December 23, 2009
Statoil Committed To Canada's Oilsands
By: Lynda Harrison
Statoil Canada Ltd. has a new Canadian president who says this country's oilsands represent a key part of the company's global strategy and his company is committed to developing them in a manner that balances social, economic and environmental concerns.
"There is a connection between population growth, higher standards of living, energy demand and climate change," Lars Christian Bacher told the DOB in an interview. "That, we are aware of, and those are challenging dilemmas. But they also form the energy reality on which Statoil's activities are based. We will work every day to reduce the greenhouse gas emissions from our operations and at the same time help the world to get access to sufficient energy."
Bacher took up his new position in September to oversee Statoil's oilsands operations in the Athabasca region, exploration and development off the coast of Newfoundland and the company's new heavy oil technology centre in Calgary.
The Norwegian led the restructuring and integration of the company's operations on that country's continental shelf and has held several management positions at the Norne and Statfjord fields in the North Sea. He was vice-president of Statoil's Gullfaks operations.
One of four Statoil research centres in the world, Calgary's new heavy oil research centre will house the company's first technology hub for Statoil outside Norway, he said.
The centre will be responsible for the majority of the company's heavy oil activities in Canada and elsewhere such as Venezuela, said Bacher. Its implementation plan is expected to be finalized in February.
The centre is being operated in partnership with a number of locations and colleagues in Norway who are sharing information, said Peter Symons, Statoil's director of communications
"The facility itself is up and running now and we're building critical mass in terms of the folks we're bringing in," said Symons. "It's kind of a work in progress. There's a suite of technology plans they're working on, some of which are proprietary."
Some of that work is on steam-solvent co-injection (SOLVE) technology, designed to demonstrate a minimum 10% savings on the steam-to-oil ratio (SOR) required for extraction, with a potential saving of as much as 25% (Daily Oil Bulletin, Sept. 11, 2009). Statoil is collaborating on the project with Regina-based Petroleum Technology Research Centre.
Now 73% built, Statoil Canada's first steam-assisted gravity drainage project at Leismer is on budget and on schedule to start steaming in late 2010 and begin producing 10,000 bbls of bitumen per day in 2011, followed by another 10,000 bbls a day in 2012 if the company receives regulatory approval, said Bacher.
The company is not releasing its estimated cost. Leismer and its other oilsands leases, Hangingstone, Thornbury and Corner, about 150 kilometres south of Fort McMurray near Conklin, contain an estimated two billion bbls of recoverable oil. Together the leases comprise the Kai Kos Dehseh SAGD Project.
Statoil is working on reducing the project's land use, water handling and greenhouse gas emissions, and plans to recycle more than 75% of the water it uses, said Bacher.
"Steam-solvent co-injection is being used on several wells to potentially reduce CO2 and water consumption," said Symons. "We're trying to bring down the SOR and enhance recovery. We're looking at a number of technologies, some of which are proprietary, to reduce water usage and carbon dioxide as much as we can."
Leismer is designed to have an SOR of 3.0. That is dependent not only on how Statoil operates but on the quality of the reservoir, said Bacher. "After starting up we'll see how the reservoir is responding. We will work hard, day by day, to reduce it. We are in our final phase of preparing our CO2 plan internally where we will describe the different measures and activities we will take to reduce our CO2 emissions, thereby setting our ambition level. Our ambition is to be an industry leader within SAGD operations, not only CO2 emissions but in general."
Leismer will not be carbon-capture ready when built but the company is considering such modifications for its first turnaround, he said.
"Our future plans are to be CCS ready but of course the CCS technology as such needs to improve rather substantially financially to make it viable."
Statoil is a pioneer in carbon capture and storage, said Bacher. It is involved in four large-scale commercial projects involving carbon capture: the Sleipner project in the North Sea; Snøhvit liquefied natural gas production in northern Norway; a carbon dioxide facility at a refinery in Mongstad, Norway and a CO2 injection facility at a gas field in In Salah, Algeria.
The company entered the Canadian market by acquiring North American Oil Sands Corporation in 2007 for $2.2 billion.
An upgrader for the oilsands production was in the plans but citing prohibitive construction costs, the state of the global economy, an uncertain oil price outlook and lack of legislative clarity, Statoil put that on the shelf, where it remains (DOB, Dec. 4, 2008). In 2008 Statoil merged with an offshore unit owned by Norsk Hydro, whose exploration and production activities started in Canada in 1996.
Statoil has a 15% stake in Terra Nova offshore Newfoundland and a five per cent stake in the Hibernia field, operated by Hibernia Management and Development Company Ltd. Statoil also has a 9.7% interest in the Hebron Ben Nevis oilfield, which is being considered for development. ExxonMobil Canada is the operator for this field. In total, Statoil currently has offshore ownership interests in Canada in seven exploration licences and two production licences.
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