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From Greentech Media:

By Michael Kanellos

President Barack Obama and Canadian Prime Minister Stephen Harper this week have been enjoying each other’s company. The two have discussed tar sands, the goopy, sandy and dirty source of fossil fuels up there in the Great White North.

But how valuable are tar sands and can they be extracted?

Hyperion Power Generation, the nuclear-in-a-box people, say yes. The company’s sealed reactor can produce 70 megawatts of thermal energy, which can be used for separating the sand from the oil. The reactor, as the company has emphasized, is also not made to power condominium complexes and subdivisions. It is made to provide energy to remote, secure, and somewhat off-grid facilities like military bases and oil fields. The company expects to start delivering its reactors, developed at Los Alamos National Labs, in 2014.

Using nuclear — which does not generate fossil fuels — could play a important role in improving the greenhouse gas balance with tar sands. Canada’s tar sands contain 173 billion barrels of recoverable oil, according to proponents. (Critics put the figure much lower.) The world consumed 84.3 million barrels of oil a day in 2005. At that rate, tar sands could provide enough oil for 2035 days, or 5.58 years. (Oil consumption is expected to rise to 112.5 million barrels a day by 2030.). If you count the tar sands that can’t be recovered by existing means, the estimate of the reserves jumps to 1.7 trillion barrels.

That’s quite a bit. U.S. manufacturers are expected to only produce 250 gallons (gallons, not barrels) of cellulosic ethanol a year by 2011 and that is if everything works as planned. So far, cellulosic ethanol providers are behind schedule. Total ethanol production in 2007 worldwide from all feedstocks comes to 13 billion gallons. Divide by 42 to get barrels and factor in a discount because ethanol doesn’t provide the same energy per gallon that gas does and the figures for ethanol begin to look really small.

Finding ways to produce tar sands cleanly would still, however, leave the problem that you are burning fossil fuel. True, but liquid fossil fuels still aren’t our biggest problem. Transportation, where most liquid fuels go, account for only 26 percent of the total energy budget in the U.S. In other words, it might make more sense to tackle the coal problem first and use clean tar sand extraction as an interim step in what will be a decades-long quest for cleaner car fuels. And Canada is more democracy friendly than Kazakhstan.

Just a thought.

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This article has 22 comments:

  •  
    'producing tar-sand bitumen cleanly' is an oxymoron, there is massive environmental devastation to consider.
    > jack
    Feb 22 09:56 AM | Link | Reply
  •  
    Technologically speaking, nuclear energy is the way to go to create the steam used in oil sands processing. Using nuclear energy would generate zero emissions and liberate the current huge quantities of natural gas used in oil sands processing for other uses.

    Environmentalists are complaining about the current tar sands processing technology, can you imagine the uproar if nuclear energy was thrown into the process. I agree that oil sands producers should upgrade their processes to generate lessen emissions, but I am totally against shutting the tar sands down completely. The industry has created many well paying jobs. There is nearly zero unemployment in Alberta and the oil sands have reduced the employment rate across Canada, especially in depressed areas like Atlantic Canada.

    Environmentalists need to decide whether they want oil from Canadian tar sands (a strong and loyal ally of the USA) or oil from despots in Saudi Arabia and Iran (who fund terrorists against the USA with their oil proceeds).
    Feb 22 10:17 AM | Link | Reply
  •  
    Obama was up there begging Harper not to sell any of those assets to the Chinese. So yes, they are very important and nuclear power will help with the extraction.
    Feb 22 11:20 AM | Link | Reply
  •  
    I realize that the oil sands extraction is very hard on the enviornment, but to me it comes down to how we replace the oil from Mexico that is rapidly coming to an end. Mexico is going to be importing (not exporting) oil within a few more years, and they are currently our major source of oil. The 5 major Mexican oil fields are rapidly being depleted, and the Canadian Oil Sands projects will be needed to replace that source for the US, and without which we are back to financing the middle east problem, as others have already said.

