Whitecap wants more CO2 for Weyburn EOR

One of the key questions regarding the future of coal-fired power generation in Saskatchewan is the future of carbon capture and storage.

For there to be a future, such as an expansion of the Boundary Dam project, there has to be a willing buyer of the additional captured CO2. Who would that buyer be?

Whitecap Resources Inc. is interested, CEO Grant Fagerheim told Pipeline News on September 19. Indeed, he had just been to Regina to talk to government ministers about that exact issue.

Whitecap is the operator of the Weyburn Unit, a medium gravity oil project that commenced operations in the 1960s and has been CO2 enhanced oil recovery since 2000.

The Weyburn Unit is currently the sole purchaser of the CO2 coming out of the Boundary Dam Unit 3 Integrated Carbon Capture and Storage Project, at the other end of a 71-kilometre pipeline.

“We want to continue to expand out the Weyburn project area…. That means we need more CO2, not less,” Fagerheim said.

“We need long-term security of supply.”

Whitecap is looking for more certainty on CO2 from Regina and Ottawa, he said.

“This back-and-forth between the provincial and federal governments – they can’t plan, we can’t plan. We would like to advance…. We’re talking about an incremental $2 billion of capital to expand that,” Fagerheim said. That would be Whitecap’s investment for their end, not SaskPower’s.

“We want to continue to advance, and I think we can make some headway. The challenge [Saskatchewan has] right now, and I’m sympathetic to it, is that the federal government has said, ‘No more coal, no more coal,’ he said.

“Wait a second. If it’s responsibly developed, and we’re using the most advanced technologies available, what do you mean, shut down coal? Why would you shut down coal, with the recovery factors we’re getting today?”

He went on, “We’re using it to demonstrate. The Chinese are coming over to see us. The Qataris. The Saudis. The Kuwaitis. They’ve all be to see us here in the last six months. Yet you’ve got these federal government policies, saying, ‘No more coal, no more oil, no more natural gas.’ You can’t create energy out of Pixie Sticks.”

He said major companies are looking at carbon capture opportunities, and that includes interest from at least one other company in southeast Saskatchewan.

“We’re getting inundated all the time with potential to team up with other opportunities. I don’t think funding would be a problem. We want to expand the project area.”

The company would need a minimum 15 years of CO2, on top of what it has in place right now.

“Either we get it from there (Estevan) or we’re looking cross border as well. We’re looking at North Dakota. We’re looking at Wyoming as well, [but] why wouldn’t we do what’s best for Canadians? Right here. Job creation, opportunities, CO2 sequestration, advancing the largest project in the world,” Fagerheim said.

He said the Saskatchewan government is being very supportive with open communication, trying to do what’s best for the residents of Saskatchewan. Alberta Premier Jason Kenney is doing the same in Alberta, Fagerheim added. “We think the two provinces are very welcoming.”

Whitecap’s 2019 production guidance is 70,000 to 72,000 barrels of oil equivalent per day, company-wide, of which 85 per cent is oil and natural gas liquids. Their September 2019 corporate presentation notes their southeast Saskatchewan assets, the Weyburn Unit (which uses CO2-enhanced oil recovery), has recovered 33 per cent of original oil in place. It has a possible recovery factor of 47 per cent. The reserve life is expected to be in excess of 40 years.

— Pipeline News

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