Extra Heavy Oil and Bitumen

Impact of Technologies on the Recovery Factor

« The Challenges of Enhanced Recovery »

François CUPCIC
Heavy Oil Research Leader
Heavy Oil : a mix of heterogeneous denominations

Confusing heterogeneous denominations :

§ Heavy Oil, Extra Heavy Oil, Oil Sands, Tar Sands, Bitumen, ….
è need for a simple classification

4 Classes based mainly on downhole viscosity :

0 A Class : Medium Heavy Oil 25°> d°API > 18°
100 cPo >µ > 10 cPo, mobile at reservoir conditions
0 B Class : Extra Heavy Oil 20°> d°API > 7°
10 000 cPo >µ > 100 cPo , mobile at reservoir conditions
0 C Class : Tar Sands and Bitumen 12°> d°API > 7°
µ > 10 000 cPo, non mobile at reservoir conditions
0 D Class : Oil Shales
Reservoir = Source Rock, no permeability
Mining Extraction only

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 2

 Heavy Oil (excluding Oil Shales) : 3 Main Categories

Heavy Oil Classification

10 000 000
Wabasca

Athabasca
1 000 000
C Class :
Tar Sands & Bitumen
Downhole Viscosity (Cpo)

Canada

100 000 Peace river

B Class :
Cold lake
Upper & Lower Ugnu Extra Heavy Oil
Cat canyon

10 000
EljoboBoscan Poso creek
Yorba linda A Class :
Fazenda belem

Orinoco
Llancanelo
Belridge Kern
Alto do rodrigues 2
Lloyminster
river Medium
1 000 Mormora mare Grenade
Tia juana Midway
Bressay Estreito Heavy Oil
Morichal
Bati
Sarago mareraman Mariner (H) Alto do rodrigues 1
Pilon Bechraji
Mount poso Duri
Rospomare Qarn alam
Varadero Balol
100 Bachaquero Emeraude
Captain u
Mariner (M) Shoonebeck
Boca de Jaruco
West sak
u Lacq Sup.
10 uDalia
0,0 5,0 10,0 15,0 20,0Rosa
uTempa 25,0
API Density (11-23°API)

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 3

 "Heavy Oils" : Resources of 4000 to 5000 Gb (OIP)
Potential Reserves depends on recovery factors

Considerable Potential Reserves : # 500 to 1000 Gb

equivalent to 50-100% of worldwide conventional oil reserves
5 to 10 times (?) the ultra-deep offshore potential reserves
mainly (80%) in extra heavy oil, tar sands and bitumens
mainly (80%) in North and South America
less than 1% produced or under active development

Heavy Oil Reserves Light Oil Reserves

270 310 260

Venezuela Canada Saudi Arabia

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 4
 Huge Untapped Resources in Orinoco and Athabasca

54,000 km2
45,000 km2

ALBERTA

Athabasca
Fort
Mc Murray

Peace River

Cold Lake

Edmonton
Cretaceous
Lloydminster Oil Sands
Cretaceous
Calgary Heavy Oils

SINCOR OPCO SURMONT

SAGDPilot

Extra Heavy Oils Tar Sands & Bitumen

(µ < 10,000 cPo) (µ > 10,000 cPo)
Oil in place: 1,200 Gb Oil in place: 1,300 Gb
(PDVSA estimates) (EUB estimates)

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 5

 A decisive difference: the geothermal gradient

10 000 000 cPo

1 000 000 cPo

100 000 cPo Viscosity = f(tempure)

10 000 cPo

1 000 cPo

100 cPo

10 cPo

1 cPo
0 °C 50 °C 100 °C 150 °C 200 °C 250 °C 300 °C

Athabasca : Orinoco :
• T res. # 11°C • T res. # 53°C
• µ ‡ 1,000, 000 cPo • µ # 1,500 to 3,000 cPo
Thermal Production Compulsory Cold Production Possible
Downh
ole
pump

550m

200m 1400m

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 6

 Production Technologies

1 - Proven technologies
… but with limited suitability or
recovery efficiency

• Mining Extraction
• Cold Production
• Huff & Puff

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 7

 Mining Extraction
• Proven technology
• High Recovery Factor
• Decreasing operating costs :
3 1980's : > 25 US$/bbl
3 2002 : 8 - 12 US$/bbl
• Limited GHG emissions

ALBERTA
Athabasca

Fort

BUT : Mc Murray
Cold Lake
Edmonton
• Overburden limited to 50-75 m
Calgary
è suitable to less than 10% of Oil in Place in
Athabasca

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 8

 Cold Production
• Proven technology
• Fair productivities with
horizontal wells (Venezuela)
or with CHOPS (Canada)
• Limited investments
• Limited operating costs
(2 to 4 US$/bbl) Sand

