CCUS
The world needs it.
Alberta can lead it.
As a fossil fuel power, Alberta’s resources face increasing pressure to maintain our market share as both consumers and governments transition to a lower carbon energy mix. Carbon Capture Utilization and Sequestration (CCUS) is an important component of ALL credible ‘carbon neutral’ strategies, and Alberta announced their intention to launch a Storage Hub strategy late spring 2021. The current Storage Hub strategy envisions the utilization of large deep saline aquifers that are centrally located to afford economic access by large CO₂ industrial emitters, for permanent verifiable non EOR storage of CO₂.
On April 1, 2022, the Bison operated Meadowbrook Carbon Storage project consortium was announced as a recipient of one of six Evaluation phase carbon storage tenures for a 70,000ha block north of Morinville, Alberta which will service customers proximal to the Alberta Industrial Heartland. On September 20, 2022, Bison finalized the award of the tenure and commenced active Evaluation phase activities which are expected to be complete by late 2023. In October 2023 Bison was awarded a second Hub evaluation agreement for the North Drumheller (ND) Carbon Storage project as part of the second round of Hub awards which brought the total number of Hub tenures issued in Alberta to 25.
In July 2023 the Alberta government announced the intent to offer SSR (small scale and remote) CCS tenures in support of bespoke emitter requirements and non-deep saline aquifer applications.
Alberta has a long history working with CO₂
The Carbon Capture and Storage Process
Provided by the Global CCS Institute
Alberta has a long history and strong regulatory expertise in the management of the subsurface injection, disposal and permanent sequestration of CO₂.
Over 40 acid gas injection (AGI) projects have been licensed in Alberta and BC over the last 30+ years. Acid gas is the term used to describe the portion of a naturally occurring gas stream that is removed during processing to deliver the commercial spec gas we accept from our local gas distribution company. The largest components of hydrogen sulphide (H2S) and CO₂, with CO₂ representing as much as 80% of some acid gas streams. In these applications, the acid gas stream separated from the hydrocarbon stream is then injected into a subsurface aquifer, usually very close to the location of the gas processing plant, into geologic strata where it will not affect any potable water use or hydrocarbon recovery. Phase behaviour, reservoir effects, safety and containment issues, and industrial process design and operations are all very similar between AGI and CO₂ Sequestration. The scale of injected volume over the project life, and injection rate, are the major differences. The Alberta Energy Regulator (AER) has overseen the licensing and operation of all these projects and is recognized to be a global leader in this role.
CO₂ has been injected, and cycled, in select applications (>13) for over 40 years in an attempt to enhance oil recovery (EOR). The AER also oversees the regulatory aspects of these projects.
More recently, and at a much larger scale, two commercial projects have been initiated, Quest (Shell) began sequestering up to 1Mtpa from the Scotford refinery into a deep saline aquifer north of Redwater in 2015 and Enhance/ACTL (target 1.7Mtpa) take CO₂ from the Industrial Heartland area for EOR into the Clive Leduc reef (2019) in central Alberta. These last two projects required a combined $1.2bn in Govt. financial support in part because there was no established ‘price’ or tangible value attributable to the capture and storage of CO₂, or at least not enough in the case of ACTL to justify the project on EOR alone.
What this history shows is that we have the understanding, experience, equipment, and ability to undertake a very large effort if we chose to, with a very high chance of a safe successful outcome. It’s not a given, and not without risk. It will require the same diligence which has enabled Alberta to assume and maintain its leadership position in oil and gas exploration and production operations over the last 75 years.
What’s Alberta’s future with CO₂?
Given that there is no inherent ‘value’ in CO₂ in the volumes that will need to be sequestered, a synthetic price/value must be created to incentivise its capture and storage. The federal carbon price and the TIER program in Alberta are key elements of what is required to achieve this, and other elements are the subject of discussion (investment tax credits, provincial APIP program) and negotiation (transferability and/or monetization of credits) at present. In our modeling we have assumed that federal carbon pricing will remain enacted at current forecast prices, as will the TIER system (or equivalent), and that the stringency equivalency currently envisioned will be maintained in some fashion. In fact, with federal government announcements targeting a 40% reduction in CO2 emissions from 2005 levels by 2030, it’s difficult to get anywhere near that level of performance without increased stringency. Until we develop utilization at massive scale, the best we can hope for is to capture and store CO₂ at as low a cost as is possible in a similar manner as we do today in operating a landfill or water disposal system.
Given the Alberta energy industries operating experience, our reservoir knowledge, our regulatory history and our emissions heavy starting position, the opportunity presently exceeds 50Mtpa. This will take multiple projects at many locations across the province.
The Edmonton industrial area hosts >60 large emitters with annual CO₂ emissions >35Mtpa. The top 5 oilsands producers have combined emissions >60Mtpa. The ‘hub’ concept seeks to address this concentration of emissions by developing multi-client storage facilities servicing bespoke capture solutions. The province awarded six projects targeting the Alberta Industrial Heartland, including the MCSP, and has announced 19 second round awardee’s servicing the balance of the province. Bison’s North Drumheller Hub will target Calgary area and bespoke emitters that could co-locate at our zero emissions site.
The economic benefits that will accrue to Alberta achieving a leadership position in the nascent CCUS industry are substantial
Alberta industries paying TIER tax will have a competitive option, and advantage, in achieving planned and future emissions reductions. These will be increasingly important with the introduction of Low Carbon Fuel Standards.
Bison LCV targets transportation and storage of captured CO₂ at <$15-20/ton with commercial scale development. Low-cost compliance options will support future emissions reductions and allow Alberta industry to deliver world class emissions performance in an increasingly emissions sensitive world.
Alberta oilfield service and engineering companies have the experience and expertise in delivering this technology and will increasingly have the opportunity for its delivery in Cleantech applications in other jurisdictions
Our sequestration sites will be innovation hubs where “greening” technologies will be piloted and commercially deployed. We already have ongoing discussions around emerging technologies in blue hydrogen, small scale CO2 capture and overland transportation, that would benefit by co-locating with a ‘net zero’ location. Securing energy transition innovation leaders will drive the provinces aspirations for economic diversification.
Our performance will be auditable for our clients use in emissions reduction targets, for investors or for other jurisdictions, thereby commoditizing CO₂ in a manner that will be revenue positive to the Alberta economy.