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Providing coverage of Alaska and northern Canada's oil and gas industry
October 2014

Vol. 19, No. 41 Week of October 12, 2014

To capture or not

Neighboring Canadian provinces take different view of whether CCS is route to cleaner atmosphere or just a ‘science experiment’

Gary Park

For Petroleum News

Alberta and Saskatchewan agree on almost all major issues of energy policy, with the one exception of carbon capture and storage, CCS, to eliminate greenhouse gas emissions from the atmosphere.

Alberta’s newly installed Premier Jim Prentice, who was a former Canadian government environment minister, discusses CCS as a “science experiment” that has failed to yield its promised results, while his Saskatchewan counterpart Brad Wall rates CCS as a chance for his province to set an example for the rest of the world.

SaskPower took a bold stride forward Oct. 2 by opening the world’s first commercial-scale CCS plant, equipped with carbon capture and storage technology, with the prospect of generating global investment opportunities for the government-owned utility.

“This project is another Saskatchewan first,” Wall said, referring to a province that pioneered radiation technology and the debit card. “The rest of the world is very interested to learn how they, too, can produce environmentally sustainable coal power.”

Backing his claims, more than 250 people from 20 different countries attended the launch of the C$1.4 billion Boundary Creek project (including C$240 million in federal subsidies) which is designed to remove 1 million metric tons a year of carbon dioxide, while producing 110 megawatts of electricity to power 100,000 households.

SaskPower said it has known for more than a month that the technology works.

“We knew it would, we just didn’t know exactly when it would work,” said Mike Monea, SaskPower’s president of CCS initiatives.

Prentice a skeptic

While the Saskatchewan government was reveling in its breakthrough, Prentice has listed himself among the skeptics.

During his campaign to become leader of Alberta’s governing Conservative Party he vowed to scrap his province’s subsidization of CCS projects, arguing Alberta has been “off its game” for years when it comes to climate change policy.

He gained support from Alberta Auditor-General Marwan Saher who issued a blistering report that found Alberta’s climate change plan - heavily tied to CCS - had missed its greenhouse gas reduction targets, failed to monitor the plan’s results and has yet to publish a single document on the outcomes.

The report noted that CCS projects are expected to contribute only 10 percent of the reductions originally targeted in 2008, despite more than C$1 billion committed by the province to schemes to capture carbon and use some in enhanced oil recovery projects.

Prentice said he intends to cut off CCS investments. “It’s not a panacea, it’s a science experiment,” he said, but added the idea should not altogether be abandoned.

Wall takes a sharply different view, especially when it comes to Saskatchewan marketing its CCS technology.

He said that, despite the push in North America to eliminate coal-fired plants and move to either natural gas or nuclear power as the fuel source to meet power demands, 1,200 coal plants are being planned worldwide, more than 75 percent of them in China which has 4,500 megawatts of generation in the works.

Because it tends to be located in politically stable areas of the world, unlike oil or natural gas, coal production shows every sign of thriving, which Wall believes increases the pressure to advance CCS technology.

Majors committed

There is no shortage of Canadian oil and gas producing majors who are committed to the initiative.

Cenovus Energy has for years been using carbon dioxide piped from North Dakota to boost production from its aging oilfield at Weyburn, Saskatchewan, while scientists from around the world are studying the project to determine whether the gas remains sequestered.

Shell Canada expects to start operating a CCS facility at its Scotford crude bitumen upgrader near Edmonton next year.

The company’s Cansolv subsidiary has provided the technology to capture both carbon dioxide and sulphur dioxide.

Shell said it believes the venture will help prove the economic viability of the technology and pave the way for future projects.

Marc Jaccard, an energy economist at Vancouver’s Simon Fraser University, said that when the world gets serious about reducing carbon emissions, “fossil-fuel-endowed regions” are likely to pursue CCS along with different renewables.

But he said those regions are unlikely to simply stop producing fossil fuel. Instead they may decide that regardless of the extra cost CCS may be the cheapest way to get dependable energy.

Sierra Club Canada director John Bennett said the Saskatchewan project is a “waste of vital capital that should be invested in conservation, efficiency and renewable energy.”

“It doesn’t get us off fossil fuels,” he said.






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