• Available artificial lift +

Oil
technologies: PCP, rod
pumps
• No GHG emissions

BUT : CHOPS

• Poor recovery factors (# 5 to 10%)

• Unsuitable for bitumens (too viscous)
• Unsuitable for reservoirs with active aquifer
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 9
 Example of Cold Production : the Sincor Project
JOSE
32° API 180Kbls/d
ZUATA
8.5° API 200Kbls/d Distillation Hydrotreater

21+200 km

Diluent 70 KBD
12”-20”

26”-36”

Diluted crude 270 KBD ZUATA SWEET

Cold SOLIDS

Coke 6000 t/d

Production Coker Hydrocracker Sulfur 500 t/d

Investment : US$ 4.2 billion

THE PARTNERS
Plateau production : 200 kbd of crude oil
180 kbd of Zuata Sweet TOTAL 47 %
Oil gravity : 8.5° ð 32° API
Technical cost : < 7 US$ / b 38 %

Contract duration : 35 years 15 %

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 10

 Huff & Puff

• Proven technology :
• Canada : Cold Lake, Wolf Lake & Primrose
• Venezuela : Maracaïbo & Oriente Basins
• California : Kern River
• Limited operating costs :
• 4 to 5 US$/bbl

BUT :
• Limited recovery factors (< 15-20%) : only stimulation around
wellbore
• Consumption of energy and increase of GHG emissions

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 11

 Production Technologies

2 - More efficient technologies

… but not yet field proven
• In-Situ Combustion
• Solvent Injection

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 12

 In Situ Combustion
Combustion Mobile oil Cold Heavy
front zone (MOZ) Oil • Old technology (1960's)
• High Recovery Factor :
• up to 60%
Air & Water • Self-generation of energy
(coke consumption)
• In situ upgrading (thermal
cracking)

Producer
well
BUT :
• Field tested nearly exclusively on light oils
• Not so many successes (operational and safety problems)
• Pattern adapted to extra-heavy oil & bitumen to be found
and field tested ...

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 13

 Solvent Injection
Molecular diffusion
Capillary mixing
Convective dispersion
Solubilization
Viscosity
Viscosity reduction
reduction
Swelling
Asphaltene precipitation • High Recovery Factor :
• up to 60%
Solvent
flows to Solvent • Low energy consumption
interface • In situ upgrading
(asphaltene precipitation)
g • No boiler feedwater
Oil treatment
• Limited GHG emissions
BUT :
• Slow process (molecular diffusivity much smaller than thermal
diffusivity)
• Start-up not so easy : need for warming with steam ?
• Possible "killing factor" : solvent loss in reservoir ?
• Not yet field tested : first pilots being launched in Alberta
• Not mature enough for industrial application until some years
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 14
 Production Technologies

3 - Available efficient technology

… with proven results

• Steam Injection and SAGD

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 15

 Steam Assisted Gravity Drainage (SAGD)
• High Recovery Factor :
• up to 60%
• Quick process (high
thermal diffusivity)
• Proven technology :
• several pilots since
1980's in Alberta and
elsewhere
• Mature enough for
medium scale field tests
BUT :
• Huge need of energy : 1500 MW for 100,000 bopd !!
• "Killing factor" : steam oil ratio (has to be < 3 vol./vol.)
• Large GHG emissions : up to 15,000 Tons/day of CO2 for
100,000 bopd
• Requires technics adapted to high temperatures (artificial lift,
metering, surface pumping, …)
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 16
 SAGD : already a reality in Alberta

Phase 1 of Foster Construction of

Creek (EnCana) Christina Lake
(EnCana)

Construction of Mac Surmont Pilot

Kay River (Conoco-Phillips /
(PetroCanada) Total / Devon)
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 17
 SAGD 1st Challenge : To Increase Oil Value

UPGRADING & VALUE OF THE PRODUCT

100%

LIGHT FRACTION
Deep Upgrading
80%
Mid Upgrading
60%
Mini
17 $/bbl Upgrading 17.6 $/bbl
40%

20%
15.6 $/bbl
0%

-20% 8.5 $/bbl

HEAVY FRACTION

-40%

-60%

Gasoil (145-375°C) Gasoline (0-145°C)

-80%
VGO (375-540°C) VR 540°C+
-100%
BRENT ATHABASCA ORENOQUE Diluted Syncrude LR- Syncrude H- Syncrude Syncrude H- Syncrude
Bitumen coking OIL with VR SINCOR OIL without VR HDH +
19°API 23°API 23,5°API 32°API 32,4°API 36,3°API

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 1

 Upgrading : a Balanced Choice

Thermal Deep
Cracking Hydrocracking

• Lower Investment Costs

• Lower Cost of Steam : • Higher SCO value
petcoke may be used as
fuel
BUT
BUT
• Higher Investment Costs
• Lower SCO value • High consumption of
natural gas for H2 and
steam production

