September, Greenpeace members chained themselves to a mine shovel and dump truck at Shell’s mine, temporarily bringing production to a halt.
Entry to the Suncor property was made from canoes on an adjacent river; 23 protesters entered the Suncor property and 11 chained themselves to four conveyor belts before being removed by the Royal Canadian Mounted Police.
Greenpeace Executive Director Bruce Cox said the actions — which have also extended to a Total refinery in France — were designed to draw attention to the “global addiction to dirty oil” and to prompt world leaders to take action on climate change at the United Nations conference in Copenhagen in December.
He said the activists were fully aware they could be arrested for their participation in the events, but insisted Greenpeace would not put the safety of Suncor workers at risk.
Suncor files suit Suncor has filed a C$1.5 million lawsuit against Greenpeace, based on a preliminary estimate of the value of lost production, and is continuing to review “what the total damages may be in relation to the civil claim,” said a spokeswoman.
Shell said it is stepping up security at the refinery site through “increased resources and entry controls and tightened boundaries,” a spokesman said.
Alberta Premier Ed Stelmach promised to use the “force of the law to deal with these people.” Greenpeace in turn accused Stelmach of using his political influence to undermine the judicial system.
The protests were bolstered by a study produced by Global Forest Watch Canada, with financial help from Greenpeace, claiming that companies and governments do not include the impact on greenhouse gas emissions from the disturbance and destruction of the boreal forest to clear land for oil sands mines.
The study said the annual average release of carbon from the removal of ecosystems would be 8.7 million metric tons of carbon dioxide, compared with 3.6 million metric tons of current emissions.
Greenpeace said the peatlands in the oil sands region are the “world’s most important storehouses of soil carbon.”
Nuclear called viable Other oil sands developments over the past two weeks include:
• A study by the Petroleum Technology Alliance Canada said nuclear power is a viable alternative to natural gas to meet the sector’s energy needs, but going nuclear is unlikely to happen before 2025 because of the challenges posed.
The Calgary-based research group said existing technology is unable to produce the required pressurized steam for in-situ development, while high costs, a lack of commercial development or regulatory approvals make it unlikely that emerging options will be available for at least a decade.
The study said nuclear power, which could replace natural gas-fired plants to make hydrogen for heavy oil upgraders, would also produce excess energy for delivery to Alberta’s electricity grid.
A second-phase research study is expected to take 18 months, while the Alberta government is consulting with the public on the sensitive issue of developing nuclear power before releasing a policy either late this year or in 2010.
• Jean-Michel Gires, the newly appointed chief executive officer of Total’s Canadian unit, said the French oil major will delay until late 2011 final sanctioning of its Joslyn project until oil prices reach US$80-$85 a barrel.
He said current prices do not justify Total’s goal of producing 200,000 barrels per day from two equal-sized oil sands mining phases. The first stage was last estimated to cost C$9 billion.
Gires said initial production is not now expected before 2016-18, well behind the original startup date of 2012.
• Marvin Romanow, chief executive officer of Nexen, predicted Alberta oil sands production will almost triple to 3 million barrels per day, but he won’t set a target date.
He was also unwilling to set a timeline for the second, 70,000 bpd phase of Nexen’s Long Lake project until the first phase is ramped up, carbon emission rules are set for North America and a more robust economy is in place.
Romanow said one of every 83 barrels of oil produced in the world now comes from the oil sands and he is certain that share will increase because cheap, easy-to-find energy is in decline.
Daniel: oil sands not dead • Enbridge chief executive officer Pat Daniel said the oil sands still offer significant new opportunities in regional pipelines and market extensions.
He said the resource is “anything but dead” despite concerns about “dirty” oil and environmental issues.
Daniel said that in approving Enbridge’s Alberta Clipper pipeline, United States regulators “indicated security of supply to the U.S. is so critically important that the oil sands must be developed and oil sands production will flow to the U.S.”
His view came on the heels of a report by the Consumer Energy Alliance, a U.S.-based nonprofit group, which is lobbying U.S. government officials to embrace oil sands-derived crude as a safe and secure source of imported energy.
In the process it is urging U.S. national security officials to weigh the risks if the U.S. adopts a nationwide low-carbon fuel standard which could compromise oil sands shipments from Canada.
• Southern Pacific Resource is acquiring heavy oil production of 6,000 bpd in southwestern Saskatchewan for C$90 million.
Although the seller was not identified, EnCana placed one operation in the region on the auction block in late 2008.
The assets have a remaining operating life estimated at 15 years and will generate cash flow for the company to pursue its STP-McKay oil sands project in Alberta, which is designed to recover 12,000 bpd (9,600 bpd net to Southern Pacific).
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