Trade show proves size matters for oil sands players
The resource is huge, but so are the challenges facing the sector and the Fort McMurray region
Greetings from wet, overcast and chilly Fort McMurray, where fall is in full swing as the community hosts its annual oil sands trade show.
This is my first trip to the two-day event (and my second visit to Fort Mac – the first came in 2004).
And while I can’t vouch for how much the conference has changed in recent years, the community that hosts it certainly has since I spent a week here eight years ago.
There are houses, a massive bridge and other pieces of infrastructure in spots that were empty save for weeds and trees during my last visit. And with oil sands projects representing 750,000 barrels per day of production currently under construction in the region, if it takes me another eight years to make it back here, I probably won’t recognize the place.
But when a community, and a sector, grows like that, challenges crop up. As Don Scott, MLA for Fort McMurray-Conklin said in an opening address this morning, “the concepts that make sense everywhere else in Canada don’t necessarily make sense here.”
It’s clear from the sessions I took in today that the oil sands industry, Fort McMurray civic and business leaders and its residents are still trying to make sense of what is going on.
And if there was a theme the speakers at today’s panels espoused, it was how to bring more order and efficiency to a sector that came be summed up in one word: huge.
That goes for the size of the resource, the costs and labor required to extract it and its environmental footprint. For those involved in the industry, the challenge is how to produce the resource and take some of the hugeness out of the challenges.
Progress is being made, but it may not be coming fast enough.
No nukes, still?
I thought this idea was dead, but today’s conference included a presentation by Chris Godomski, energy analyst with Bloomberg New Energy Finance about the future of nuclear energy in the oil sands.
We’ve examined this issue in the past. There never was much appetite among Albertans to see nuclear power fuel oil sands growth, and that was before the Fukushima disaster and the bottom fell out of natural gas prices.
But Godomski, an American who says he’s had a keen interest in Canadian energy issues for 30 years, says nuclear could play a role in the oil sands story.
The role could come about because of what Godomski refers to as Alberta’s “CO2 habit.” He says as oil sands production grows, demand for natural gas will grow with it.
And while the fossil fuel burns cleaner than coal or diesel, it still emits CO2. And as the industry faces costs to reduce its carbon emissions in the future, that makes nuclear power an attractive option for oil sands producers, according to Godomski.
It also helps that technology is out there to build smaller reactors that cost much less and don’t take a decade to be built.
However, Godomski admits public opinion, not economics will win the day when it comes to employing nukes to power oil sands production. “Does Alberta want to become part of the nuclear party,” Godomski asked his audience Tuesday afternoon.
I think the answer to that question is still a resounding “no”.