    We are going to need all existing energy sources, including coal, to keep the US economy limping along at the current rate, and that does not account for what happens in a recovery.

    If the Canadian oil sands projects were to falter for some reason, or sold to the Chinese, or sold to someone with interests that were not friendly to the US, it would be a major blow to the US economy. We need that source of energy, or we will be in deep energy deficient trouble in the coming years.
    Feb 22 11:50 AM | Link | Reply
  •  
    Intriguing debate about the externalities linked to oil sands extraction: rape the earth or jeopardize security by rewarding unsavory folks in the Middle East?

    As for Saudi, bear in mind that a massive portion of the windfall the Saudis reaped has historically flown straight back to the U.S. (either by purchasing US products and services, or by investing in US companies). That's actually fairly typical for extraction economies - little sticks around to do any good or to enrich locals all that much; most flows back somewhere else (well, Dubai is unique).

    So, the "national security" argument in favor of the oil sands projects overlooks some other important trade relationships.

    As for environmental degradation - it's possible to recover land - just not cost effective. If you subscribe to the Keynsian solution to deflation - pay one team to dig a hole, pay another team to fill it in - then the tar sands projects will work wonders for Canada (but more likely, they'll leave ghastly scars in the land, as the money to clean things up proves grossly underestimated, and clean-up processes sit idle...)
    Feb 22 11:58 AM | Link | Reply
  •  
    The company’s sealed reactor can produce 70 megawatts etc.
    I have never heard of them before!

    Electrical heating of the strata is used successful by Shell Canada in BC. And, it makes a lot more sense environmentally than does burning huge amounts of natural gas to the same end.

    The problem has been cheap power which, apparently this outfit can provide. I don't know anything about these 70MW plants (usually nuclear plants run 2000 MW each) but have to wonder the wisdom of sticking them on top of the slurry the tar sands is made of.

    The Alberta Government has rejected any nuclear facilities for the tar sands instead backing the Mackenzie Valley pipeline and the natural gas that is to come south to provide the tar sands with much needed natural gas.
    Feb 22 12:10 PM | Link | Reply
  •  
    Interesting article, but not really relevant from an investment point of view. It sound like you're one of the saps (I'm one too) that invested in tar sand companies at the height of oil prices and then watched that money fly away when oil plummeted. I would like see a light at the end of that tunnel too. But nuclear powered steam generators? If the technology was proven ready TODAY, regulatory considerations would keep it out of the field before 2014! I'm a long, but not that long!
    Feb 22 12:24 PM | Link | Reply
  •  
    I'd bet Canadian currency will run 6% a year against the dollar for the next 5 years--
    Feb 22 12:30 PM | Link | Reply
  •  
    According to Stratfor Canada is interested in applying our 'clean coal' technology to the tar sands development. This will require some coordination between the two countries regarding international carbon emission regulations(Kyoto accords) but it appears this was on the agenda at the recent meetings between President Obama and Prime Minister Harper. With Chavez of Venezuala looking more like a new version of Fidel Castro, and Mexico's declining production profile, Canada's tar sands look like the logical replacement for unreliable energy from South America.
    Feb 22 01:23 PM | Link | Reply
  •  
    Spent nuclear fuel is a free, carbon-free energy source with the heating capacity to produce 6 billion barrels of Alberta's oil sands annually.

    A recently published study by Australian, French, Canadian and U.S. scientists notes the unprecedented capacity of bitumen to sequester radioactive materials and much of the oil sands (bitumen) is found beneath a capping shale formation that would further preclude either hydrocarbons or radionuclides from migrating to the surface.

    Importing the global inventory of nuclear waste removes the potential for the plutonium contained within it to be incorporated into a weapon that could be used against this continent. Placing weapons plutonium and separated commercial plutonium in the sidewalls or floor of a repository also meets the spent fuel standard for eliminating these materials.