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 19

 SAGD 2nd Challenge : To Reduce Cost of Steam

Combustion of natural gas :

• simple and cheap boiler technology
(OTSG)
• reduced treatment of boiler feedwater
• minimized GHG emissions
• limited investment costs :
• # 160 MMUS$ (for 100,000 bopd)

BUT
High operating cost :
3 US$/Bbl
(gas price ± 3 US$/MMbtu)

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 20

 1st Alternative Fuel : Combustion of Upgrading Residues
Combustion of residues :
• cheaper fuel than natural gas :
• reduced operating cost : 3 è 1 US$/bbl
• avoids stockpiling of residues (petcoke,
asphalts)

BUT
• Requests specific boilers
• Heavier treatment of boiler feedwater
• High sulphur % è FGD compulsory
• Requires regenerative FGD process to
avoid stockpiling of Ca2SO4
• Higher CO2 emissions
• Higher investment costs :
• 160 è 500 MMUS$ (100,000 bopd)

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 21

 2nd Alternative Fuel : Gasification of Upgrading Residues

Synthetic Crude Oil

Gasification of residues :
30.2°API
Naphta/Gasoil
S 85 KBOPD
HDT C
O • cheaper fuel than natural gas
• reduced operating cost :
3 è 1,3 US$/bbl
DAO/VGO
T-Star
Surmont
8°API
Crude
100 KBOPD
unit
hydrogen HP Steam • avoids stockpiling of residues
Vacuum
distillation Gasification
(petcoke, asphalts)

Asphalt
Gas cleanup
and Sulfur OTSG • allows production of H 2 for
syngas recovery Clean
Deasphalting
unit
syngas hydrotreatment
• easier capture of SO2 and CO 2
• syngas can be burnt into simple
OTSG boilers
• reduced treatment of boiler
feedwater

• Higher investments costs :

BUT • 160 è 360 MMUS$ (100,000 bopd)
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 22
 SAGD 3rd Challenge : To Reduce CO2 Emisions
Synthetic crude oil

Bitumen 100 000 BPOD SCO 88 050 BOPD

Total CO2 : 14 300 tons / day CO2

Diluent recycle
3 300 tons / day

CO2
11 000 tons / day Diluted Bitumen C3
19 °API Upgrader
Oil Water
separation Flexicoker
case SCO

Steam
Pads Sulphur
Steam : 43 200 tons/day Generation Equivalent gas
71.9 MMSCFD

8 - 12 wellpairs / Pad
Water
SOR : 2.5 Vol / Vol 38.5 MMSCFD make up
Artificial lift : Gas lift + ESP

82.8 MMSCFD Natural gas 44.3 MMSCFD

Electrical power
external supply

Nota : CO2 for bitumen production with only

Natural gas : 6 500 tons / day

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 23

 CO2 Emissions in SAGD

125

1 ton CO2/ton syncrude

kg CO2 / barrel of bitumen

100

Range of
possible variation Upstream
75 Upgrader
Refining

50

25

0
Athabasca Athabasca SINCOR
SAGD Mine
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 24
 Cost of CO2 Capture
Today solution : MEA process

?
Tax ?
technical capture cost # 25 US$/T CO2
10 US$/T CO 2 ? è + 2 US$/bbl
+ 0,5 T CO2 emission / T CO2 captured
20 US$/T CO 2 ? è + 4 US$/bbl
è real capture cost # 50 US$/T CO 2
30 US$/T CO 2 ? è + 6 US$/bbl
è + 10 US$/bbl !!

Possible solution :
Off-gas
vent
oxy-combustion STEAM /
ELECTRICITY

(concentration of
CO2) Oxygen
Production
BOILER Flue gas
Treatment
CO2 Separation/
Inerts removal

HEAVY RESIDUE
Steam BFW
CO2
Sequestered

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 25

 Conclusion : Impact of Recovery Efficiency
( Upstream + Downstream + 20 $/T CO2 tax
Technical cost ( Upstream + Downstream
CO2 Emissions
(US$/bbl) ( Upstream only (no upgrading)
(kg/bbl)
20 200

(
15 150 (
SAGD
( SAGD

10 100
(
( (
5
( Cold 50
( Production ( Cold
( Production
0 0
0% 10% 20% 30% 40% 50% 60% 0% 10% 20% 30% 40% 50% 60%
Recovery Efficiency Recovery Efficiency
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 26
 Conclusion

Difficult choice between :

current proven technologies :
4 limited costs and GHG emissions
4 limited recovery factor (10% max?)
emerging “hot” technologies :
4 higher recovery factor (40%+?)
4 but : higher cost and higher GHG
emissions

A temptation:
4Nuclear Energy to produce steam?
4But not without drawbacks
(especially beyond technology)
ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 27
 The End

Thank you for your attention.

ASPO Annual Meeting 2003 - Rueil- 26-27 May 2003 28