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Extracting oil from Canadian sand pits


  • Photo 1 of 15

    Giant dump trucks carry 400 tons of sand a piece to a crusher at a nearby processing plant where the process begins to separate the oil from the sand.

    - Sean Cole/Marketplace

  • Photo 2 of 15

    The oil sands mines and production operations are in the midst of the boreal forest in northern Alberta, about 460 miles north of Calgary. Every major international and Canadian oil company is somehow involved.

    - Sean Cole

  • Photo 3 of 15

    Shell Canada has held a production lease on this land since 1956, but it didn't make first oil here until 2002. Albian Sands is mostly owned by Shell. Chevron and Marathon each own a 20 percent share.

    - Sean Cole/Marketplace

  • Photo 4 of 15

    An excavator loads 400 tons of sand into each truck per pass. The trucks then drive them to a crusher to begin the bitumen extraction process. This happens 40 times an hour.

    - Sean Cole/Marketplace

  • Photo 5 of 15

    Each truck can carry 400 tons of sand. The trucks then drive them to a crusher to begin the bitumen extraction process. This happens 40 times an hour.

    - Sean Cole/Marketplace

  • Photo 6 of 15

    The dump trucks at Shell Albian Sands have 13-foot high tires. This one set the project's record for longest life, lasting 9,855 hours. So Shell employees autographed it.

    - Sean Cole/Marketplace

  • Photo 7 of 15

    The view from Shell's tailings facility gives you a sense of what this mine used to look like. One day the land will have to be turned back into forest.

    - Sean Cole/Marketplace

  • Photo 8 of 15

    Shell uses a robotic falcon to scare ducks and geese away from the oily water of the tailings pond.

    - Sean Cole/Marketplace

  • Photo 9 of 15

    Devon Canada's Jackfish project is located about two and a half hours south of the oil sands mining area in Alberta. This is an 'in situ' project, meaning it extracts the bitumen that's too deep to mine.

    - Sean Cole/Marketplace

  • Photo 10 of 15

    In situ extraction looks less impactful than mining. But The Pembina Institute in Calgary says it may have more of an impact on the land, due to all of the pipelines and roads, etc., required for in situ development.

    - Sean Cole/Marketplace

  • Photo 11 of 15

    Surprisingly, most of what Devon does at its Jackfish site is process water to make steam. The teardrop shaped silo is called a hot lime softener, or HLS.

    - Sean Cole/Marketplace

  • Photo 12 of 15

    Devon uses only salt water in its production process. It gets the water from a brackish underground reservoir. Many in situ operations use fresh water in production.

    - Sean Cole/Marketplace

  • Photo 13 of 15

    Once the bitumen is pressured out of the ground, Devon adds a diluent to it so it will flow better in the pipeline en route to an upgrader farther south in Alberta.

    - Sean Cole/Marketplace

  • Photo 14 of 15

    In Devon's tap room, it can gauge the quality of the product at any stage of the process. This is bitumen mixed with the cutting agent that helps it flow.

    - Sean Cole/Marketplace

  • Photo 15 of 15

    A well-head like this one sprung a leak not long after our reporter's visit. It sent a steamy mist of water and bitumen about 36 feet into the air for 36 hours.

    - Sean Cole/Marketplace

TEXT OF STORY

Kai Ryssdal: From the bottom up, the top five sources of American oil imports are Nigeria, Venezuela, Saudi Arabia, Mexico. And in the number one spot: Canada. Twenty-one percent of all the crude we use comes from north of the border. About half of that from something called the "tar sands." Big oil and many Canadians prefer to call it the "oil sands." Whatever you call it though, it has also been called the world's dirtiest oil. The way things are going, 20 years from now, a full third of our imported crude could be coming from the sands -- oil or tar, take your pick.

That's why we sent Sean Cole about 500 miles north of Calgary to look what we do to fill our gas tanks.


Sean Cole: This is the sound of the biggest dump truck in the world.

Sound of dump trucks driving

Imagine a two-story house on wheels with a guy steering it from the upstairs bedroom. There are more than 40 of these things rolling along a sprawling strip mine cut into a boreal forest.

