Heavy Oil Transportation - Present And Future

Abstract

Abstract This paper discusses heavy oil transportation systems, and in particular the systems serving Saskatchewan heavy oil production areas. It discusses the problems facing the industry in transportation and marketing of heavy oil, and alternatives currently available to deal with them. The paper also discusses how the Interprovincial pipeline system fitsinto the over-all transportation picture and the influences it currently has on heavy oil transportation. Condensate shortages are going to have a significant impact on the transportation of heavy oil. Methods of dealing with this problem are evolving and include the use of other diluents, upgrading of the crude prior to transportation and the use of other types of pipeline systems such as hot oil pipelines and emulsion carrying systems. This paper evaluates these methods, the advantages and disadvantages of each, and how they might fit into the future for heavy oil transportation. Introduction Heavy oil production is becoming an increasingly important part of Canada's total oil production capability. For many years, while light sweet crude was in adequate supply, heavy oil was having a difficult time finding its place in the market. However, it has become more evident in the last dozen years that domestically-produced light crude will not keep up with Canada's needs, and as it declines, their needs will have 10 be met either through greater dependence on foreign crude, more rapid development of Canada's other crude resources namely offshore and oil sands, or increased emphasis on heavy crude and bitumen resources. While all of these resource alternatives will play a part ill filling the void left by declining domestic light oil supplies, heavy oil in the 12 ° to 25 ° API gravity range and "extra heavy crude" or bitumen in the 8 ° to 12 ° API range will playa major and immediate role. Technology is in place to produce these crudes in relatively large quantities aL a cost currently feasible in today's fiscal and economic conditions. However, the problems which are developing are in the ability to move the larger forecasted volumes to market. Current Heavy Oil Pipeline Systems Figure 1 shows a map of the heavy oil and bitumen producing areas of Saskatchewan and Alberta. There are massive reserves of heavy crude and bitumens which are recoverable with oil-in-place totalling into billion of cubic metres. Figure 1 shows that a significant area for heavy crude is along the Saskatchewan/ Alberta boundary, generally centred in the Cold Lake and Lloydminster areas, but actually starting north of Cold Lake with bitumen deposits and stretching almost to the U.S. border. This area probably holds the greatest promise in heavy oil development, and will undoubtedly be tbe main area for heavy oil and bitumen production over the next 20 years. Figure 1 also shows the transportation systems currently servicing the area, The pipeline systems farthest south, the South Saskatchewan, and the Mid-Saskatchewan systems and BP's Chauvin pipeline system generally handle lighter crudes between 18 ° and 25 ° API and require very little diluent to support their movement.