One Stop Shopping For CO2 

“We think it’s sort of a vector for the future. All of this stuff has been done before, but not all together in one place.” - Ian MacGregor, North West Upgrading

North West Updgrading is planning to keep 3.6 million tonnes of carbon dioxide out of the atmosphere over three phases. The company is a 50% stakeholder in the North West Redwater Partnership (NWR), whose bitumen refinery will instead use the CO2 to help recover more than a billion barrels of oil in Alberta.

The Partnership is planning to build a bitumen refinery north-east of Edmonton that it says will reduce emissions – as much as removing 300,000 cars off the road in each of the three phases – and help the oil and gas industry better manage its CO2 emissions.

Components for the very large hydrocracking vessels are unloaded
North West Upgrading hydrocracking vessels being unloaded Components for the very large hydrocracking vessels
are unloaded. The parts are so large and specialized,
they're made in only two places in he world and
take several years to be assembled.

“We think it’s sort of a vector for the future,” says the chairman of North West Upgrading, Ian MacGregor. “All of this stuff has been done before, but not all together in one place.”

The Partnership will upgrade and refine the bitumen into diesel fuel and other products at one location, in pretty much one step. “You add hydrogen to the heavy oil and when you add enough, it turns into fuel,” explains MacGregor. “You can either add all the hydrogen in one place, like us, or you can add it in intermediate places to make synthetic crude oil and then move that synthetic crude oil somewhere else, where they add hydrogen.”

NWR gasification process – essentially burning the heavy bottom of the bitumen barrel with pure oxygen – produces the hydrogen needed to turn bitumen into fuel. It also produces massive amounts of pure CO2. The greenhouse gas is undesirable when released into the atmosphere, but it’s a valuable product for getting oil out of mature reservoirs, a process called enhanced oil recovery (EOR).

“Think of an old paint tin in your garage, with about 40 per cent of the paint in there but it’s all dried up,” explains MacGregor. “If you take that and put CO2 in it, it’s like putting solvent in the paint tin. You slosh it around and it makes the oil less viscous and more mobile in the formation, so you can get 15 to 20 per cent of the original oil in place out.”

The CO2 used in EOR stays in the reservoir. MacGregor says Alberta doesn’t have a sufficient supply of pure CO2 that’s needed for economical EOR. You can produce pure CO2 by making hydrogen from natural gas, but typically its contaminated with nitrogen and it’s very expensive to purify it so it can be used for EOR.

NWR will capture its CO2 and supply it to an independent company, Enhance Energy Inc. Enhance plans to use the CO2 in its own EOR projects as well as distribute it to EOR customers by building the province’s first CO2 pipeline system. The CO2 will remain in EOR reservoirs, where it will stay safely stored.

“It’s the greatest opportunity of my life,” says MacGregor, a 35-year veteran of the oil and gas industry. “It’s just a great place to do this, we’ve got the reservoirs, we’ve got the CO2 sources. Sure there are problems, but that’s where opportunities are made.”

If all goes as planned, and pending approvals, MacGregor says the NWR bitument refinery could be up and running by 2014.