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Suncor Board Approves C$20.6B Oil Sands Expansion
31 January 2008
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| The diagram depicts the assets of the 200,000 bpd “Voyageur” expansion program; however, Voyageur will be operated on an integrated basis with existing operations. Click to enlarge. |
The Board of Directors of Suncor Energy gave final approval to a C$20.6 billion (US$20.7 billion) investment to boost crude oil production at the company’s oil sands operation, located north of Fort McMurray, Alberta, Canada, by 200,000 barrels per day (bpd) over its planned 2008 levels to reach 550,000 bpd in 2012.
The expansion plans include constructing four additional stages of in-situ bitumen production, a new upgrader (Suncor’s third) to convert that bitumen into higher-value crude oil, and various infrastructure and utilities.
An investment of approximately $9 billion (with an estimate accuracy range of +16%/-13%) is to be made to construct the four stages of in-situ production. Each stage is expected to produce an average of approximately 68,000 bpd of bitumen. (Depending on certain operational and market conditions, excess bitumen may be sold to market as a heavy crude blend.)
An investment of approximately $11.6 billion (with an estimate accuracy range of +12%/-8%) will go towards construction of an upgrader designed to process 245,000 bpd of bitumen into 200,000 bpd of crude oil. The product slate is expected to consist of approximately 85% sweet crude oil and diesel, and 15% sour crude oil. Oil products are planned to be shipped to market through third-party and Suncor-owned pipelines.
The expansion puts in-situ production on more of an equal footing with Suncor’s historical reliance on oil sands mining. Of the estimated total of $20.6 billion, Suncor has already invested approximately $2.5 billion on the expansion, including detailed engineering, site work and fabrication of major vessels.
One area of particular focus of the project, in an attempt to mitigate the environmental impacts of oil sands development, is improved water management. Suncor has reduced water use per barrel by nearly 50% during the past five years. With this expansion program, the company plans to spend $225 million to further improve water management. As a result of plans to reduce water consumption and increase treatment and recycling, the company did not seek an increase in its water licence for the construction or operation of its planned third upgrader. In Suncor’s in-situ operations, more than 90% of the water used for steam generation is expected to be recycled.
Suncor has reduced greenhouse gas emission intensity at its oil sands plant by approximately 50% compared to 1990 levels. While this expansion will lead to an increase in absolute greenhouse gas emissions, the company says it continues to investigate technologies such as carbon capture and storage that hold the potential for reducing absolute emissions in the longer term.
The company also continues to target technologies to reduce intensity in other emissions. For example, approximately $800 million is being spent to reduce sulfur dioxide emissions through the construction of a new sulfur plant. Improvements in emissions of nitrogen oxides are also expected and Suncor will continue to investigate gasification options, which could enable the company to process petroleum coke, an oil sands by-product, into an energy source. Investments in new equipment and processes are also expected to mitigate operational odors.
The expansion is designed to be completed in a phased manner. Mechanical completion of the new upgrader is expected to be completed in 2011, while bitumen feed from the new stages of in-situ production is expected to begin operation in 2009 through 2011. Crude oil production is expected to begin ramping up in late 2011, with full production capacity of 550,000 bpd expected to be achieved in 2012. Suncor’s plans for some components of in-situ expansion are still subject to regulatory approval and, as such, the company’s schedule is subject to change.
The capital required to fund the expansion is expected to be financed through cash flow from operations, credit facilities and access to debt capital markets.
Resources
Suncor Investor Presentation
January 31, 2008 in Oil sands | Permalink | Comments (34) | TrackBack (0)
Comments
Posted by: Jay Dee | February 05, 2008 at 02:27 PM
Hi! I'm Lorryuncori.
How are you? :)
Posted by: lorryuncori | February 05, 2008 at 05:25 PM
But what HAVE you bet on that makes you so confrontational about a possibly cheap ethanol process (such as from BRI/Coskata) ??I don't have a dog in that fight.
What I do have is a bunch of time analyzing both the energy and carbon flows for the various options, and a picture of the futures I do and don't want to live in. Converting biomass directly to liquid fuels is the worst of all options. With electricity, you can not only get many times the net work out, but you can extract hundreds of millions of tons of carbon from the atmosphere each year and sequester it. If you don't need the carbon removal, you could use the concentrated CO2 to run some of the more productive algae-growth systems and produce liquid fuels and chemical feedstocks as secondary (not primary) products. You lose all of that if you go straight to ethanol.
