Oil sands players are focusing most of their investment in technological innovation on mitigating extraction and other operating costs.

A number of existing and proposed projects are introducing variants on the traditional mining and in situ extraction methods, which are anticipated to reduce operating costs and decrease the environmental impact of operations. Most producers’ primary objective, particularly for in situ projects, is to lessen reliance on natural gas. A number of techniques have been developed:

• Toe-to-Heel Air Injection (THAI™) – The THAI process ignites oil in the reservoir and creates a vertical wall of fire moving from the toe of the horizontal well toward the heel, which burns the heavier oil components and drives the lighter components into the production well. By creating heat in situ, the process requires no steam injection from the surface. The process has the potential to upgrade the bitumen in the reservoir; it could therefore substantially reduce production and capital costs, minimize usage of natural gas and fresh water and significantly lower greenhouse gas emissions. A study of the THAI injection method utilized by Petrobank at its Kerrobert project suggests that the recovery factor for proved plus probable reserves rises from 10 percent to 26 percent with the use of the technology.[1]
• Asphaltene Injection – This technique uses asphaltene residue from the upgrader to produce the gas needed to generate steam and to power the upgrader as well as hydrogen required to feed the hydrocracker unit, the net result of which is a reduction in overall operating costs. This method is primarily associated with the Opti-Nexen Long Lake project, but a variant of this technology is expected to be deployed in the Synenco-Sinopec Northern Lights project.
• VAPEX™ – This process is very similar to SAGD whereby two parallel wells are drilled. Where SAGD injects steam, VAPEX injects a vaporized hydrocarbon solvent such as ethane, propane or butane into the oil sand deposit, along with a displacement gas to thin the bitumen and allow it to be pumped to the surface. VAPEX burns no natural gas and requires no water processing or recycling. Its carbon dioxide emissions are lower and it can be operated at reservoir temperature with little to no heat loss. Devon Canada Corporation has been conducting field trials with the participation of the Alberta and Federal governments to develop and test the technology. N-Solv technology, similar to VAPEX, uses a solvent-based process that could potentially reduce capital costs by up to 50 percent and energy costs by up to 85 percent when compared to other in situ methods like SAGD.
• Heavy Oil to Light Oil Upgrading Technology (HTL™) – In 2005, Ivanhoe Energy Inc. acquired the patented process for Rapid Thermal Processing (RTP™) and applied this process to upgrade heavy crude and bitumen. The upgrading process occurs at moderate temperatures, at atmospheric pressure and in the absence of air, to rapidly convert feedstock to high value output by using hot sand to facilitate thermal cracking. The end product requires no diluents or blending agents for pipeline transportation. The process has been successfully tested at a commercial demonstration facility in Bakersfield, California. It is hoped that HTL™ will solve some of the technical problems associated with traditional upgrading technologies and protect the producer from price fluctuations in blending agents and natural gas—all at a lower cost than traditional upgrading technologies. HTL™ will be employed at Ivanhoe’s Athabasca interests.
• Mobile Ore Preparation Equipment – In its estimated $4.4-billion Voyageur South oil sands expansion, Suncor Energy Inc. is expected to use mobile ore preparation equipment instead of the current truck and shovel system. With the new technology, ore is fed with a shovel directly to a mobile ore preparation system that crushes the ore and drops it onto a portable conveyor system where it is then transported to a slurry facility that blends the mined product. From the facility, the blend undergoes hydro-transport through a pipeline that begins to separate the oil and sand through churning action as it makes its way to the central bitumen processing plant. Although costly, one of these machines can replace 15 mine trucks. This is expected to reduce the size of the mine-hauling truck fleet required to transport ore, which in turn reduces air emissions, noise pollution and the number of workers needed for transport.[2]
• Liquid Addition to Steam for Enhanced Recovery (LASER) – After conducting pilot projects since 2002, Imperial Oil Ltd. began phased integration of LASER technology into their commercial operations at Cold Lake. LASER involves injecting light oil into the production well with the steam to enhance recovery, as compared to steam injection alone.
• Solvent-Aided Process (SAP) – SAP involves a small amount of hydrocarbon solvent being added to the injected steam during SAGD. The solvent dilutes the oil to reduce its viscosity over and above what is accomplished by heating alone. Cenovus is planning to employ SAP to boost production at its proposed Narrows Lake project.

Investment in technological improvements has been critical to the viability of the oil sands industry. Our expectation is that innovation will continue to be focused on reducing reliance on natural gas, enhancing the efficiency of the upgrading process and mitigating environmental effects of both extraction and upgrading.