Bitumen
Who’s Who ?
Six
influential individuals who's opinions count regarding oilsands
development
From Western Gold: Heavy Oil and Oilsands in Canada
Canadian Bitumen
By
Oilweek Magazine
There
are a lot of things about Alberta’s oilsands that
are nice to know:
The resource covers an estimated 140,000 square kilometres,
arching across northern Alberta from the Peace River region
in the northwest to the Fort McMurray region in the northeast,
where the bulk of the resource is found.
There are an estimated 175 billion barrels of bitumen locked
in the oilsands, some say enough to satisfy global demand for
petroleum for the next 100 years.
Mineable
bitumen deposits are located close the surface, and all of
Alberta’s mineable sands are found in the Fort
McMurray area.
About two tonnes of sand must be dug to yield just one barrel
of oil.
The vast
majority of Alberta’s bitumen resource is found
at depths greater than 75 metres—too deep for mining
techniques. For these deposits, most deeper than 400 metres,
various in situ techniques have been developed that either
apply heat to the bitumen or thin the bitumen through the use
of additives to coax it to flow to production wells.
Over the next four years, industry will spend an estimated
$77 billion bringing new mining and in situ projects on stream.
Current oilsands production averages more than a million barrels
per day; over the next decade, that figure could triple, and
by 2030, daily oilsands production could be as high as five
million barrels per day.
Those are all things that are nice to know about Alberta’s
oilsands. But in the hurly-burly world of Alberta’s bitumen
boom, often who you know is at least as important, if not more
important, than what you know. The oilsands business is peppered
with folks who are key to the successful development of a new
project, to the profitable operation of an existing project,
to living life in the midst of Canada’s greatest economic
boom in more than a generation.
These are some of those people.
Dr.
Maurice Dusseault
Deputy director, Porous Media Research Institute
University of Waterloo, Ontario
Why you need to know him:
Maurice Dusseault is one of the many people who are a product
of the Alberta Oil Sands Technology and Research Authority
(AOSTRA), which has been replaced by the Alberta Energy Research
Institute. Many of these people hold key positions in the heavy
oil and oilsands industry today. Maurice Dusseault has authored
close to 400 technical papers related to heavy oil and oilsands,
and is exemplary of the “addictive buzz” the industry
creates.
What was AOSTRA? What were its key accomplishments?
AOSTRA
was created in 1974 by the Alberta government, and lasted
25 years as an agency to fund research into oilsands
technology. It supported research with industry to the tune
of over $800 million during this period. Perhaps its stellar
accomplishment was to fund a field pilot in steam assisted
gravity drainage, despite profound industry disinterest at
the time. This technology, affectionately called SAGD, has
revolutionized the heavy oil industry, resulting in 174 billion
barrels of recoverable reserves to be allocated to Alberta
in 2002–2003.
Why is collaboration important for oilsands and heavy oil
research?
Oilsands and heavy oil research has benefited from single
academics working alone in universities, and from large teams
of scientific and industrial researchers working toward specific
goals. Some problems are best suited for a single expert researcher,
but most of the problems are multidisciplinary, and need input
from persons in a wide variety of disciplines.
Why is Canadian technology popular for heavy and extra-heavy
oil development around the world?
Canada, especially Alberta and to a lesser degree Saskatchewan
and the federal government, have invested billions of dollars
into heavy oil and oilsands technologies. Direct funding from
the provinces, industry, and the federal government is only
part of it. Many academics in Canada have dedicated large amounts
of time and public facilities to research and education as
well.
Canada was the first country in the world to produce over
a million barrels per day of heavy oil and synthetic crude,
and that level continues to increase. Other countries are interested
because we do it best, thanks to the huge investment, stable
government, and industry commitment to research and field trials
for over 30 years. What has happened in Canada is a model for
other countries.
Jim Boucher
Chief
Fort McKay First Nation
Why you need to know him:
About 65 kilometres north of Fort McMurray, the approximately
500-strong community of Fort McKay is surrounded by oilsands
and oilsands-related development. Under the leadership of Jim
Boucher, who became chief in the 1980s, Fort McKay has become
actively involved in industry, from reviewing project applications
to supporting development through its limited companies, which
generated about $85 million in revenue in 2006. Boucher has
also been chair of the Athabasca Tribal Council for over 11
years.
What role does the Fort McKay First Nation play in the oilsands
industry?
We have two roles. One is oversight with respect to projects,
looking at applications and their impact on lifestyle, animals,
and the environment within our region. We have built up our
capacity so that we can be engaged and represent our interests.
As a result of that, we have developed relationships with industry
and government.
The other role is a support function. We have developed our
own people so that we have education systems and ways to be
involved in the resource extraction industry. In the future,
we plan to develop our own resources in a partnership with
Shell Canada.
