Canada’s Oil Sands Innovation Alliance CEO Dan Wicklum on the Inevitability of Carbon-Neutral Oil
COSIA CEO Dan Wicklum explains why he believes a carbon-neutral barrel of oil isn’t just theoretically possible—it’s coming.
Back in 2012, when scarcely a dozen oil sands firms accounting for almost 90 percent of all oil sands output formed Canada’s Oil Sands Innovation Alliance (COSIA), they changed the industry forever. This is not hyperbole. By moving from competition to collaboration to lighten their environmental footprint, COSIA slashed mining operators’ water use by 30 percent in its first three years.
COSIA allocates research stakes to its member companies in proportion to their production volumes, and collects contributions to its own projects using the same ratios. Sharing practices and technology cuts out duplication, slashes development costs, and each firm gets farther ahead faster than it ever would alone. One of COSIA’s aims today is to bring the oil sands down to carbon emissions parity with other sources of oil around the globe—and then some. It’s an astounding target considering where oil sands producers began. And while many of those producers still have a long way to go, it’s a far less daunting task when you know where you’ve come from—and that you don’t have to do it alone.
COSIA CEO Dan Wicklum explains why he believes a carbon-neutral barrel of oil isn’t just possible—it’s inevitable.
Can you give an example of how collaboration cuts costs and reduces the collective environmental footprint of oil sands operators?
Water technology’s always been an issue, so COSIA is building the Water Technology Development Centre where operators can test drive their technologies, while sharing the risks and costs. This will accelerate the development and implementation of new water treatment technologies. The average current timeframe to field test technologies and take them to commercialization is eight years. The center will cut this time and improve the return on investment. It will be attached to Suncor Energy’s Firebag facility, which uses in situ technology SAGD. Testing facilities is a key strategic upside to COSIA, so one can test, all can benefit. Each company can test one technology but gets the results of all 13.
You have an ambitious target for slashing greenhouse gases involving the COSIA Carbon XPRIZE. How does something like that the help the cause?
We are jointly sponsoring it with an American company. This competition will last nearly five years to award $20 million to the team that develops a process that captures the most CO2— from either the Integrated Test Center in Wyoming or a natural gas plant in Alberta—and converts it into a valuable product. But the team must also develop a sustainable business model. The competition will produce a suite of technologies, not just the winner’s. We’ve taken a grand challenge—carbon emissions—and put a target on it. We don’t really know who can solve the problem, but we open it up to everyone. And we’re not just rewarding an idea, we’re rewarding a real solution.
If non-COSIA members invent a technology that might help the oil sands producers, are they allowed to test it at your members’ sites?
If a third party has proprietary technology we can test it and they can share the test results. This is good for them because the key users see it immediately. COSIA is open to any company; it doesn’t have to be a member. We have a completely open policy. If a third party has a stake in something, it can test the technology with a COSIA member. It can then enter commercial terms with COSIA members, if it chooses.
Developing technology is one thing, but deploying it is what matters. How do you ensure that new technologies actually make it to the oil field?
Technologies being acted on is a metric we use. In the four areas we target—water use, land management, tailings and GHGs—we have shared 819 technologies and 347 implementation decisions have been taken. We measure water use, for instance. Our goal is to cut its intensity by 50 percent by 2022. By 2015 we had already cut mining’s net water use by 30 percent. Our core mandate is to discover, demonstrate and deploy.
Radio waves to melt bitumen, centrifuges to remove water from tailings ponds, etc. Will we see major breakthroughs on these and similar technologies or will improvements remain incremental?
The oil sands industry has invested billions of dollars in the deployment of commercial-scale technology to manage tailings. Some of the challenges in moving from technological development to implementation are the large scale of operations, and ensuring that technologies selected lead to desired outcomes. Industry collaboration through COSIA has so far facilitated the sharing of 132 technologies specifically for tailings management at a cost of $665 million. An impressive achievement was the opening of Syncrude’s $1.9-billion full-scale centrifuge plant aimed at speeding the release of process water from fine fluid tailings, accelerating tailings reclamation and minimizing tailings pond size. By sharing its centrifuge technology through COSIA, Syncrude helped Shell deliver similar technology in a more timely and cost-effective manner. At its Jackpine mine, Shell commissioned a commercial-scale demo plant [with two centrifuges] in 10 months. The project was so successful that Shell was able to rapidly commission two more centrifuges at Jackpine. Now a total of four centrifuges will be used to assess the technology’s applicability for commercial installation at Shell’s Muskeg River mine.
A University of Waterloo study found that a carbon-neutral barrel of oil is technically possible. Is this a realistic proposition or just another pie-in-the-sky hypothesis?
It’s absolutely realistic. When you look at the work that COSIA and Canada have done on carbon capture and storage (CCS), the technology is there. It’s not cost-effective at this point, but it’s absolutely real in my mind. Given the trend of technology in general, a carbon-neutral barrel of oil is inevitable, not just possible.