    In about 100 years the most radioactive - heat producing - fission products contained in spent nuclear fuel will have decayed. In the meantime it will have depleted bitumen reserves and will be available as a new source of energy.The CANDU reactor is capable of burning spent fuel from pressurized water reactors, the majority of the global inventory, as is. Competing technologies require this waste be reprocessed, at significant cost, risk and environmental damage, to render it capable of reuse.

    Feb 22 01:46 PM | Link | Reply
  •  




    john s gordon

    "producing tar-sand bitumen cleanly' is an oxymoron, there is massive environmental devastation to consider"

    That's right. The Canadian tar sands has been called the most destructive project on Earth. The pollution from and waste of natural gas used to produce the oil are only part of the huge environmental impact of tar sands.

    ED K

    "I don't see any real use or impact of alternative energies for a long time,this could help."


    That is so completely wrong. it is just a popular canard used by the fossil and nuclear industries to keep renewables from being developed, and to keep the public in doubt about them. It is pure BS. Just because people say things does not make them true.
    It's disinformation and it's intentional.
    The public is being duped.

    Wind energy in the U.S. grew by 8.3 GW last year, and jobs in wind grew by 70% to 85,000, and now exceeds jobs in coal mining.
    Considering the 35% capacity factor for wind, that is the equivalent of building 3 nuclear power plants in one year, or 5-6 coal plants.
    Good luck building 3 nuclear plants in a year, maybe in a decade.

    Solar thermal with heat storage can replace coal plants with base load dispatchable power. We could build 50-100 GW of this by the time the first nuke goes online in a decade or so.
    Solar thermal (or CSP) with molten salt heat storage can run day and night. Electricity prices can already beat new coal or "clean coal", both of which aren't even proven. 9 small Solar thermal pilot plants in California have been
    putting out 355 MW since the late 80s to early 90s. Over 3 GW have already been signed for in California or are already being built. Just the beginning. This is solar with it's own energy storage. It's at least 20 times cheaper to store heat as to store electricity.

    Both solar thermal and wind, unlike new nuclear or "clean coal" are ready to build right now, and can be built much much faster than either coal or nuclear.

    A study by the Western Governors Association estimated that electricity prices from solar thermal (or CSP) would fall to below 10 cents/kWh after there were 4 GW of installed capacity in the U.S. There are already over 3 GW approved or already building, so that shouldn't take long.

    They also said prices would drop to 5-8 cents/kWh after the industry got up to scale. That would be about half what electricity from new nuclear or coal with CCS will cost.

    Note: the price estimates I've seen for clean coal are 16 cents/kWh - Some estimates for new nuclear are as high as 22-30 cents/kWh, though the numbers quoted most often are 12-17 cents. Solar thermal is 12-1 7 cents now. Wind is only about 7 cents.

    "Southern California Edison has contracted with BrightSource Energy Inc. for seven projects totaling 1,300 megawatts of concentrated solar-thermal power (CSP). CSP is a core climate solution, probably the zero-carbon form of electricity with the most potential, since it can be easily integrated with thermal storage and provide power reliably throughout the day and evening."
    ----
    www.rsc.org/delivery/_...

    "The time to plan and construct a coal-fired power plant without CCS equipment is generally 5–8 yr. CCS technology would be added during this period. The development time is another 1–3 yr. Thus, the total planning-to-operation time for a standard coal plant with CCS is estimated to be 6–11 yr. If the coal-CCS plant is an IGCC plant, the time may be longer since none has been built to date."

    "..... based on the most optimistic future projections of nuclear power construction times of 4–5 yr5 and those times based on historic data,64 we assume future construction times due to nuclear power plants as 4–9 yr. Thus, the overall time between planning and operation of a nuclear power plant ranges from 10–19 yr."

    "The median construction time for reactors in the US built since 1970 is 9 yr."


