Suncor plans $20.6 billion oil sands expansion
Suncor Energy Inc., Calgary, is planning to invest $20.6 billion (Can.) to expand the oil production capacity at its oil sands operation north of Fort McMurray, Alta., by 200,000 b/d, to 550,000 b/d in 2012.
The expansion includes constructing four additional stages of in situ bitumen production, a third upgrader to convert the bitumen into higher-value oil, and other facilities and utilities.
Of the total, Suncor has already invested $2.5 billion on detailed engineering, site work, and fabrication of major vessels for the expansion.
The expansion will be completed in a phased manner, with mechanical completion of the new upgrader scheduled for 2011 and bitumen feed from the new stages of in situ production to begin operation in 2009-11. Crude oil production is expected to begin ramping up in late 2011, with full production capacity slated for 2012 if all regulatory approvals are received promptly.
Suncor Energy plans to double its oil sands production to more than 200,000 b/d in the next decade from its plant north of Fort McMurray, Alta. Photo from Suncor.
About $9 billion will be invested to construct four stages of in situ bitumen production. Each stage will produce about 68,000 b/d of bitumen. Depending on operational and market conditions, excess bitumen may be sold as a heavy crude blend, Suncor said.
About $11.6 billion will fund construction of the upgrader to process 245,000 b/d of bitumen into 200,000 b/d of crude oil. The product slate is expected to consist of 85% sweet crude and diesel and 15% sour crude. Oil products will be shipped via third-party and Suncor-owned pipelines.
Ancillary facilities include pipelines, camps, administration facilities, cogeneration, tank farms, and a highway interchange. Another $800 million is being spent to reduce sulfur dioxide emissions through the construction of a new sulfur plant. Commissioning and start-up are expected to cost another $820 million.
Suncor said the project is designed to mitigate many environmental impacts of oil sands development, particularly water management. The company said more than 90% of the water needed for the in situ process is recycled. Suncor has reduced water use per barrel by nearly 50% during the past 5 years and will spend $225 million to further improve water management.
The project also calls for emissions abatement equipment and sulfur handling systems to improve air quality and reduce odors, while new equipment and processes will improve energy efficiency. Suncor has reduced greenhouse gas emission intensity at its oil sands plant by about 50% from 1990 levels and is investigating carbon capture and storage to reduce absolute emissions in the longer term.
Improvements in emissions of nitrogen oxides are expected, and Suncor will investigate gasification options that could turn the byproduct petroleum coke into a clean energy source.