Trucks honking

Each can ferry 400 tons of sticky black sand from an oozy cliff to a nearby processing plant. The project is called Shell Albian Sands. Shell as in... Shell. I'm standing a safe distance away with one of the managers.

Cole: You can smell it.

Todd Dahlman: You can, yeah. You can smell the oil.

But it's not oil in the ground here. It's a hydrocarbon called bitumen that has to be processed into an oil equivalent, synthetic crude, using one of the most expensive and energy intensive processes in the world.

David Corriveau: The process requires a warm water process for the most part to separate it.

David Corriveau oversees the technical end of things at Shell Albian Sands.

Corriveau: It's much like a washing effect if you will.

Cole: It's like putting it in a washing machine.

Corriveau: Very much so, yeah. Yeah, exactly. And it can be a little... quite the stubborn stain if you're not careful so.

It takes two to four barrels of water to wring one barrel of fuel out of the sand. The water's heated with natural gas. This industry uses enough natural gas to heat two and a half million American homes a day. Almost every major international and Canadian oil company is somehow involved in the oil sands. After all, there are 170 billion barrels of proven reserves under northern Alberta, the largest petroleum reserve outside Saudi Arabia. The process of turning it into fuel would take the entire show to explain. It's a pain. Even the most loyal defender of the oil sands I spoke to had to level with me.

David Yager: Let's be honest about the oil sands -- this is the last place you wanna go.

His name's David Yager and he writes a column for Oil Week magazine.

Yager: I mean, why would you bother going to the middle of nowhere, and digging up sand and spending all this energy processing it.

And then he pretty much answered his own question.

Yager: You know, if we can go into Iraq without getting shot at, if you could go into Venezuela without getting nationalized.

Cole: Nigeria.

Yager: Yeah, if you could go to Nigeria, if you could go to these places, I suspect gasoline would be 50 cents a liter and oil would be 20 bucks a barrel.

Weirdly, it's the price of oil that governs these projects though, not the other way around. Oil has to cost a certain amount in the first place to make digging in the oil sands worthwhile. And that's just the economics. There is, of course, another kind of cost.

Yager: That developing the oil sands is environmentally hazardous?

Cole: Yeah.

Yager: Well, yeah. The Gulf of Mexico's not lookin' too s***-hot these days either. I mean, there's no such thing as clean oil. This is the absurdity of the debate.

And this is an intractable debate with agendas and spin on all sides. Everyone agrees oil sands production emits more CO2 than producing conventional crude oil, but people measure this differently. The Canadian government was looking into potential water effects, but finally scrapped the investigation and destroyed draft copies of the report. Local aboriginal groups have sued over land rights.

Andrew Logan: If the industry doesn't take steps to aggressively manage those risks, then the industry's long-term growth and perhaps existence is in doubt.

Andrew Logan works for Ceres, a network of environmental groups and investment funds. Ceres released a report back in March saying these ecological hazards could leech into the money side of things.

Logan: You know, the oil sands are extremely water intensive in a world that is dry and getting drier. They are carbon intensive in a world that is increasingly carbon constrained. If companies aren't considering these kinds of factors when they make their investments, these investments may turn out to basically not be profitable.

Now, Shell, for one, says it is considering these factors. And even Ceres will tell you Shell's done a lot to reduce CO2 emissions and that it recycles most of the water it uses. The rub lies in how that water is stored.

You know we haven't even addressed the issue of the tailings ponds.

I know, that's where I'm going next. Every oil sands mine keeps used water in a giant lake called a tailings pond. Tailings ponds are toxic. And just recently, oil companies were required to hand in specific plans for reclaiming them, which means turning them back into forest.

Logan: You know, the clean up of these things will end up on the balance sheet of these companies pretty soon. And it's gonna have a pretty significant financial impact on any company that has to clean up these ponds.

But there's a more immediate issue with tailings ponds. Ducks and geese can get fouled up in the oily water and drown. Thus, Shell is using the latest in bird-deterrent technology -- a robotic falcon and a sound cannon.

Recorded falcon cry and a sound cannon

Cole: And that scares away the birds.