    "For CSP, the construction time is similar to that of a wind farm. For example, Nevada Solar One required about 1.5 yr for construction. Similarly, an ethanol refinery requires about 1.5 yr to construct. We assume a range in both cases of 1–2 yr. We also assume the development time is the same as that for a wind farm, 1–3 yr. Thus, the overall planning-to-operation time for a CSP plant or ethanol refinery is 2–5 yr. We assume the same time range for tidal, wave, and solar-PV power plants."

    Feb 22 02:21 PM | Link | Reply
  •  
    small nuclear reactors are located in most modern submarines, aircraft cariers, and the latest version of navel destroyer class. the reactor/electric generator need not be close to the tar goo. transmission infrastructure?


    On Feb 22 12:10 PM cyberclark wrote:

    > The company’s sealed reactor can produce 70 megawatts etc.
    > I have never heard of them before!
    >
    > Electrical heating of the strata is used successful by Shell Canada
    > in BC. And, it makes a lot more sense environmentally than does burning
    > huge amounts of natural gas to the same end.
    >
    > The problem has been cheap power which, apparently this outfit can
    > provide. I don't know anything about these 70MW plants (usually nuclear
    > plants run 2000 MW each) but have to wonder the wisdom of sticking
    > them on top of the slurry the tar sands is made of.
    >
    > The Alberta Government has rejected any nuclear facilities for the
    > tar sands instead backing the Mackenzie Valley pipeline and the natural
    > gas that is to come south to provide the tar sands with much needed
    > natural gas.
    Feb 22 02:26 PM | Link | Reply
  •  
    "As for environmental degradation - it's possible to recover land - just not cost effective. If you subscribe to the Keynsian solution to deflation - pay one team to dig a hole, pay another team to fill it in - then the tar sands projects will work wonders for Canada (but more likely, they'll leave ghastly scars in the land, as the money to clean things up proves grossly underestimated, and clean-up processes sit idle..."

    You must be kidding. You can't fix the Boreal Forest of Canada once you have destroyed it. It is one of the most important ecosystems in the world, being one of the biggest carbon sinks on earth. No kind of economics can restore the complexity and biodiversity once it is broken. See the articles National Geographic has done on the Boreal Forest. It is critical to much of North America's wildlife and water sheds. The tar sands is just one way it is being decimated. Scientists who study biodiversity say that breaking up large ecosystems like forests reduces the biodiverstiy drastically. A hundred thousand acre forest that has x number of species, when broken into smaller pieces, loses half the biodiverstiy. You don't end up with smaller forests with the same biodiversity of the original.
    Just filling in the holes you made won't cut it. Not even close.














    Feb 22 02:32 PM | Link | Reply
  •  
    cyberclark - google 'hyperion', there are a couple of promotional blurbs you can read,

    the obstacle at present being to obtain the necessary permits to build transport & operate/
    > jack
    Feb 23 08:36 AM | Link | Reply
  •  
    I read on Intenet

    "I discussed EROI in an article on Peak Oil, published Nov. 8, 2006. In general, EROI for tar sands exploitation is extremely low, on the order of 5-10%, as efficient relative-to-traditiona... oil recovery of conventional petroleum. Is it worth it to make such massive investments to recover bitumen that yields such a low “energy profit”? Obviously, the development is occurring. But it is still certainly worth it to ask the question. Where is all of this going? What are the long-term costs and trade-offs? By investing in one form of development with low EROI, is the North American energy industry failing to invest in any better alternatives?

    Here's his answer: Right now, the oilsands produce a little more than a million barrels a day for a global market with an 84-million-barrel-per-... addiction. In the sands, the big berries — just 20% of the resource — consist of a few large open-pit mines, while most of the small berries consist of in situ or steam-the-oil-out-of-t... projects. Aleklett and two colleagues concluded that Canadians could shovel and steam a full 3.6 million barrels per day by 2018, but not without self-inducing some bad migraines.

