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New Process Could Make Canadian Oil Cheaper, Cleaner

A method for getting oil out of tarry sands could reduce the costs and lower the greenhouse-gas emissions associated with its extraction.
August 3, 2011

New technology for extracting oil from oil sands could more than double the amount of oil that can be extracted from these abundant deposits. It could also reduce greenhouse-gas emissions from the process by up to 85 percent. The technology was developed by N-Solv, an Alberta-based consortium that recently received $10 million from the Canadian government to develop the technology.

Oil cleanup: A solvent allows oil to flow out of the sand at the top of this simulated oil sands reservoir.

Canada’s oil sands are a huge resource. They contain enough oil to supply the U.S. for decades. But they are made up of a tarry substance called bitumen, which requires large amounts of energy to extract from the ground and prepare for transport to a refinery. This fact has raised concerns about the impact of oil sands on climate change. The concerns have been heightened by plans to build a new pipeline for transporting crude oil from the sands to refineries in the United States.

Most oil sands production currently involves digging up oily sand deposits near the surface and processing the sludgy material with heat and chemicals to free the oil and reduce its viscosity so it can flow through a pipeline. But 80 percent of oil sands are too deep for this approach. Getting at the deeper oil requires treating the bitumen underground so it can be pumped out through an oil well. The most common technique in new projects involves injecting the bitumen with steam underground. But producing the steam means burning natural gas, which emits carbon dioxide. And the oil that’s pumped out is still too thick to flow through a pipeline, so it has to be partially refined, which emits still more greenhouse gases.

N-Solv’s process requires less energy because it uses a solvent rather than steam to free the oil, says Murray Smith, a member of N-Solv’s board of directors. The solvent, such as propane, is heated to a relatively low temperature (about 50 °C) and injected into a bitumen deposit. The solvent breaks down the bitumen, allowing it to be pumped out along with the propane, which can be reused. The solvent approach requires less energy than heating, pumping, and recycling water for steam. And because the heaviest components of the bitumen remain underground, the oil that results from the solvent process needs to be refined less before it can be transported in a pipeline.

Because the new process requires less energy, it should also be cheaper. Smith adds that the equipment needed for heating and reusing the propane is less expensive than technology for managing the large volumes of water used in the steam process. With conventional techniques, oil prices have to be above $50 to $60 per barrel—as they have been for several years—for oil sands to be economical. Smith says that with the solvent process, oil sands are still economical even if oil is $30 to $40 per barrel, close to what it was in the 1990s and early 2000s (in inflation-adjusted dollars). N-Solv says the lower costs will make it possible to economically extract more than twice as much oil from the oil sands compared to conventional technologies.

The idea of using solvents to get at oil sands was proposed in the 1970s, but early experiments showed that the process couldn’t produce oil quickly enough. Two things changed that, according to N-Solv. First, horizontal drilling technologies now make it possible to run a solvent injection well along the length of an oil sands deposit, increasing the area in contact with the solvent, thus increasing production. Second, N-Solv determined that even small amounts of methane—a by-product of using a solvent—could contaminate the propane and degrade its performance. So N-Solv introduced purification equipment to separate methane from the propane before it is reused. The separated methane can also be used to heat the propane, further reducing energy costs.

Although N-Solv’s technology could reduce carbon-dioxide emissions from production, most of the emissions associated with oil sands—as with any source of oil—come not from producing the oil, but from burning it in vehicles and furnaces. The technology’s impact on climate change will depend on whether the process leads to increased oil production—if it does, it may actually result in increased net greenhouse-gas emissions, says David Keith, a chemical and petroleum engineering professor at the University of Calgary.

So far, the process has been tested only in a lab. Now N-Solv will begin a pilot project that could produce 500 barrels of oil a day. The $60 million project, which is mostly funded by private sources, will determine whether the process can work on a larger scale.

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