The opinions expressed are those of the author and do not reflect the official position of CMC Research Institutes or its board.
The next industrial boom in Alberta & Saskatchewan might be focused not on pulling carbon out of the ground, but on putting it back.
As Canadians we ought to be proud of stepping up and breaking ground with the SaskPower Boundary Dam project in Saskatchewan and the Shell Quest project in Alberta. Within the next couple of years we will see the Northwest Refinery/Enhance/ Alberta Carbon Trunk Line project commissioned. This latter is, in addition to demonstrating capture and storage through Enhanced Oil Recovery (EOR), establishing a 240 km backbone of a new CO2 management hub capable of handling about 40 million tonnes of CO2 per year, connecting many sources and users of CO2 from the Heartland to near Lacombe, Alberta (See Figure 1).
These three projects have clearly brought Canada unprecedented credibility internationally in the fields of capture (the Boundary Dam project uses Canadian developed Shell CanSolve process), the use of recycled CO2 for Enhanced Oil Recovery (EOR) at Cenovus’ Weyburn field in Saskatchewan, deep injection of CO2 into saline aquifers at Aquistore in Saskatchewan, and for the Quest project.
Possibly the next biggest advantage we have in Alberta derives from the early investment in demonstration projects. These projects created an impetus for Alberta, then Saskatchewan, to put in place the necessary legislation and associated regulations to dramatically reduce the uncertainty facing any industrial developer looking to undertake the next deep storage or EOR projects.
Now B.C. is developing a CCS regulatory framework. In fact, the Global CCS Institute in their recent Global Status of CCS – 2015 report places Canada and the U.S. as the two leading countries for both inherent CCS interest and enabling policy/legislation.
It is often said that the cost of capture makes CCS uneconomic. However, that is based on the estimated cost of post-combustion capture from coal-fired power plants using first generation technologies. Because of the variety of sources in Alberta the cost of capture may range from very low to very high. The most cost-effective example of capture lies in natural gas processing facilities where CO2 is already being stripped out of the gas to bring it to “pipeline spec”. In the mid-cost range are hydrogen production technologies just arriving on the market to capture from boilers, while in the high-cost range is direct capture from air.
Capture innovation advancing rapidly
Innovation in the field of carbon capture is moving at a dizzying pace, with technology developers from around the world looking for suitable sites to build their first demonstration projects for next generation capture technologies. But capturing CO2 is only half the job. Like the dog chasing cars, what do we do once we catch it?
We have in abundance in Alberta and Saskatchewan, but also to some extent in B.C., great geology for safely and permanently storing CO2.
In fact the three Western provinces have, very conservatively, sufficient storage capacity for nearly a thousand years of capture from all current large stationary sources (See Table 1). While ongoing work continues to increase this total for conventional storage, researchers are working to prove new mechanisms to store large volumes of CO2.
The best part of this geology is that it can’t be exported or licensed to overseas manufacturers. If plant developers want to take advantage of this great geology they will need to bring their industries to Alberta. We have the engineering expertise, fabrication facilities, and industrial construction experience to build global scale industrial projects, as well as solutions to their emissions concerns.
Skilled experts available
On top of that we have the legacy of over a century of oil and gas development. We have an abundance of the world’s best geoscientists, engineers, oilfield services companies, instrumentation experts, modelers and more. These are the same people who are being downsized due to the downturn in the petroleum sector and have exactly the skills needed to develop a world class carbon storage industry.
The statement “Technology leads policy leads investment” is true. We have proven the first generation of technology and established the basic enabling policy. Now it is up to us to establish the suitable policy incentives to create a market and attract the investment this incipient industry needs to develop.
So how might we go about growing a carbon storage industry, and set in motion the next boom in the context of a tight economy and elevated ambition to achieve climate targets?
Demand will create market
I suggest that because of the diversity of potential sources it is easier to incentivize the storage end of the process and let demand build a market for sources of CO2 for these projects. Let the marketplace find the most cost effective sources first and let technology developers feel an incentive to drive the cost out of capture.
By creating the enabling conditions for the industry, this region will become the most hospitable place in the world to develop and demonstrate technologies and methods associated with CO2 capture, collection, processing, transmission and distribution. Because of all of this enabling activity and expertise building up around it, the next generation of solutions, such as conversion of CO2 to other materials, will have a natural home to build and grow.
But then what? This is not just about dealing with Saskatchewan and Alberta’s existing emissions from our legacy industries.
If markets are demanding lower life cycle carbon emissions, either through pricing or market access barriers, then instead of seeking the lowest labour costs, these high emitting industries will be looking to jurisdictions that enable them to serve their markets while eliminating greenhouse gas emissions. Alberta and Saskatchewan are perfectly situated to attract carbon emissions refugee industries AND supply them with their key feed stocks, such as natural gas.
Over the next few decades, if we’re smart, we can re-orient ourselves to take full advantage of the opportunities presented by a decarbonizing world. We don’t need to retrain our workforce or turn our backs on the industries that have brought prosperity to our economies for the past century. We need to build on them and put them to work creating the most attractive jurisdiction in the world to address industrial greenhouse gas emissions.
About the Author
For three decades Richard Adamson has facilitated the commercialization of innovative technologies. As CMC’s first President, Richard has been driving solutions to industrial greenhouse gas emissions through the global research network. He was recently honored to work with CMC’s Low Carbon Pathways group on the Canadian chapter of the international Deep Decarbonization Pathways Project.