    The first headache is natural gas. It takes 1,000 cubic feet of natural gas to produce one barrel of bitumen; the oilsands now consume 4% of the nation's gas supply. Under a crash program, that tally jumps to 16% by 2018, and that would max out the gas market: "The supply of natural gas in North America is not adequate to support a future Canadian oilsands industry with today's dependence on natural gas." If Canada doesn't build nuclear power plants for in situ projects, the place will simply run out of affordable fuel, says Aleklett. "

    Feb 23 11:10 AM | Link | Reply
  •  
    Excellent article and some very interesting comments. I don't think that I have preached any sermons about tar-sands or oil-sands lately, but I think that the Canadians have the right idea about the rate of growth of production from those sources. My colleague Mr Aleklett believes that a crash program could produce 3.5 mb/d from Alberta, but that sounds a little high to me. Rather than stretch out this comment let me merely say that oil from Canada will not be able to compensate for the decline in production in Mexico, and the eventual stagnation in output in the Middle East.
    Feb 23 11:37 AM | Link | Reply
  •  
    Oil sands extraction needs more environmentally friendly methods of extraction or we are only kidding ourselves in regard to the enviromental issues. Only thing I see wrong with the article is the math; 173 billion barrels divided by 84.3 million comes out to 20,521.9 days, or about 56.2 years. Factor in an annual escalation and you're still talking 40+ years. Factor in new technologies such as nuclear and areas in the U.S. such as the Green River Basin will become more viable. This area is also huge. One drawback though, fresh water is becoming a very valuable commodity, one that we can't afford to waste as a pressure medium.
    Feb 23 02:15 PM | Link | Reply
  •  
    OK, enough; I live in Alberta and although there are some statements here that are true, there is much misconception.

    At present using the method of determining the current stock available through current economically feasible technology it is 173 billion barrels, however that figure grows to 315 billion barrels when estimating the reserve.

    The total stock is estimated at 1.7 to 2.5 trillion barrels.

    True the world consumes 84 M bbl/day; the US represents 15 M bbl/day using the lower total stock figure would provide the US with its current demand for 310 years and the world for 55.

    The pulp and paper industry in Alberta is harvesting some of the trees planted as part of their land reclamation requirements along the foothills of the Rocky Mountains. Farmers are harvesting grains off of lands reclaimed by the soft coal strip mining operations of the power companies west of Edmonton. I have watched this reclamation project for forty years, and although the scar of the strip mine is ugly it moves at a gradual pace and reclamation follows close behind. It is possible to have economically feasible environmental reclamation. The Boreal Forrest ranges from the beautiful landscapes along the river valleys to scrub forest and covers the northern half of Canada; the Alberta Boreal Forest is large, but pales in size against that of Ontario or Quebec. Huge forest fires along the magnitude of those recent bush fires in Australia are not uncommon.

    The Mackenzie Natural Gas Pipeline has been on the books for over 25 years and has yet to overcome all the regional native and environmental concerns.

    They are "Oil Sands" not Tar Sands. If you take a spade and scratch the surface of the bank by the Athabasca River, you will find it leeching. It is a misconception to believe this material is not producing its own environmental impact as part of nature.

    The current in-situ method of extracting the bitumen does create waste, however the water used in the process is recycled and consumed to an efficiency of 90%; the 500 ducks that drowned in the tailings pond in May 08 did land in some pretty ugly evaporation pools used to recover the last 10% of water as it evaporates. This accident was the result of a failed zone alarm system and not a systemic environmental malaise.

    The current decline in oil prices has slowed production in Alberta, it was expected to reach a capacity of 5 million barrels a day in ten years; at present US consumption of 15 million barrels a day that is one third of US consumption.

    The economic stimulus package combined with TARP is in excess of $1.5 trillion, or $4,300 per capita; the December 2008 Inventory of Major Alberta Projects is $270 billion over ten years or $9,200 per capita; this is private investment for the most part.

    To give you a visual idea of what the current volume of extractable reserves is look at:
    www.energy.gov.ab.ca/L... each square is six square miles; it takes fifteen hours to drive from Edmonton to the northern border of Alberta via Peace River and High Level.

