Although comfortably profitable with crude prices stabilizing in the $70 ballpark, extracting bitumen from Alberta’s oil sands can be a pretty inefficient process. A rule of thumb says producing one barrel of bitumen consumes about a thousand cubic feet of natural gas. When it comes to SAGD—Steam-Assisted Gravity Drainage—the best players are 30% efficient in terms of the amount of energy needed to mobilize the bitumen; the average is just 15%.
Then, assuming most of the planned two million barrels per day will be diluted and piped thousands of kilometres south to US Midwest and Gulf Coast refineries and perhaps soon to the Far East, it doesn’t add up to a good way of bringing motive power to your car.
I sat down with a visionary the other day: Professor Steven Larter of the University of Alberta and Canada Research Chair in Petroleum Geology, who has spent his entire adult life researching ways to make bitumen recovery more efficient; winning several medals and prestigious awards along the way.
Larter’s specialty is not only making SAGD and mining more efficient but researching novel uses of petroleum reservoirs as in situ refineries; and how natural microorganisms can speed normal processes of oil and gas formation to recover energy as methane or hydrogen rather than heavy oil.
In addition, he notes that 60 to 80 percent of greenhouse gases come from burning fuel in our cars—it’s unfair to blame the oil sands for it all. So even if we reduced energy recovery emissions to zero, which he says we should strive for, those would remain. His solution? “The only way you solve that is to centralize energy generation,” he says. He sees recovering oil sands energy as clean-burning gases, using them to generate electricity on-site, capturing and sequestering the CO2. That power is then transmitted efficiently and used to power electric cars and electric trains.
But he concedes that will take decades. “There will be massive resistance to the concept,” he says, “because it’s a fundamental change to the nature of the business.”