Since I don't see such a cheap ethanol process disappearingSince you don't seem to get the economic angle, I'll spell it out for you in a bullet list:
- Of all the once-through biofuel schemes, all but the ones using microalgae would be seriously limited by the available feedstock. (The microalgal schemes may not work out.)
- Limited feedstock means a limited supply of product.
- Limited product, in a world of declining oil supplies, means that the price will be bid up to parity with (very expensive) oil.
- A cheap process for producing a high-dollar product results in one of two things:
- Very high profits for the owners of the process, or
- Very high prices for the feedstock, resulting in things like entire crops and forests being fed to the process because it is immediately profitable.
And I've never seen a fuel cell, except for some toys1 megawatt MCFC stack operating in 1999
SRI claims MCFC/DCFC demonstrated at 300 kW
DOE has been running a program to scale SOFC's down to the 5-10 kW range to be suitable for vehicle APU's. You don't have to worry about thermal cycling in a stationary system; you just run them at minimum power all the time to keep them hot.
Meanwhile, the hungry Chinese will start to make electric cars - with batteries - and not impractical fuel cells.That's what's on the other end of the grid from the fuel cells (and wind farms, and nuke plants). We should have gotten started years ago with something like Firefly Energy's 3D² technology, but BushCo. sold the country out to the House of Saud.
Posted by: Engineer-Poet | February 05, 2008 at 08:59 PM
Exxon-Poet:
So, your links describe a 1999 Japanese stationary fuel cell research project, and another sponsored by Ohio & Illinois coal producers, ExxonMobil and Chevron. Both are only indirectly related to "Green Cars". And you insist there's already something economic about these research projects. But like I said, these sorts of fuel cells won't be commercial (if ever) for a long, long time (especially on vehicles).
I suppose some individuals might wonder why would ExxonMobil and Chevron, when selling liquid fuels so profitably, want to introduce a cheaper vehicle power source ?? If you swallow that, wouldn't cheap BRI/Coskata ethanol competition finally prompt ExxonMobil and Chevron to sell even more economical fuel cells ??
Look, I'm no friend of ExxonMobil and Chevron, but I can't accuse them of holding economical fuel cells off the market. And yet you insist that "somebody" has such fuel cells that are more economical than cheap BRI/Coskata ethanol, but you can offer no more than links to some far-from-commercial research projects.
You deserve a lot more feedback than I've given, so why not try your trolling at this recent Coskata article:
http://www.greencarcongress.com/2008/02/coskata-forms-s.html#comments
I'll tell you this for sure: If BRI/Coskata ethanol is cheap, I'll buy it, and maybe invest in it. And I hope the Chinese really use it - although they will remain more cost-sensitive and hence will develop more battery-driven vehicles. And if you don't like such a future, you'll just need to get de-sensitized.
Posted by: Jay Dee | February 06, 2008 at 09:10 PM
Exxon-Poet:Oooh, now that's clever! What's next, calling me a poopy-head?
your links describe a 1999 Japanese stationary fuel cell research project, and another sponsored by Ohio & Illinois coal producers, ExxonMobil and Chevron.You said you'd never seen fuel cells that weren't toys. I gave you a couple of things that were definitely not toys. How was I to know that you were going to complain about the nationality or corporate identity of the sponsors too?
wouldn't cheap BRI/Coskata ethanol competition finally prompt ExxonMobil and Chevron to sell even more economical fuel cells ??You haven't gotten the message yet: BRI and Coskata can't make enough of anything to cut XOM's profits significantly. Not even in principle, because the shrinking amount of domestically-produced petroleum (about 11 quad's worth per year) is roughly equal to the maximum amount of bio-ethanol that gasification processes can produce, ever. XOM can import raw materials; where are BRI/Coskata going to get them? No threat for a long, long time.
The real threat to XOM (aside from declining world oil production and resource nationalism) comes from electrics. The power for electrics comes from generators; the cleaner and more efficient, the more attractive to the public and the bigger the ultimate threat. SOFCs and DCFCs can produce several times as many vehicle-miles of energy from a ton of biomass than can BRI/Coskata.
you insist that "somebody" has such fuel cells that are more economical than cheap BRI/Coskata ethanolNever said that. I said they were more efficient, and ultimately more worth pursuing because they have the potential to completely solve several very sticky problems. BRI/Coskata is limited to partially solving one.
If BRI/Coskata ethanol is cheap, I'll buy it, and maybe invest in it.What I fear is that the temporary expedient (ethanol) will gain a lock on the supply of biomass, and prevent the emergence of the carbon-negative generators and electric vehicles necessary to get us to a regime which remediates human-produced climate change.
