Three new methods of in situ bitumen production are either waiting funding or industry partners for further development or commercialization, company executives said Wednesday.
Each method -- Siemens AG's electric heating, Excelsior Energy Limited's in situ combustion and Osum Oil Sands Corp.'s underground drilling rigs -- was discussed in presentations at Tulsa, Oklahoma-based PennWell Corporation's Oil Sands and Heavy Oil Technologies Conference in Calgary.
About a year ago Siemens told the Daily Oil Bulletin (DOB) it was talking to oil companies about the possibility of testing its technology in a bitumen reservoir. One small oilsands company was using Siemens' name in its public statements. But the technology giant said that while it was talking to potential partners, no contract had been signed.
The Erlangen, Germany-based multinational is still talking to Canadian oilsands operators, but doesn't yet have a contract to test its technology in a bitumen reservoir, Bernd Wacker, Siemens' head of onshore oil and gas technology and innovation, told the Bulletin after his presentation at the PennWell conference.
Siemens hopes to commercialize its technology within the next two or three years. But the company is solely a technology provider, not an oil and gas producer. It does not own any oil and gas leases and doesn't plan to become a bitumen producer.
So to do a full field test, it needs to partner with an oilsands firm. Siemens hopes to sign such a contract by year's end, which would enable it to pilot the technology next year or in 2012, Wacker said.
He said the electromagnetic heaters were tested underground in Bavaria, Germany where the geology and conductivity are similar to Alberta's oilsands region -- except there was no oil or gas present.
Using electric heat to melt the bitumen would eliminate the use of water to make steam and also the consumption of natural gas to boil water.
Wacker said the electromagnetic heaters could reduce energy consumption by 20%, which would reduce carbon dioxide emissions by at least that amount. He said nuclear or wind power would reduce CO2 emissions to zero.
Siemens believes the electromagnetic (EM) heaters could be added to an existing steam assisted gravity drainage (SAGD) operation to create a hybrid process called EM-SAGD. Wacker said there is no risk of EM technology reducing SAGD oil production, but an opportunity to increase it.
Two other companies have already tested in situ electric heaters in Alberta bitumen.
Royal Dutch Shell plc ran technically successful tests which not only mobilized -- but also upgraded -- bitumen in the Peace River oilsands. Shell was preparing to pilot the technology in the Grosmont bitumen carbonates but put those plans on the back burner after the September 2008 financial crash.
And privately held E-T Energy Ltd. has intermittently field-tested its electric heat process in 100-metre vertical wells over the past few years. This technology targets bitumen deposits that are too shallow for SAGD but too deep for Fort McMurray-style open-pit mines.
Excelsior, meanwhile, plans to put its heat source right in the reservoir. It will use in situ combustion -- which burns a small amount of bitumen in the reservoir -- to heat nearby bitumen so it will flow to production wells.
Petrobank Energy and Resources Ltd. is still attempting to achieve sustained, commercial production volumes from its in situ bitumen combustion method -- called Toe to Heel Air Injection, or THAI (DOB, June 16, 2010). But Excelsior is using a different method.
Excelsior's version of in situ combustion is called combustion overhead gravity drainage, or COGD. A well pattern, or "network," would consist of a horizontal drain well completed low in the reservoir and an array of vertical air-injection wells positioned above the horizontal drain.
Melted bitumen would flow with gravity down to the horizontal drain well. Vent wells would be drilled on the flanks of the combustion zone and observation wells would monitor temperature. Each well pattern would service a reservoir area of 150 by 500 metres.
Excelsior plans to initially develop a one-pattern pilot on its property at Hangingstone in northeast Alberta. If operating results suggest changing the well layout could increase bitumen recovery, the company may develop one or two more well patterns, but only one will operate simultaneously during the pilot.
The company is currently awaiting a decision on its regulatory applications, which were filed with the Alberta Energy Resources Conservation Board and Alberta Environment in June 2009.
Once it has regulatory approval, the next obstacle will be raising the estimated $50 million required for the proposed experiment, which would operate for four years.
Last year, Excelsior hired CIBC World Markets Inc. to help it find a major joint venture partner to help fund the project (DOB, Nov. 17, 2009).
Excelsior is still looking for a partner, Robert Bailey, the company's vice-president of engineering, told the Bulletin.
With $50 million and regulatory approval, the project would be a go, but it's impossible to predict how long it will take to raise the financing, he said.
Osum, meanwhile, plans to combine mining and SAGD technologies with its underground drilling rigs. While the underground-rigs concept hasn't been tested commercially, its technical feasibility was proven at the Underground Test Facility, where SAGD was developed late last century.
The Underground Test Facility was started in the mid-1980s by the Alberta Oil Sands Technology and Research Authority (AOSTRA), an Alberta government/private-sector partnership that played a key role in commercializing the oilsands.
Putting rigs underground is a long-term goal for Osum. In the short and medium term, the company plans to use standard thermal technology in the commercially established Cold Lake oilsands region of northeast Alberta.
Osum will also use standard drilling technology in a pilot test planned with Laricina Energy Ltd. in bitumen-bearing carbonate rock at Saleski, about 120 kilometres west of Fort McMurray. So far, no one has achieved commercial production from Alberta's vast bitumen carbonate deposits.
Though Osum has raised at least $375 million for its projects using established technologies, Alan Abrams, the Osum vice-president responsible for the underground rigs project, said his personal opinion is that will have to be jointly developed by government and industry.