INDUSTRY BRIEF
Innovations to Secure the Future of Canada’s Oil Sands Industry in a Net Zero Emission World BY DR. JOHN ZHOU, VP CLEAN RESOURCES, ALBERTA INNOVATES INTRODUCTION
also be discussed.
Governments and businesses around the world have been making pledges to reduce greenhouse gas (GHG) emissions to net zero. Net zero emissions (NZE) for a country, business or other entity means it will either emit no GHG emissions or completely offset its emissions.
Follow-up papers are to be developed for presentation of detailed information on selected areas identified in this high-level summary.
Society will continue to demand crude oil and natural gas while the energy transition takes place and in an NZE world. The future of the hydrocarbon industry in an NZE world may be secured if NZE can be achieved across the life cycle of production through to consumption of the oil and gas. The combined environmental, social, and governance (ESG) performance of the oil sands industry has improved over recent decades to become one of the best in the world (Dziuba et al., 2021.). GHG emission intensity in oil sands production decreased by 20% between 2009 and 2018 (IHS Markit, 2018) and the emissions intensity from some large oil sands assets is comparable to the average U.S. barrel of oil (Sleep et al., 2020). However, the growth of the oil sands industry production has been outpacing the rate of decrease in GHG emissions intensity, so absolute GHG emissions in oil sands production have been increasing. Total GHG emissions from oil sands extraction were 83 million tonnes
“The future of the hydrocarbon industry in an NZE world may be secured if NZE can be achieved across the life cycle of production through to consumption of the oil and gas.”
Decarbonizing Bitumen and Fuel Production Processes In the coming decades of energy transition, while there are still large demands for oil, bitumen can be positioned as the preferred barrel by targeting bitumen as “the NZE crude oil” or the crude oil with the lowest GHG production intensity. Bitumen-to-fuel refinery processes will also require decarbonization. Recently, six oil sands operators, representing 95% of Canada’s total bitumen production, committed to the goal of achieving net-zero emissions from the companies’ oil sands operations by 2050 (https:// www.oilsandspathways.ca/). Their Oil Sands Pathways to Net Zero initiative will position Canada as the supplier of choice for responsibly produced oil needed to meet the world’s energy demand. Significant technology developments in last 15 years have enabled meaningful reductions of GHG emissions from oil sands production. Continued future GHG emission reductions in the industry can be achieved through combining multiple innovations in the next two-tothree decades, including: z
Energy efficiency and process improvements, particularly for in situ projects. These include increased use of cogeneration, more energyefficient water treatment and steam generation, digital oilfield tools, steam additives, non-condensable gas cap, etc. In combination, these may lead to up to a 20% reduction in upstream direct GHG emissions.
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Electrification and fuel substitution in drilling, mining equipment and vehicles, etc. In oil sands mining, these have the potential to reduce upstream GHG emissions by more than 10%.
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Carbon capture, utilization, and storage (CCUS). Natural gas combustion is responsible for 50 - 85% of direct GHG emissions in bitumen production. CCUS has the potential to greatly reduce such emissions. CCUS has been commercially demonstrated for flue gases with high CO2 concentrations in emissions from upgrading and refinery facilities; however, CCUS requires more development and demonstration for applications at lower CO2 concentration streams from natural gas combustion (once-through steam generators, co-generation, and natural gas combined cycle).
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Low emission hydrogen including blue hydrogen produced from natural gas coupled with CCUS. Blue hydrogen may reduce GHG emission by 50% in upgrading and refinery processes.
in 2019, representing 11 per cent of Canada’s overall GHG emissions (Environment and Climate Change Canada, 2021). This paper highlights a range of key innovations required for the oil sands industry to achieve NZE from production to end use. Emphasis is placed on direct GHG emissions (Scope 1) created during the production of bitumen and fuel production. Indirect GHG emissions (Scope 2) in bitumen and fuel production operations (typically utilities provided to the operations), and emissions from product consumption (Scope 3) will
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