Suncor switch from petroleum coke to cogeneration like taking 550,000 cars off the road

In 2016, Suncor set goal of lowering total emissions intensity of its oil production 30% by 2030

Suncor’s $1.4 billion co-generation investment, announced Monday, is a good example of how the oil sands sector is increasing efficiency and lowering operating costs, while at the same driving down emissions.

The company is replacing petroleum coke-fired boilers at its Oil Sands Base Plant with two cogeneration units that use natural gas to create the steam needed by the bitumen mining and upgrading operations, as well as generate 800 megawatts of electricity. That’s about eight per cent of the province’s current electricity demand.

Petroleum coke is a byproduct of extraction that looks like coal and emits even more greenhouse gas emissions when burned. Cogeneration will reduce emissions associated with steam production by about 25 per cent. Sulphur dioxide emissions will drop 45 per cent and nitrogen oxide emissions are expected to fall by 15 per cent.

The cogeneration units will eliminate the need for the flue gas desulphurization unit that reduces the sulphur emissions associated with coke fuel. Decommissioning that unit lowers the amount of water Suncor withdraws from the Athabasca River by about 20 per cent, according to the company.

Kevin Birn is an economist with IHS MarkIt and an expert on the oil sands who completed a major study last year that forecast industry ghg emission reductions between 15 per cent to 20 per cent over the next decade just by boosting efficiency, as Suncor is doing moving from coke-fired boilers to cogeneration. “The data shows that the industry has become more efficient over time, it’s a big factor affecting historical performance,” he told Energi Media then. “What we found was that it’s a modest set of individual improvements across the board that drive material results.”

Birn says the only other oil sands operator that burns petroleum coke is Syncrude, almost 60 per cent owned by Suncor. “Syncrude is going to be challenged because the coke is combusted as part of their processing of the heavy crude oil,” he said in a Tuesday interview. “It’s a bit harder to change without changing the entire upgrading processes. It’s a much more significant effort.”

This project will increase demand for clean natural gas from Western Canada.

Suncor CEO Mark Little says the cogeneration project is a great example of how the company “deploys capital in projects that are economically robust, sustainability minded and technologically progressive. This project generates economic value for Suncor shareholders and provides baseload, low-carbon power equivalent to displacing 550,000 cars from the road, approximately 15% of vehicles currently in the province of Alberta.”

The project cost is estimated to be in-service in the second half of 2023. This project will substantially contribute to the company’s goal of an increased $2 billion in free funds flow by 2023. This will be achieved through Oil Sands operating cost and sustaining capital reductions along with margin improvements.

“By producing both industrial steam and electricity through a single natural gas-fuelled process, cogeneration is the most energy-efficient form of hydrocarbon-based power generation,” the company said in its release. “Suncor believes this project will contribute to both Alberta and Canada’s climate ambitions.”