Most of the bitumen produced at Suncor’s Firebag and MacKay River SAGD operations is upgraded at Suncor’s Base Plant. More pipeline capacity would reduce the need for storage in Alberta and lower transportation costs. Partial upgrading of oilsands could fetch additional $10-15 per barrel: report. Oilsands & Heavy Oil TSX:SU $15.955 0.845. In 2018, the United States imported 2.4 million barrels of medium, sour crude per day, only 15 percent of which came from Canada, according to IHS Markit. Upgrading is the process that increases the ratio of hydrogen to carbon in these heavy components; one way to achieve this is by rejecting a portion of the carbon from the bitumen. Among the other companies grappling with ways to help alleviate Alberta’s problem is Calgary-based Fractal Systems, which intends to profit mainly by removing and reselling diluent from heavy crude. This ‘decarbonization’ could result in: Our Fort Hills mine uses Paraffinic Froth Treatment (PFT) to convert bitumen froth into a partially upgraded, fungible product. As capital costs for Alberta's upgraders spiralled out of control and US demand for light/sweet crude declined, the economics of upgrading bitumen in Alberta no longer made sense. Since Alberta's refineries are already at capacity, most of Alberta's crude is destined for export, mostly headed for the US Midwest and Gulf Coast. And if you can make any of those steps cheaper and cleaner it’s going to lift the game.”. Many also include a de-salting step prior to distillation. Today, about 60 per cent of Alberta’s oilsands production is shipped in its raw form, which requires companies to mix the bitumen with a lubricant known as diluent to mobilize it. The alternative, of course, would be to build a whole new highway. Our Standards: The Thomson Reuters Trust Principles. From the producer's point of view, this comes at an added cost, soon to be priced at $50 per tonne of carbon. About 35% of bitumen produced from the oil sands is upgraded into synthetic crude before being sold to market. In 2012 Suncor Energy Inc. cancelled the construction of its $11.4-billion Voyageur Upgrader, and in 2016 CNOOC suspended plans for an upgrader at its steam-driven Long Lake oilsands lease. The rest is typically upgraded into a more refined product known as synthetic crude oil. True, but full upgrading isn't the alternative. 1 located NE of Edmonton (Shell Scotford upgrader). “Our crude oil would have a tailor fit to refineries, so we would have no problem to find the market,” Value Creation Chief Executive Columba Yeung said in an interview. Upgrading is a process by which bitumen is transformed into light/sweet synthetic crude oil (SCO) by fractionation and chemical treatment, removing virtually all traces of sulphur and heavy metals. In PFT, asphaltenes (the low-value, heavy fraction of the mined bitumen) are removed to create a lighter, higher quality product that requires less diluent to transport by pipeline, and no upgrading requirements leaves us more flexibility for downstream processing. “There’s a case to be made for product diversification,” said IHS Vice President Kevin Birn. All quotes delayed a minimum of 15 minutes. Simple refineries can only process light crude feedstock with a low sulphur content. Researchers at the University of Calgary School of Public Policy released a report Thursday saying that — under certain scenarios — the construction of a typical partial upgrader would net billions in returns to private enterprises and government over a 20-year period. Getting any new process off the ground requires lots of time, patience and in many cases, government intervention. “If you’re developing a new technology, it’s a risky business,” said Neil Camarta the president and CEO of Calgary-based Field Upgrading. We encountered an issue signing you up. Put another way, if you want to reduce congestion on a highway, you need to remove a lot of cars to make a difference. Residue from the VDU is sent to Primary Upgrading for conversion/cracking into a lighter hydrocarbon. The economics of upgrading depends on the required product quality, the needs of the final customer, and the price differential between heavy/sour and light/sweet crude. SYNTHETIC VS CONVENTIONAL CRUDE OIL: COMPARING PRODUCT SPECS. A member of Dow Jones Sustainability indexes, FTSE4Good and CDP, Suncor is working to responsibly develop petroleum resources while also growing a renewable energy portfolio. The timing for partial upgrading comes with risks, however. The savings, therefore, are not in having to buy and sell diluent, but rather in the diluent transport costs. The viability of partial upgrading is part of a broader discussion about how Canada can receive the highest possible returns from its sprawling oilsands reserves. In 2017, we invested approximately $350 million in technology development and deployment as part of a robust technology strategy, to optimize current assets and develop next-generation facilities. As more refineries around the world convert to heavy oil feedstock, there is less of a demand for stand-alone bitumen upgrading. The vertical towers typically contain horizontal trays that separate the hydrocarbons based on boiling point. The Edmonton-area plant would turn 77,500 barrels per day (bpd) of diluted bitumen into medium crude oil and low-sulfur diesel, starting in 2022. A member of Dow Jones Sustainability indexes, FTSE4Good and CDP, Suncor is working to responsibly develop petroleum resources while also growing a renewable energy portfolio. By now, most Albertans have figured out that rapidly expanding oil production coupled with limited pipeline capacity has created a logistical nightmare as producers look for alternative ways to get their oil to market. This is likely the future of upgrading in the oil sands. Producing a medium grade would give the world’s fourth-largest producer more of a different type of crude to sell that does not compete with abundant U.S. light shale oil. It removes sulfur and other impurities to create lighter grades of oil that do not require dilution to move through pipelines, lowering costs and making shipping more efficient. Unless the producer has a dedicated pipeline or relies on crude-by-rail, partially upgraded bitumen will travel on the same network as diluted bitumen. Partial upgrading is an interesting technology that has the potential to reshape the oil sands industry. However, with nearly one million barrels per day of oilsands production expected to come online in the next five years, producers could continue to face constraints in the near future. The government has already forced output cuts, given subsidies to petrochemical plants and said it would invest in trains to move crude. Carbon & Sustainability Distillate products from the LC-Finer are processed in an integrated hydrotreater. CALGARY — A new report suggests that Canada would benefit from higher capacity of so-called “partial upgrading” technology, a process that would help oilsands players fetch a higher price for their product and ease longstanding pipeline woes. Residual sulphur is oxidized with sulphur dioxide, before being discharged to atmosphere.
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