Why has Fort McKay taken this approach to development?
We used
to have a thriving economy from trapping. Our people used
to make a substantial amount of money on a yearly basis,
until the anti-fur campaign successfully drove down the price
of fur. We had to find another way to make a living. At the
moment, the oilsands is the only game. We’ve had to change
the way we work in our community, but it has come at a cost,
of course. We work with industry and government to reduce impacts.
Certainly we want to be leaders in the way we develop our resources
and how it disrupts the environment.
How can Fort McKay ensure its sustainability long into the
future?
That is one of the foremost questions not just for Fort McKay,
but also for other communities. We need to situate ourselves
so that we have future economic opportunities as the oilsands
industry dissipates. It is very incumbent upon us that we prepare
for that event. We need to continue to develop educational
and economic models to continue to be self-sufficient in the
future.
Neil Camarta
Senior vice-president, oilsands
Petro-Canada
Why you
need to know him:
Neil Camarta has earned a prominent spot
in the who’s who of leaders in oilsands development.
Long before “megaproject” became a buzz word, Camarta
led the mammoth $6-billion Athabasca Oil Sands Project from
planning to start-up. Today, the man who invented his own language
to describe oilsands project management leads Petro-Canada’s
oilsands portfolio.
Why do
you call the oilsands industry a “sausage factory”?
Building
these megaprojects is like linking sausages. You have to
approach things in bite-sized, manageable pieces. But
it’s also important to continuously plan for the next
phase, and then the phase after that. That way you minimize
execution risk by pre-building to keep costs down and retaining
an experienced workforce. These projects are elephants, but
by linking the sausages, we can wrestle them to the ground.
Where do you see the oilsands industry in 2015?
For one
thing, our Fort Hills mining project should be into its second
or third phase by then, producing up to 350,000
barrels per day of bitumen. At MacKay River, we’ll be
up to 70,000 barrels per day, and our other in situ prospects
will be well along the planning curve. So Petro-Canada will
be in a great position in 2015.
As an industry,
I think oilsands will play an increasingly important role
to 2015 and for decades beyond. These are the
ultimate long-life resources. Conventional crude sources are
in decline, including here in western Canada. Supply has to
come from somewhere, and the most secure and reliable source
right now is Alberta’s oilsands. There are projections
out there calling for three million barrels per day of oilsands
production by 2015, and I think that’s achievable.
What will it take to get there?
We’ve got some work to do on things like water supply
and regional infrastructure, but collectively the energy industry
is working with governments and other stakeholders to make
sure we get things right. The most important thing for the
success of these large projects is great execution, and that
requires a predictable playing field. We’re willing to
step up to the plate on things like environmental sustainability,
but we need the certainty to make sound investments.
Dan Woynillowicz
Senior policy analyst
The Pembina Institute
Why you need to know him:
Since 2003,
Dan Woynillowicz has spearheaded the Pembina Institute’s
role in the review of proposed oilsands projects and in the
multi-stakeholder initiatives advocating the regional environmental
management and monitoring of the oilsands industry. He has
also delivered expert testimony on the environmental impacts
of oilsands development to provincial and federal regulatory
review panels.
How does the Pembina Institute define sustainability?
Our focus
is on sustainable energy solutions. This requires that we
produce and consume energy in a manner that ensures
economic, social, and environmental sustainability for our
generation and that of our children and grandchildren. We envision
a world in which our immediate and future needs are met in
a manner that protects the Earth’s living systems.
What recommendations does the Pembina Institute offer to the
heavy oil and oilsands industry to support responsible development?
Responsible development will require significant innovation
and evolution in extraction and upgrading. Oilsands companies
must acknowledge that the environmental impacts of their individual
operations contribute towards cumulative environmental impacts.
With this in mind, companies must evaluate whether and how
they can develop projects in a way that respects the limits
of environmental sustainability.
With the rate and scale of development, the technologies and
approaches of the 20th century are no longer adequate. Significant
step-wise changes in technology are required to dramatically
reduce the impacts on air quality, fresh water, the boreal
forest, and global warming.
What are your top two hot button issues relating to heavy
oil and oilsands?
One, action
on global warming. The governments of Alberta and Canada
have continually delayed imposing tough regulations
on greenhouse gas pollution. As Albertans and Canadians see
more global warming impacts—such as the spread of pine
beetle into the boreal forest and impacts to freshwater sources—there
will be growing pressure on both the oilsands industry and
government to actually start reducing greenhouse gas pollution.
Two, managing
the pace and scale of growth. Albertans are increasingly
concerned about the environmental and social implications
arising from the pace of oilsands development. At the heart
of the issue is the fact that the government doesn’t
have the policies and systems in place to manage the current,
let alone future, scale of oilsands development. There is an
urgent need to catch up to existing development and then get
ahead of future development to ensure public interest decisions
are being made.
