Alberta is a province with great energy resources, including sizable reserves of oil, natural gas, and coal. This presents both an opportunity and a challenge to the province. Alberta’s carbon capture and storage program has taken some of the challenges inherent with the responsible development of its 168 billion barrels of oil sands resources and turned it into a carbon capture opportunity.
Almost all (99 per cent) of Alberta oil reserves are oil sands – a naturally occurring mixture of bitumen, sand, clay or other minerals and water. Buried under the province’s northern forests, the development of the province’s bitumen resource has been an extensive exercise in land use planning, environmental monitoring and developing the right technologies.
The Alberta government strives to develop its energy resources in the most environmentally responsible way possible. One of the ways it has done so is by establishing a single regulator as part of a larger integrated resource management system. The government has enhanced each piece of the previous regulatory system, including monitoring and reporting, and created a more efficient system to support continued growth and environmental management.
With large-scale bitumen upgrading underway, the province recognizes carbon capture and storage (CCS) is one way to significantly reduce greenhouse gasses. Other initiatives include developing the province’s vast potential for renewable energy, including hydroelectricity, wind power and solar energy, and promoting energy efficiency. Alberta’s Energy Minister, Diana McQueen, is eager to share with global audiences the progress made on the province’s carbon capture projects. "Our CCS program is doing what we want it to do, and that's making sure that as we grow our economy and become a global energy supplier we are doing it in a responsible way and reducing our emissions here in the province."
In 2009, the Alberta government began its CCS program by committing up to $2 billion for large-scale projects and making changes to legislation that enabled CCS. Through a competitive process $1.3 billion was committed to two large scale CCS projects over a 15-year period (2010 to 2025) – the Alberta Carbon Trunk Line / Sturgeon Refinery and Quest. The funding program has been designed in a way that the projects receive funding only when certain benchmarks have been achieved and verified. This provides assurance to provincial taxpayers that their money is well spent and that the projects are meeting specific targets.
To ensure success in the projects, the Alberta government undertook a Regulatory Framework Assessment, which looked at the rules for CCS in Alberta and best practices from around the world. Over 100 global experts on CCS, including representatives from industry, environmental groups, scholars and government worked on this review. The process, which began in 2011, released its report in August 2013, and produced 71 recommendations and conclusions on how to improve CCS in the province.
The final recommendations in the report will help strengthen all aspects of CCS within Alberta, including clearly defining the roles and responsibilities of the agencies that regulate CCS in Alberta and creating clear approval requirements; encouraging cooperation and fair development of CCS among operators; reviewing notification requirements for those living in the area where large scale carbon sequestration is underway; and ensuring access to sites for monitoring, measurement and verification activities. Another recommended action is to clarify the details of the Post-Closure Stewardship Fund, including obligations from operators to contribute to this fund. Alberta Energy, the government department responsible for energy development policy in the province, has committed to further examination and implementation of the recommendations over three years. This will ensure the appropriate policies and regulations are in place for when the CCS projects begin operation in 2015 and 2017.
Enhance Energy is building a 240-kilometre Alberta Carbon Trunk Line connecting a bitumen upgrader and fertilizer plant outside of Edmonton with enhanced oil recovery projects . The plant, better known as the Sturgeon Refinery, will be the first refinery in Canada with built-in carbon capture capacity. The project is estimated to cost nearly $1.2 billion, with the company contributing $640 million, the Alberta government investing $495 million over 15 years, and the Government of Canada contributing $63.3 million. Development is well underway at the refinery site and it is expected to begin operation in 2017. Refinery aside, the partnership also continues to work on regulatory approvals and right of ways for its carbon pipeline.
The Quest project, a partnership of Shell, Chevron and Marathon Oil, involves retrofitting an existing bitumen upgrader outside of Edmonton for CCS and then piping the carbon dioxide 64 kilometres north where it will be permanently sequestered more than two kilometres below the surface. The project is estimated to cost $1.35 billion, with the Quest partners contributing $485 million, the Alberta government $745 million and the Government of Canada $120 million.
Minister of Energy Diana McQueen and Conservative MP Mike Lake tour the Quest Carbon Capture and Storage facility at Shell's Scotford plant near Fort Saskatchewan on April 17, 2014. The project is retrofitting the Scotford bitumen upgrader for carbon capture, designed for up to 1.2 million tonnes of carbon captured per year, piped 80 kilometres north and injected more than two kilometres below the Earth's surface. (Photo: Chris Schwarz/Government of Alberta)
Currently, the Quest project is half constructed, with all major regulatory approvals granted in 2013. Construction is underway at the upgrader site, on the pipeline and at the sequestration site. Additionally, work on the baseline monitoring, measurement and verification is underway, including work on ground water and biosphere sampling. The Quest Project is on track for commissioning to begin at the end of 2014 and production in the second quarter of 2015.
McQueen sees the progress being made on the carbon capture units as important component in Alberta’s approach to resource development. “Enhanced recovery is another positive impact of CCS projects. For Alberta this technology will allow for more efficient recovery of our resources and a greater return for citizens with less environmental impact. “
In addition to the benefit that CCS is bringing to Alberta and its energy industry, a fundamental part of Alberta’s CCS program is sharing its learnings with other jurisdictions and stakeholders as they move forward with their own initiatives. Both projects are required to share technical information on their projects, and this information has been made available on the Alberta Energy website making it available to stakeholders from around the world. “We know that CCS is a powerful tool against climate change and the more jurisdictions taking advantage of this technology will be better for our planet and for future generations,” said McQueen.
The knowledge sharing efforts are expected to lower the cost of future CCS projects, and capitalize on expertise from around the world to improve CCS in Alberta. One government in particular that is paying attention to what is going on in Alberta is China, where sharing information on CCS was included in a Memorandum of Agreement between China and the province of Alberta in October 2013. Delegations from around the world have been visiting Alberta to learn more about the projects underway and the policy work being done within government.
Alberta’s commitment to CCS is unprecedented for a jurisdiction of 4 million people, and speaks to the importance the province places on responsible development of energy resources the world wants and needs.