And if you don't like such a future, you'll just need to get de-sensitized.Next thing, you'll be telling me that I should just sit here and live with corn ethanol despite it being an environmental disaster. You can keep your advice.
Posted by: Engineer-Poet | February 08, 2008 at 10:39 PM
National Algae Association
Algae: The Next Biofuel
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April 10, 2008
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Posted by: b cole | February 25, 2008 at 01:06 PM
The divorce had been done under the veil of secrecy, according to Russian media, in February. The marrige will take place in St Petersburg on June 15, at the palace Konstantinovo.
Alina Kabaeva is 25 years old, Russian gymnast who has had major success on the international stage including Olympic gold in Athens.
She is considered one of the most beautiful Russian woman, and in 2007 entered the Russian Parliament as a member of the "United Russia" party.
According to sources, Putin and Kabaeva are more 'than friends' since 2000. Putin (56) has two daughters with Ljudmila, 23 years old Marja and 21 years old Katerina.
True or not, everything will be confirmed very soon, though is likely that Putin will follow in Sarkozy's footsteps.
Posted by: anjellika18 | April 27, 2008 at 10:17 AM
Leading film-makers are seeking to change the way we think
about other countries. This is one of a powerful series of
films to be shown on Pangea Day, May 10, “the day the world
comes together through film”. video blog
Posted by: nomatter | May 11, 2008 at 06:14 PM
If you've watched the previous debates, you've noticed the Perception Analyzer at the bottom of the screen. It records the reactions of about 30 "uncommitted" voters - but some say your brain can't devote its full attention to what the debaters are saying and what you're seeing.More..
by proxrte101a
Posted by: Smipsytusty | October 07, 2008 at 05:19 PM
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Strawman-Poet:
It's hard to take you seriously after you've claimed that you'd bet I'm a "juris doctor" (don't waste your money because you'd lose).
But what HAVE you bet on that makes you so confrontational about a possibly cheap ethanol process (such as from BRI/Coskata) ?? Tar sands projects ?? Exxon ?? Fuel cells ??
Since I don't see such a cheap ethanol process disappearing if it exists (although oil companies or oil sheiks may try to bury it), why not hedge any investments you've got that may lose due to cheap ethanol ??
If the BRI/coskata process can be shown to make cheap ethanol, then the process could be profitably introduced at a small scale. Over the course of many years (unless cheaper/cleaner vehicle energy supplies are found), BRI/coskata processing would increase until all the really cheap convenient feedstocks get used up (such as garbage, crop, and timber residues). Thereafter, algae could provide all the "scaling" you obsess about (but the sort of 100% "scaling" you insist on doesn't wipe out economic competitiveness anyway).
And I've never seen a fuel cell, except for some toys - so, even after all their hype, they seem to be impractical. They are initially expensive, and aren't durable at all due to inevitable fuel contamination and in the sort of conditions vehicles work. Low-temperature fuel cells (below the boiling point of water) have water disposal problems, as well as freeze-up and overheating problems (unless heat exchangers are huge). Solid-oxide fuel cells degrade quickly due to their high temperatures and their extreme temperature cycling. Carbon fuels cells are just a few mW in a lab somewhere. Someday, somehow, medium-temperature acid fuel cells may work adequately. Maybe ammonia could be an OK fuel (rather than hydrogen). But instead of blaming the "scaling" strawman of cheap ethanol, why not blame your inadequate fuel cells: For example, why not demand standard accelerated lifetime test results from your pet fuel cell projects (and electric-car batteries too), in order to calculate effective costs per kWh ??
Unfortunately, most Americans have become all too flabby about practicalities. They want Mars missions, and empty fuel cell hopes, and corrupting corporations like Exxon to do all their practical thinking for them, and then go to the mall and buy all sorts of toys from China. Meanwhile, the hungry Chinese will start to make electric cars - with batteries - and not impractical fuel cells. And the Chinese are desperate for fuel so if the BRI/coskata process is economical, they'll use it (even if denied licenses to the patents). So the BRI/Coskata process may soon find success but likely outside the US where people would appreciate the practical brilliance of Dr. Gaddy's vision (former head of the Chemical Engineering Department at the University of Arkansas - thus politically incorrect because Arkansas is not a state bought by Exxon):
http://brienergy.com/pages/about01.html
I haven't given up about getting good cost info. about the BRI/Coskata process - and (if the price is right) promoting/investing in it (if I was allowed the opportunity - but I wouldn't let Poet stop me). However, it's clear to me that others (like the Chinese) would want it a whole lot more (despite Poet's objections that it isn't perfect).