Melissa Blake
Mayor
Regional Municipality of Wood Buffalo
Why you need to know her:
Melissa
Blake is the vibrant and determined voice of the main municipality
bearing the growing pains brought on by expanding
oilsands development. She leads the crusade to ensure that
there is enough regional infrastructure in place to support
the growing number of people required to quickly increase oilsands
production to meet demand. She also plays a key role in expressing
the community’s concerns about cumulative effects.
What’s
it like to watch Fort McMurray undergo such rapid growth?
I’ve got two minds on that, obviously. I’m inconvenienced
like everybody else when there are traffic delays and service
lineups. On the other hand, I am very excited that when we
get past those points of challenge, what kind of community
we’re going to have in the end.
We’re going from what I knew growing up—[a population
of] about 30,000 to 35,000, to 100,000-plus in the next five
years. That’s a significant change in the community.
What does a sustainable oilsands industry look like to you?
It’s something that’s
well planned out and you know what the impacts are going
to be before you put your shovels
or pipes into the ground. The end result is already predetermined
before you start, which means reclamation efforts are built
into the planning.
The other
really important thing is to look at the cumulative effects.
So, we don’t look at individual applicants.
We look at the multitude of projects that are happening. And,
again, having that end-state base plan in place and the compliance
to ensure that we’re not exceeding the thresholds related
to air emissions, terrestrial disturbance, or water use. So
we would have an informed picture of what it would be like
and manage against what the thresholds would be. And I’m
just not sure we had enough of that information on the cumulative
impact.
What would
you identify as the Regional Municipality of Wood Buffalo’s
most important mandate?
Balance.
I say that because there are so many things coming at us.
What we learned in the last election is the fact that
we had been putting off our quality of life projects for fire
halls, roads, and services. People said, “Enough’s
enough. I’ve been here for X number of years. I’ve
got kids and they should have the ability to not have to play
hockey at 10 o’clock at night.”
We need
to look at our budget again and make sure we’re
balancing all those growth items with quality-of-life items.
To support our long-term vision, we created an initiative called
Future Forward. It allows us to look beyond the bumps in the
road.
Kirk Bailey
Executive vice-president, oilsands
Suncor Energy
Why you need to know him:
What can new oilsands producers learn from Suncor?
Maintain a dual focus. Growth is important, but so is the
foundation on which growth is built. So while pursuing major
expansion projects, always keep a firm eye on the health of
existing operations. Both must excel for your company to succeed.
Keep the
lines of communication open—listen to your
employees, consult your stakeholders, and understand your customers.
Be open and honest. Be prepared, but also be open and transparent
about the challenges and how you are tackling them. This will
build credibility with your stakeholders and instill confidence
in your investors and customers. You’ll need both when
things go wrong (and they will).
What is the biggest challenge Suncor faces as it continues
to expand?
Recruitment
and retention. The issue of workforce shortages affects everyone,
from the corner grocer to the largest corporate
or government employer. Unless we plan wisely, the oilsands
industry’s huge demands for skilled labour could exacerbate
the situation across the economy.
To minimize our impact on other employers, Suncor is committed
to doing its hiring as systematically possible. The company
is also acting to relieve regional labour pressures by shifting
more work off-site.
To increase the labour pool, both for our own company and the
broader economy, Suncor has strategic partnerships with several
post-secondary institutions, including a $3-million investment
in a major initiative at the Northern Alberta Institute for
Technology.
Whenever possible, Suncor prefers to hire locally. The company
supports several training programs at Fort McMurray’s
Keyano College and is a key participant in the Alberta Aboriginal
Apprenticeship Project.
Are there any misconceptions aboutthe industry you would like
to address?
There is
a misconception in some quarters that the oilsands industry
is interested only in growth—and at any cost.
This is simply not true.
Yes, the oilsands industry impacts the environment. But we
work hard to mitigate those impacts, and with considerable
success.
By harnessing technology to improve overall energy efficiency,
Suncor has significantly reduced its greenhouse gas emissions
on a per-barrel basis. We have similarly reduced the intensity
of our water consumption.
Suncor, along with industry partners and governments, is working
to develop carbon capture and storage, and we continue to invest
in other new technologies, including gasification and geothermal
energy. These investments would be impossible without the revenues
generated by a sustainable oilsands industry.
Some critics
say today’s environmental challenges are
too great and so oilsands development should be slowed or halted.
Then again, a decade ago, many suggested that the industry
as a whole could never be made economically viable. Through
good planning and the innovative use of technology, we proved
the skeptics wrong. The same strategies, we believe, will allow
us to demonstrate that energy development and environmental
excellence can proceed in tandem.
Oilweek
Magazine is Canada's oil and gas authority. Published monthly. Its
views are not necessarily those of PETROLEUMWORLD.
