Hot times at Cold Lake

It may not be considered ‘mining’ in the traditional sense, but Imperial Oil Resources’ Cold Lake in-situ oil sands operation in the heart of the Cold Lake Region of Alberta’s Oil Sands is certainly a mining project in its own rights.

To many hard-core miners, in-situ (meaning “in place”) development is not ‘mining’ per se because for one thing, there’s very little blasting involved and without that ingredient, anything else is almost like harvesting corn… it’s easy pickings.

Those in the know, however, will argue that there’s nothing ‘easy’ about extracting oil from the formations more than 400 m below the surface. In fact, there’s far more to it than simply digging it up and wringing out the oil, so to speak. Because the oil-bearing sands at Cold Lake are buried so deep, they’re not recoverable by conventional surface mining techniques. Instead, production is achieved through a series of wells drilled from the surface. To date, there are more than 4000 wells at the Cold Lake site.

The technologies involved equal and often surpass those required to process conventional minerals and Imperial’s Cold Lake development is a perfect example of modern technology at its best.

Because of the nature of the product and the harsh environment where it’s found, separating the oil from a sand mix is somewhat like taking the egg out of a cake mix. Once it’s blended, it’s almost impossible to remove.

That’s a graphic way of describing the process, but not far from the truth.

As every person who has been to Canada’s oil sands knows, the product is unlike any other found in mining. It’s heavy, sticky and it often smells awful. And it plays havoc with equipment too. It sticks to everything and everyone and worst of all, it’s tempermental. That’s right. It has a mind of its own and when it doesn’t want to be moved, it finds a way to resist.

Anyway, Imperial has been dealing with these many characteristics at Cold Lake since 1964 and as result; it has become one of the leading developers on the entire oil sands’ front.

In fact, because of its continuing commitment to oil sands development, many in the industry now consider the company to be the ‘leader’ because of its perseverance and devotion to the cause.

Unlike others involved with the oil sands recently, Imperial has not cut back on production and in fact; it’s now continuing to move ahead while many of the others have backed off.

And part of the reason Imperial is staying put is because of how much it has invested in its existing properties and how much oil still remains to be found in the ground.

With proven year-end (2008) reserves of more than 2.3 billion oil equivalent barrels, an increase of almost 50% from 2007, the company reports that its reserve life at current production rates is good for at least another 25 years.

But as mentioned earlier, these reserves and in particular production rates, did not happen overnight and one of the reasons for Imperial’s success can be attributed to projects like its Mahkeses plant located in the heart of the Cold Lake region about 250 km northeast of Edmonton.

The plant, one of the major components that help make the Cold Lake development one of the largest thermal heavy oil recovery operations in the world, is a $650-million facility that along with three other large plants recovered an average of 147,000 barrels of bitumen a day in 2008.

In addition to plant and field facilities for steam generation and bitumen production, the Mahkeses facility, the most recent addition to Imperial’s facilities at Cold Lake, includes a first for the company; a 170-mW electrical power cogeneration plant that produces enough electricity to power a small city.

Design of the power plant includes two 85-mW, General Electric Frame 7, natural-gas-fired turbines to generate electricity, while heat-recovery steam generators, called HRSGs, capture exhaust heat from the turbines to generate steam.

In all, Imperial’s co-generation system has enabled the company to enjoy higher overall energy-efficiency while at the same time lowering its costs by using this waste heat from the turbines to produce steam.

As a further bonus, the Mahkeses plant also includes electrical power transmission lines and other facilities necessary to transmit surplus electricity to the Province’s electrical grid.

More than 70% of the electricity generated by the plant is currently being used by Imperial Oil while the balance is being sent to Alberta’s power pool.

In addition to the new co-generation being used at Mahkeses, the site also features a new well pad that uses two parallel rows of wells instead of the traditional Cshaped configuration. This helps reduce the amount of surface land disturbance while accessing a larger area of the underground oil-sand reservoir.

More than 500 wells in the Mahkeses field area are directionally drilled from 21 such pads. Each pad also includes facilities to recover small amounts of natural gas produced along with the bitumen and water and ship this production steam to the plant by a network of above-ground insulated pipes.

The bitumen produced at Cold Lake has a consistency of very thick molasses at room temperature. It’s so heavy that it won’t flow naturally from the underground formations to the surface so Imperial Oil is using a process called “cyclic steam-stimulation” to heat and thin the bitumen so that it can produced through conventional wellbores.

Steam produced in large boilers at the central plant is carried through this pipeline network to where it is injected down the wellbores and into the underground formations at temperatures averaging 300 C and pressures averaging 1600 psi.

After a “soak” phase, which can last several weeks, the wells are switched from steam injection to production. This process uses periods of steam (usually four to six weeks) followed by periods of “soaking” (a further four to six weeks) followed by increasingly longer periods for production.

The duration of successive steam and production cycles increases over time, and later cycles can take two years to complete as the more distant reservoir is accessed.

To further describe the process, the heated bitumen and water is pumped to the surface where it is sent to a central plant where the water is separated from the bitumen, purified and softened using new technologies developed specifi cally for Cold Lake and recycled back into the steam boilers. The bitumen is blended with a light hydrocarbon liquid called diluents so that it can be shipped to market by pipeline.

In addition to the impressive production capabilities at the Mahkeses plant is the remarkable fact that more than four million work hours went into constructing the facility without a lost-time injury.

There’s no question that the Cold lake plants and their “cyclic steam-stimulation” processes are one of Imperial’s more glowing achievements in its oil sands’ developments, but the company is not stopping there.

Work is now underway on a number of reservoir processes to follow after “cyclic steam-stimulation” to increase recovery from areas that are already developed. Imperial believes the application of these “follow-up” processes will enable the company to improve its recovery rate to more than 30% from today’s level of about 25%. Encouraging results with horizontal and infill wells and the use of solvents to augment thermal recovery have already been reported.

An equally impressive note involving the “cyclic steam-stimulation” process involves the environment and in particular, water conservation.

The heart of the process is a massive water-processing operation requiring large quantities of water to generate the steam that heats and thins the bitumen in the reservoir. On average, about 600,000 barrels of water a day are injected into the underground reservoir in the form of steam. The vast majority (more than 90%) is returned along with the bitumen and ultimately recycled.

The remaining water stays in the
reservoir, taking up the volume of the bitumen produced. Through the years, Imperial says it has improved its ability to recycle water dramatically and its need for fresh make-up water today is about one-half of what it was when it first introduced its “cyclic steam-stimulation” system.

Fresh make-up water is still needed to replace that water that is trapped in the reservoirs, but instead of drawing solely from Cold Lake as it once was, much of the supply comes from “brackish” water wells; very deep wells that produce saline, non-potable water. Fresh water from the deepest aquifer in the area is used as a contingency supply during periods of low regional water levels.

On a final ‘environmental’ note, Imperial’s entire involvement in the oil sands focuses on a number of environmental-protection measures developed to minimize the impact of its operation on air, water and land.

Under the watchful eyes of federal, provincial and most certainly local authorities, the company has done extensive work and spent millions of dollars to better measure and control its greenhouse gases, manage its use of fresh water and finally, design its surface facilities to reduce the amount of land required for roads, well sites and central processing facilities.

Topsoil removal during construction is stockpiled for reclamation use and areas to accommodate the paths of steam and production lines are contoured and re-seeded to minimize the potential for erosion.

All in all, despite the bad rap that many producers in Canada’s Oil Sands are getting, there are companies like Imperial who are doing their best to make a challenging situation better.

Mining for oil, no matter how one looks at it, is a tough business.

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