New CO2 pipeline planned for heartland

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By Paul Grigaitis - Sourced From

A planned pipeline that will connect CO2 suppliers in the heartland with an enhanced oil recovery project in the Leduc and Nisku area will be an incentive for future industry to develop in the heartland, said Susan Cole, president of Enhance Energy.

The pipeline that will be used to recover oil that would otherwise remain underground will also sequester the CO2 underground therefore reducing greenhouse gas emissions as well, Cole said.

Future industrial facilities like upgraders wouldn’t be abe to be built without the pipeline that will provide a solution for the heartland’s CO2 emissions, she added.

If approved, the pipeline, phase one of a larger network, will be able to connect to future facilities.

“What we are doing will really assist those projects in either continuing operation or actually creating new industry,” Cole said.

Enhance currently has CO2 supply contracts with Agrium and Northwest Upgrading.

Several upgraders have been planned for construction in the heartland, but only an expansion of Shell’s Scotford upgrader has gone ahead with plans. Others have been bought out or delayed.

BA Energy has put its half-built upgrader on hold for three to four years, StatoilHydro has delayed the start of an upgrader by two years, and Total, who bought land owned by Synenco, has delayed plans for an upgrader by one year.

North West Upgrading is looking to find additional funding for their planned upgrader and Petro-Canada recently delayed a decision on whether or not to proceed with its partners on the planned Fort Hills upgrader.

“Having our pipeline in place will allow these new facilities to have an outlet for their CO2 and in someways provide an incentive to construct in the heartland area,” Cole said.

Enhance Energy was at the Dow Centennial Centre providing details on the project during an open house last Wednesday.

The Calgary-based energy company has partnered with Fairborne Energy on the project that comes with a cost of $300 million dollars for the pipeline and carbon storage portion. Enhanced oil recovery comes with extra costs somewhere in the hundreds of millions, Cole said.

The project will allow the sequestration of up to 14 million tonnes of CO2 per year.

“We’ll be able to produce a lot more oil, but that oil is essentially green because at the same time we will put CO2 underground and store it,” Cole said.

Wednesday’s open house was part of the public consultation process required by provincial regulatory rules.

If approved, the pipeline would be built by mid-2011.