Alberta hopes to attract investment in zero-emission industry with world’s largest carbon pipeline

Mark Lowey
July 15, 2020

The Alberta government and private sector are hoping the world’s largest carbon dioxide pipeline will attract companies wanting to build “green” industrial facilities with zero or greatly reduced carbon emissions.

The $1.2-billion, 240-kilometre Alberta Carbon Trunk Line (ACTL) became fully operational in June. The line is designed as the backbone infrastructure for carbon capture and storage (CCS) projects needed to support a lower-carbon economy in the province.

The ACTL has been in the works for about 15 years. In 2009, then-premier Ed Stelmach’s government invested $495 million in the project.

“Why we put public dollars into this is because this is such a key technology for the province’s economy going forward,” Justin Wheler, executive director, climate implementation and compliance, at Alberta Environment and Parks, said in a webinar presented by the Global CCS Institute on July 9.

“Now we can go to the world and say, ‘You want to build a net-zero [emission] facility? Alberta is the place to do it.’ We’re competitive on every front of attracting investment.”

The ACTL system will initially capture 1.6 million tonnes per year of CO2 emissions from two sources: an oilsands refinery and a fertilizer plant in the Industrial Heartland region just northeast of Edmonton. The pipeline delivers the CO2 to mature oil and gas reservoirs in central Alberta, where the CO2 is used in enhanced oil recovery while being permanently stored underground.

However, the ACTL is built to handle 14.6 million tonnes of CO2 per year, said Blair Eddy, chief operating officer at Calgary-based Enhance Energy. Enhance owns and operates the oil reservoir which receives the CO2 from the ACTL system.

The ACTL system was deliberately designed to grow, by capturing and transporting more CO2 from existing and future industrial facilities built near the route of the pipeline, Eddy said.

For example, existing refineries and petrochemical plants that now produce hydrogen for their industrial processes could tap into the pipeline to produce net-zero emission “blue hydrogen,” for Alberta’s envisioned hydrogen economy.

On July 9, the UCP government announced a new 10-year Alberta Petrochemicals Incentive Program, to launch this fall, which will offer direct grants instead of royalty credits to encourage investment in new petrochemical projects.

Alberta’s Industrial Heartland Association estimates there could be a further $30 billion of private sector investment in the petrochemical sector by 2030, with the potential to create 90,000 direct and indirect jobs in construction and operations.

But more industry will mean more emissions. With its well-established petrochemicals industry and its reliance on oil and gas extraction and production, Alberta currently accounts for 273 million tonnes of greenhouse gas (GHG) emissions per year. That amounts to 37% of Canada’s total GHG emissions, the highest of the provinces.

Carbon capture, utilization and storage technologies are crucial to Alberta’s strategy for reducing those emissions, Wheler said. “We have lots of extra capacity in the [ACTL] pipeline . . . So now we can capture another 13 million tonnes [per year] without having to build a new pipeline.”

Turning “waste” CO2 into valuable commodity

Initially, the ACTL will transport 1.3 million tonnes per year from the Sturgeon Refinery, which upgrades oilsands bitumen into low-carbon diesel fuel and other value-added products, and another 300,000 tonnes per year from Nutrien’s Redwater fertilizer plant.

The Sturgeon Refinery was designed and built to produce a pure stream of CO2, the major source for the ACTL system, said Alyssa Haunholter, vice-president of government and stakeholder relations at North West Refining, founders and 50% owners of the refinery. “These projects don’t happen unless you can have a strong partnership between government and industry,” she noted.

Another project partner, Calgary-based Wolf Carbon Solutions Inc., owns and operates the compression facilities at the two CO2 capture sites in the Industrial Heartland, as well as the 240-km pipeline that transports the CO2 from source to storage.

Eddy said the CO2 transported by the ACTL system enables oil to be extracted from aging reservoirs that otherwise would not be recovered. Being able to access another 10 to 30 percent of that oil extends the life of those oilfields by another 20 to 40 years, he said.

“We get to turn what is otherwise considered a waste product, the CO2, into a valuable commodity,” Eddy said. “There is a huge opportunity in this province to expand CO2 capture and EOR [enhanced oil recovery] and create tremendous value for Alberta and Canada.”

Alberta expects to earn about $15 billion in royalties over 30 years from the ACTL system, according to the government’s “knowledge sharing reports” on the province’s CCS projects.

The ACTL is one of two commercial-scale CCS projects to which the Alberta government has committed more than $1.2 billion, Wheler said. The other is the Shell Canada-operated $1.35-billion Quest project, to which the province contributed $745 million. The federal government provided $120 million for engineering and design work.

Quest, which opened in 2015, is the world’s first oilsands CCS project. It is capturing and geologically sequestering more than 1 million tonnes of CO2 per year from the Scotford bitumen upgrader near Edmonton. That reduces the upgrader’s emissions by about one-third.

Shell announced on July 10 that Quest reached the milestone of sequestering 5 million tonnes of CO2, equivalent to the annual emissions of about 1.25 million cars. The accomplishment was achieved ahead of schedule and at about 35% lower operating cost than originally forecast in 2015, the company said in a statement.

“This technology is really the bridge to our low-carbon [economy],” Eddy said. “We think there’s a bright future for Alberta in this.”


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