Scott Wytrychowski: Yeah, the peregrine falcon is a bird of prey for the water fowl so they fear it.

Scott Wytrychowski is an environmental manager at Shell. He told me they lose fewer than 20 birds a year.

Wytrychowski: Our end goal is zero.

Cole: Zero birds.

Wytrychowski: Yeah, it's like safety -- we want to have zero incidents for safety for humans. It's similar to wildlife. Target is always zero.

Cole: But there are accidents.

Wytrychowski: Yup.

Cole: And there are birds who die.

Wytrychowski: Yes. Yup.

In fact, two years ago, 1,600 ducks died after landing on another company's tailings pond. Pictures from the incident are now plastered across billboards in four U.S. cities. And all of this isn't even half the story. In fact, it's one-fifth of it. Eighty percent of the bitumen underneath Alberta is too deep to mine, which hasn't stopped the oil companies from going after it.

I'm Sean Cole for Marketplace.

Log in to post10 Comments

Hi Fred,

I wanted to take a picture of Shell's tailings pond lake but I didn't get close enough to it during my visit. (It was fairly far from the robotic falcon and the sound cannon and audio took precedence over photos.) Plus we were on a bit of a tight schedule.) Photos of another company's lake, that I took from the highway, didn't come out well.

Thanks for listening/viewing!

-- Sean.

Hi Tim,

Firstly, thank you so much for your comments, and for recognizing the challenge of encapsulating the vast scope of this story in a limited amount of time. I don’t normally comment on comments but I think it’s important to put some of the issues you raised into perspective.

As you know from working at the oil sands, the mines are in the Athabasca River region. The Athabasca River itself does not flow into the ocean. It flows north into Lake Athabasca. If water weren’t a concern vis a vis oil sands production, then Shell and other producers wouldn’t be trying limit their use of fresh water, nor touting their efforts to do so. As a body, oil companies deriving bitumen from the oil sands use 2.5 percent of the annual mean flow from the Athabasca. This is according to Scott Wytrychowski, the team leader of regulatory compliance for Shell Albian Sands who appeared in the story. In our conversation, he went on to say, “It’s a use, granted, but I think it’s a use like everything else from city centers to farmers. Everybody is drawing from the system.” As I mentioned in the piece, Shell recycles most of the water it uses. (“Most,” in this case, means 85%.) I said this not as a club but as a fact. I believe one can surmise from the story that Shell is making efforts both to protect birds and to use less water. It is not my job to applaud these efforts, merely to report on them. It is also incumbent upon me to put these efforts into perspective by reporting that another company, Syncrude, has not done as well, heretofore.

For the record, I do not place the safety of Alberta workers and that of birds at the same level. In fact, I said nothing about worker safety in the story. Scott Wytrychowski did. A second listen to the piece will bear this out, and might also bring his point into sharper focus. Wytrychowski simply stated that the target number, in preventing both worker accidents and bird deaths, is zero. He places no comparative value on birds versus humans.

Regarding land use: you are correct that the band of pine trees in northern Alberta is not a forest. It is THE forest. Specifically, it is part of the Canadian boreal forest, which encompasses nearly 60% of the nation’s landmass. The oil companies working the land in Northern Alberta would likely take issue of your description of that land as “useless” (as would the aboriginal tribes who traditionally hunted and trapped in that territory, and the bears caribou and other wildlife who inhabit it). The amount of land affected by bitumen extraction and production is not debated. Its significance is debated. The area has been described as 2.5 percent of the boreal forest. It has also been described as “equal to the size of Florida.” Both are true. Take your pick.

Also, in separate conversations with three oil company executives, each acknowledged land use as a significant concern. Shell and the other oil sands miners are required to reclaim not just the tailings ponds but also the mines themselves. Syncrude has already reclaimed a portion of the land it has affected. I would have delved deeper into these issues on the air but, as you kindly acknowledged, there was limited time to address every aspect of what amounts to one of the largest construction projects in the world.

I sincerely thank you once again for listening to the program and for taking the time to comment here on the website. I appreciate your thoughtfulness regarding these issues.

