Recovery And Upgrading Of Bitumen And Heavy Oil In Canada

Abstract

Abstract Impressive advances in technology have enabled the production of a third of Canada's oil requirements from the oil sands and heavy oil deposits mainly located in the province of Alberta. This paper reviews the geological setting of the deposits and the various methods of extracting the bitumen, surfaced mined or in-situ. The principal processes to upgrade the raw bitumen product into a synthetic crude oil for pipelining to refineries is considered. Though many advances have been made, to realize the full potential of these reserves in the face of declining conventional oil supplies, a recommendation is made for an environment supporting a stable sustained effort to continue technological improvement toward developing and upgrading these vast resources. Introduction Canada leads the world in the development of its oil sands and heavy oil resources. About one-third of the country's supply of oil comes from heavy oil deposits and from the oil sands deposits located in the province of Alberta. Production of bitumen surface mined from the Athabasca deposit and upgraded to light sweet synthetic crude oil, provides 35,800 m3 (225,000 barrels) per day or over 15% of the country's petroleum needs. In-situ production of raw bitumen from deep oil sands deposits results in an additional 15,600 m3 (98,000 barrels) per day. These large-scale, technically advanced operations provide a benchmark against which further developments in Canada and elsewhere may be compared. At the same time, while bitumen production is increasing, light oil production in Alberta appears to have peaked. The National Energy Board of Canada has estimated that conventional oil production in Canada will decline by close to 80,000 m3 (half a million barrels) per day over the next decade. Increasingly, the vast Alberta oil sands bitumen reserves will be required to fill the future shortfalls in energy availability. Oil sands, heavy oil and enhanced oil recovery represent the future of the petroleum industry in Alberta to offset the slow decline in conventional oil production (Fig. I). While much research and development is required to improve the technology employed in Canada's oil sands in order to maintain a competitive industry in the future, the industry is operating successfully today. There are two large-scale surface mining operations near Fort McMurray, Alberta, which each have associated upgrading facilities which convert all of their recovered bitumen to a light, low sulphur, residuum free synthetic crude oil. The first of these is operated by Suncor Inc. (formerly Great Canadian Oil Sands Ltd.). But the largest of the operations is the Syncrude joint venture, a surface mining and upgrading complex which has now been in operation for 12 years. Since the year following start-up, the operation has generated a positive cash flow in all years but one while at the same time financing a 50% increase in capacity from cash flow during 1983 to 1988. Over C$1,000 million has been generated as a 50% share of deemed net profit by the operation and paid to the Government of Alberta in place of resource royalty.