Gasification Process Reduces Operating Costs For Oil Sands Producers

One of the challenges in converting the Northern Alberta oil sands into usable energy is the tremendous amounts of natural gas consumed in the process. The supply and cost of this resource is a major cost factor for Oil Sands producers.

OPTI Canada and Nexen are the first to introduce large-scale gasification into the bitumen upgrading process in the Long Lake project. This process uses the Shell Gasification Process (SGP) processes which takes the liquid asphaltenes from OPTI’s OrCrude process and produces hydrogen for the distillate hydrocracking process, synthetic gas for the bitumen recovery process and fuel for power and steam generation.

The economic benefit of this process is well described in a 2004 paper, Gasification in the Canadian Oil Sands: The Long Lake Integrated Upgrading Project:

The energy balance of the project… demonstrates the elimination of virtually all of the natural gas cost exposure, which results in an operating cost advantage of about 50% over currently-configured operations.

Stephen Krause, a specialist in Emerson’s Hydrocarbon and Energy Industry center based in Calgary is involved in the project engineering on this large, complex first-of-its-kind project. Much like processes found in other industries like refining, Stephen told me that gasification is an extremely complex process that requires extensive safety design to mitigate risks. I highlighted some of these safety design challenges in an earlier post. Some of the goals with respect to safety, automation and modular aspects of this project are described here.

Other Oil Sands producers are watching this project unfold as they consider including gasification as part of their upgrader project. And, the experience gained by Stephen and the Emerson project team will greatly help these producers as the future projects unfold.

Posted Wednesday, June 27th, 2007 under Oil & Gas, Services, Consulting & Training.

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