Respectfully,

-- Sean.

PS: I believe part two of the story is slated for air this evening, but I’m not 100% sure about that. In any case, that second piece might help address other concerns you raised.

Andrew Logan is quoted using a tired and ignorant phrase regarding water. "oil sands are extremely water intensive in a world that is dry and getting drier." Someone should tell him water is like politics, 'it's all about local'. Northern Canada has an aboundance of water, and nothing much to do with it but watch it flow to the ocean. If oil recovery operations take a small bit of this, it is not like an animal or family or garden or farm goes without. These over dramatized environmental statements should not be taken lying down by your reporter Sean Cole and certainly should not be fousted on the public by Marketplace. Then the Shell solution to the water issue is used as a segway into, or a club to beat the audience into belief that there is no way to use water responsibly massive loss of birds. How about we applaude their efforts to both reuse water and protct birds. How many gallons and birds would have been lost without these efforts? Can they do probably, are they trying, "goal is zero".

Kevin, I liked you ideas about vacum microwaving, but this requires higher quality energy, (electricity) and capital. I also like Dale's idea to use the NG in our cars. Why not enable both by building a Nuclear Plant up there. Oh, ya that would be horrifying to Richard and his friend so probably can't do anything that looks like progress.

How come no photo of a full waste lake?

Hey Marketplace:

Great slide show, but where's the photo of a containment lake in toto?

Sean Cole tries to bring perspective and scale, while reporting on how the Oil Sands fit in the inexplicably enormous subject of energy, business and environment. This is a tall order. He sort of alludes to but won’t say, oil has traditionally been challenging to get. From “Moby Dick” to "There Will Be Blood" to present sites all over the world, the business of feeding, clothing and moving, (i.e. fueling) the modern world is no task for the faint of heart. I loved the lines about ‘being shot at, or nationalized’. But without fossil fuels, the modern world would see mass starvation along with many other hardships.

Sean Cole seems to put Alberta workers safety and bird safety at the same level, which is first ridiculous and second very offensive. I have been on energy projects all over the Western Hemisphere, including the Oil Sands. The Canadians (and the nasty old Oil Companies) are doing very well at protecting the environment up there, while creating jobs and useful energy, on a Global Scale, within a budget we can all afford. As big as the Oil Sands industry is and will become, it is but a few specs in the vast unutilized expanses of the Wood Buffalo District. Which is one of the many vast unused swaths of Northern Canada. Speaking of Northern Canada, calling the land up there a forest, is very generous by world standards. The ‘forest’, is a thin stand of scrub pine 30 or 40 feet tall at best, with a little brush between. Much of the land is either to swampy or sandy to grow much, while the mosquitoes, isolation and ridiculous cold long winters are world class. It would not take much to reclaim it to the same level of uselessness it enjoyed before oil extraction.

So in conclusion, Sean should report the facts in perspective. Where would the US be without this reliable source of oil? How large is the region, how many birds and people are there? How many normally die each year, vs. how many Americans and birds die from cars and power lines each year. Places as foreign as Fort McMurray and subjects as large as environment and energy must be brought into objective perspective, this is a forum on economics, leave the bleeding heart out. Sean, thanks for the article and keep practicing you make a reporter some day yet.

It hurts my engineering heart that big oil sees new ways to do something that is orders of magnitude cheaper and greener, but will not fund them and resort to "tried and true" techniques like water heavy power hungry tar sand recovery.

GBRC [otc] unfortunately started to show off their microwaave technology to recycle tires; It sworks better in tar sands. The btu's recovered by their microwave method in a vacuum, exceeds by at least a factor of 5 the btu's required to power it. No water is needed. Given the process is done in a vacuum, there is no pollution, and tar sands extract as oil and natural gas. Same with bituminous coal. They were first published on in Popular Science a few years ago; I wish big oil read this magazine.

I would rather see my dollars going to Canada than to buy Mideast oil. Better yet, I would like to see the natural gas that is heating the water to extract the bitumen to be compressed and used to run my car.

It's horrifying to see yet another destructive result of our love affair with oil. To what ends will we go in polluting our environment to satisfy this need?

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