Alberta Premier Rachel Notley along with Energy Minister Margaret McCuaig-Boyd joined officials from Nexen, First Nations companies and other local suppliers at the ceremony to kick off construction at Nexen’s Long Lake South West expansion project. Alberta government photo.
Nexen Long Lake South West technology will decrease GHG emissions intensity by 20 per cent
On Tuesday, Premier Rachel Notley and Energy Minister Margaret McCuaig-Boyd joined Nexen officials, First Nations enterprises and other local suppliers at an event highlight Nexen’s Long Lake South West expansion project.
The $400 million project uses leading-edge technology and the Alberta government says it illustrates that a major oil sands producer can be both an energy and environmental leader as well as a company that creates good jobs in the Alberta energy sector.
The CEO of CNOOC North America, Quinn Wilson says the project demonstrates his company’s long-term commitment to the Alberta energy sector.
“Our oil sands development is an important component of our global portfolio, and through technological advancements we are pleased to be responsibly growing our production while reducing our overall emissions,” said Wilson.
Construction on the project should be complete by 2020 and is expected to produce 26,000 barrels per day (b/d) once it reaches full capacity.
The facility will require less steam and natural gas on a per-barrel basis, and will use less energy overall for total production.
With this new technology, Long Lake will achieve a 20 per cent reduction in greenhouse gas emissions intensity from current levels by 2025.
“We’ve always said that you can’t write climate action out of economic growth, and you can’t write working people out of climate action,” said Premier Rachel Notley. “Long Lake South West is a prime example of that principle, putting people to work while growing our energy production and reducing emissions at the same time.”
The $400-million investment in Long Lake South West includes engineering, construction and startup, with more than 90 per cent of this value spent in Alberta.
Approximately 250 full-time jobs are expected at the peak of construction, with an estimated $200 million in provincial royalties and property taxes during the life of the project.
“As Albertans, we’re so proud to be world leaders in responsible energy development,” said Minister of Energy Marg McCuaig-Boyd. “When we put the right conditions in place to make our industry more cost- and carbon-competitive, the energy sector steps up to the plate, creating valuable partnerships with First Nations that provide lasting benefits for generations to come.”
At this time, contracts for the projects are in the process of being awarded. Nexen says it is looking to work with local and Indigenous-owned companies on the project. So far, two major contracts have been awarded to First Nations enterprises as well as other local suppliers.
Carolynne McCuaghey, director of Corporate Services with Christina River Construction says her company is pleased to have been selected as a major partner in the civil earthworks contract with Nexen.
“With our partnership with Fort McMurray #468 First Nation, we look forward to positively impacting the local community through employment opportunities, and to play a role in supporting our province for economic development.”
Karl Rudd, president and CEO of AKITA Drilling Ltd., which will be part of the project says “this opportunity will continue to support the communities’ economic growth and we look forward to a safe and successful drilling campaign”.
The Long Lake South West expansion project will employ steam-assisted gravity drainage, which is a thermal production technology that uses two parallel horizontal wells, known as a well pair, one to inject steam, and the other to produce water and oil. Initially, steam is circulated in both wells to establish communication between the wells.
The top horizontal well then continuously injects steam to heat the reservoir, creating a steam chamber. The oil from the chamber drains to the production well below to allow for production initially through pressure drive, and then by artificial lift or gas lift. The steam injection and oil production happen continuously and simultaneously once production starts. This technology has a high ultimate recovery of oil from the reservoir relative to other in situ production technologies.
Nexen is a wholly owned subsidiary of CNOOC Ltd.