    The government has provided an informative document for you to review:
    www.albertacanada.com/...

    As stated above Canada is a stable democracy, with public health care and banks still in the black. I am an American living here, but I can tell you the quiet Canadian is a pretty bright person and loves their environment more than most Americans; there has been a distinct failure on the part of the oil companies, the government and those of us living here to demonstrate and show that considerable effort and money is going into making the extraction of bitumen both economically and environmentally feasible.

    Any realist will recognize it is facile to discount this source of energy in the future variegated supply of our growing demand; it will be the foundation upon which the time needed to develop alternatives will hinge.

    So as one who will benefit from some return to economic stability in the oil markets I suggest you invest the time in learning the facts from the source and use common sense in evaluating the cost benefit/environmental risk.
    Feb 23 10:05 PM | Link | Reply
  •  
    Everybody wants to get a piece of the action in the Alberta Oilsands Industry, so also those who propose a new nuclear reactor to generate power for the oilsands.

    However Albertans, as well as the oilsand extraction companies will not be so dumb as to allow this to happen for the simple reason that it could take only one accident, quake, or act of terrorism to contaminate the entire oilsands area a and prevent any further extraction of the resource for thousands of years!

    There are now new non-polluting ways to create electricity from hydrogen and in fact create a lot more hydrogen in the process, by using methods recently patented by Blacklight Industries Inc.<www.blacklightpower.co...;. There process has already been made available under license to some power generating companies.

    Feb 23 11:11 PM | Link | Reply
  •  
    I am not technically knowledgeable but there are things being mentioned that may be viable. Nuclear energy plants so far have used materials which lend themselves to use in weapons and which tend to generate by-products which can be used in weapons. This is apparently a result of the needs of the cold war and the research done largely in support of military needs.

    More recently a move has occured in which Thorium has become a major player in nuclear power. Apparently Thorium based nuclear does not have many of the drawbacks of uranium and plutonium during primary power generation operation and does not have nearly the long-term problems of residual waste that uranium and plutonium do.

    The "reactor in a box" uses Thorium because it does behave better and is much easier to operate. Thorium is apparently much more plentiful and easier to extract.

    All this is an impression gained from reading in many of these forums. It may be reasonably valid or may suffer from biases and agendas of original sources. DIIK. Things to consider, be aware of, evaluate.
    Feb 24 05:30 AM | Link | Reply
  •  
    )(*&^ Anyone who has any illusions about the Canadian tar sands business should take a look at the March issue of National Geographic, not normally a prime source of financial and economic news for me. I’m not normally a big time environmentalist, but just looking at the glossy, eye opening pictures tells you that this is this an ecodisaster of Biblical proportions. A $50 billion investment by several firms over the last decade is now producing 750,000 barrels/day, and another $100 billion was headed north before prices crashed last year. You have to cut down a whole forest, remove two tons of peat, then another two tons of sand, and burn 100 barrels of oil equivalent to heat rivers of water to steam, just to produce a single barrel of oil. This gives you the world’s highest production cost, thought to be $80-$100/barrel. There are now 50 square miles of sludge ponds in Northern Alberta leaching a witch’s brew of poisons into the water supply, which has caused the local cancer rate to explode tenfold. We’re not just talking about a few sick ducks and fish here. Canada is the largest foreign supplier of oil to the US, accounting for 19% of the total, and half of that is coming from tar sands.
    Feb 27 02:41 PM | Link | Reply
  •  
    Global Resources Corp. (an American company)
    The only way to extract oil cleanly. Zero water used (no steam needed). Zero emissions. Canada has already pruchased 5 of thier 1 ton machines. The machines extract oil, diesel fuel, several types of gases from anything made from oil, like plastics, rubber tires..ect...they are consentrating on tires right now because of Obama pushing windmills.
    Jul 07 11:53 AM | Link | Reply