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ExxonMobil brings Kearl oil sands expansion online ahead of schedule; overall capacity doubling to 220K barrels per day

Exxon Mobil has started production at its Kearl oil sands expansion project in Alberta, Canada ahead of schedule; the expansion is expected to double overall capacity to 220,000 barrels of bitumen a day, with the expansion itself ultimately expected to reach 110,000 barrels per day. Kearl will access approximately 4.6 billion barrels of resource for more than 40 years. (Earlier post.)

The expansion project consists of three additional trains that use proprietary paraffinic froth treatment (PFT) technology to produce bitumen. PFT technology processes bitumen on-site to remove water and solids and improve bitumen quality. The bitumen is then blended with condensate to create a diluted bitumen product.

The PFT process removes a portion of the heavy end of the barrel (asphaltenes) using less energy than would be required to remove the same heavy ends in a coker at an on-site upgrader, thus reducing greenhouse gas emissions.

Eliminating the need for an on-site upgrader also avoided a multi-billion dollar capital investment and associated operating expenses. Energy needs are further reduced through the installation of energy-saving cogeneration facilities.

Kearl is a heavy, high-sulfur, diluted bitumen that is suited for refineries with heavy crude capabilities. Kearl has an API gravity of 22.6 (whole crude), and contains 3.4 wt% sulfur and 8.9 wt% Conradson carbon, making it an attractive coking crude.

ExxonMobil says that the project produces blended bitumen with about the same lifecycle greenhouse gas emissions as the average crude oil refined in the United States.

(According to a May 2014 report from IHS Energy, 45% of the crude oils consumed in the United States are within the same GHG intensity range as those from the Canadian oil sands. Comparing the oil sands against the average crude oil baseline estimated by IHS for 2012, refined products from oil sands has life-cycle GHG emissions that are between 1% and 19% higher than the average crude oil consumed in the United States. This places oil sands within the same GHG intensity range as 45% of crude oil supplied to US refineries in 2012.)

(More specifically, IHS Energy estimated that, under wide boundary conditions, mined bitumen treated with a PFT process (as is Kearl bitumen), results in approximately a +3% difference in well-to-wheels GHGs compared to the “average US barrel refined in the US”.)

Other environmental innovations include on-site water storage to reduce water use, progressive land and tailings reclamation, and a state-of-the-art waterfowl deterrent system.

Furthermore, Alberta stated that any EPEA approval that may be issued for the KOS Project may require Imperial Oil to reach its stated GHG intensity target of 40 kilograms (kg) of carbon dioxide equivalent (CO2e) per barrel.

(The California Air Resources Board (ARB) established the 2014 Crude Average carbon intensity of 11.30 gCO2e/MJ, calculated by weighting the carbon intensity value for each crude by the volume supplied to California refineries during 2012, 2013, and 2014.)

Kearl’s bitumen was first processed in ExxonMobil refineries to help the company fully understand its properties before introducing it to the market. It is now processed in more than 25 refineries around the world.

—Neil Duffin, president of ExxonMobil Development Company

ExxonMobil expects to increase its global production volumes this year by 2% to 4.1 million oil-equivalent barrels per day, driven by 7% liquids growth. The volume increase is supported by the ramp up of several projects completed in 2014 and the expected startup of seven major developments in 2015, including the Kearl expansion, Hadrian South in the Gulf of Mexico, Banyu Urip in Indonesia and deepwater expansion projects at Erha in Nigeria and Kizomba in Angola.

The Kearl project is located about 75 kilometers northeast of Fort McMurray, Alberta, and is operated by Imperial Oil Limited, an ExxonMobil affiliate.


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