Syncrude

Syncrude Canada Ltd. is one of the world's largest producers of synthetic crude oil from oil sands and the largest single source producer in Canada. It is located just outside Fort McMurray in the Athabasca Oil Sands, and has a nameplate capacity of 350,000 barrels per day (56,000 m3/d) of oil, equivalent to about 13% of Canada's consumption.[1] It has approximately 5.1 billion barrels (810,000,000 m3) of proven and probable reserves (11.9 billion when including contingent and prospective resources) situated on 8 leases over 3 contiguous sites.[2] Including fully realized prospective reserves, current production capacity could be sustained for well over 90 years.[3]

This article is about Syncrude Canada Ltd. For synthetic crude oil, see synthetic crude.
Syncrude Canada Ltd.
TypeJoint Venture
IndustryOil and Gas
FoundedDecember 1964
HeadquartersFort McMurray, Alberta
ProductsPetroleum
Number of employees
5,600 (2009)
Websitewww.syncrude.ca
Minesite at Syncrude's Mildred Lake plant

The company is a joint venture between five partners. As a result, Syncrude is not traded directly, but rather through the individual owners. As of February 2018, the partners (by percentage): Suncor Energy (58.74%), Imperial Oil (25%), Sinopec (9.03%) and Nexen (7.23%).[4][5] Because of Nexen's subsequent takeover by CNOOC, over 16% of the shares in Syncrude are controlled by Chinese State Owned Enterprises (SOE).

The ownership board must approve all annual operating budgets and proposed capital spending projects, and are required to provide the funding for said activities based on their ownership share.[6]

History

Syncrude was formed as a research consortium in 1964 by Ryan Sheppard. Construction at the Syncrude site began in 1973, and it officially opened in 1978.[2] Starting in 1996, Syncrude has been expanding its operations. Between 1996 and 1999, the original mine was expanded and the plant was "debottlenecked", increasing production from 73.5 million barrels (11,690,000 m3) per year in 1996 to 81.4 million in 1999. The total cost of this stage of expansion was $470 million.[7] Between 1998 and 2001, a new mine, Aurora, was opened 35 km north of the original site, and further debottlenecking was undertaken. Production started in Aurora in July 2001. Syncrude's production increased to 90 million barrels (14,000,000 m3) per year by the end of 2001. Total cost for this stage was $1 billion.[7]

A third stage of expansion was undertaken between 2001 and 2006, in which a second train at the Aurora line came online and the Mildred Lake upgrader was expanded. The expansion added 100,000 barrels per day (16,000 m3/d) to Syncrude's production (36.5 million barrels (5,800,000 m3) a year assuming this is average). The cost was $8.4 billion, a substantial cost overrun over the original estimate of $5.7 billion.[7][8]

On April 12, 2010, ConocoPhillips agreed to sell its share to Sinopec, a Chinese state-owned oil company. The sale, for $4.65 billion, was completed on June 25, 2010.[9][10]

A 183 m (600 ft) smokestack is located at the facility which is the second tallest in western Canada.

In April 2016, Suncor announced that they had reached a $937-million deal to acquire Murphy Oil Corp.'s five per cent stake in the Syncrude project north of Fort McMurray, Alta. This follows the hostile takeover of Canadian Oil Sands less than a year ago, and will increase its interest in Syncrude from just under 49 per cent to nearly 54 per cent, making it the majority shareholder of the project.[11]

The 2016 Fort McMurray wildfire forced a complete shutdown of Syncrude's facilities.[12]

Controversies

Pollution

Air releases of combined gases without volatile organic compounds (VOCs) by Syncrude Canada in 2005 were 129,741,321 (kg) in total, including ammonia (4,302,361 kg), sulphuric acid (1,129,425 kg), xylene (501,461 kg), etc. The company was also ranked as having the seventh highest air releases of combined gases (without VOC) in Canada in 2005.[13] Syncrude's Mildred Lake Plant Site is the largest greenhouse gas emitter in Canada emitting 12,359,420 tonnes of CO2 equivalent in 2012.[14] Research published in 2019 indicated that the intensity of CO2 emissions at the Syncrude Mildred Lake site may be 123% larger than calculations from publicly reported data would indicate.[15]

Oil sands tailings pond water
Main article: Syncrude Tailings Dam

Syncrude is a member of Canada's Oil Sands Innovation Alliance (COSIA), an alliance of oil sands producers formed in 2012, who share research on Environmental Priority Areas (EPAs) such as tailing pond water and greenhouse gases. One of the major challenges facing COSIA is the treatment of oil sands tailings pond water. "Tailings are the sand, silt, clay and water found naturally in oil sands that remain following the mining and bitumen extraction process."[16] The problem stems from the hot water process used by Suncor and Syncrude to extract bitumen from the Athabasca Oil Sands which produce large quantities of tailings pond sludge which remains stable for decades. By 1990 it was considered to be the "imminent environmental constraint to future use of the hot water process."[17] Syncrude[18] also contributes to the industry-funded Joint Oil sands Monitoring Program which was created in 2012[19] and managed by the federal and Alberta governments.[20] According to a 2013 article published in Environmental Science: Processes & Impacts, the tailings ponds contain toxic chemicals such as "naphthenic acids (NAs) and process chemicals (e.g., alkyl sulphates, quaternary ammonium compounds, and alkylphenol ethoxylates)." The study used the computer program (CXTFIT) to evaluate the transport behaviour of these contaminants through the foundation as well as underground. The chemicals seep "through the foundation of the tailings pond to the subsurface, potentially affecting the quality of groundwater."[21]

In an article accepted for publication in Environmental Science and Technology journal in January 2014, Environment Canada's Richard Frank and his team of scientists confirmed that, using new technology, they were able to "fingerprint the mix of groundwater chemicals in the area" proving that oil sands tailings pond water had leached into groundwater and the Athabasca River.[22] The study undertaken by a new federal-provincial oil sands monitoring program used new $1.6-million technology acquired in 2010. The equipment is able to "fingerprint chemicals and trace them back to where they came from."[20]

Greenpeace lawsuit

In August 2008, Syncrude Canada filed a lawsuit against Greenpeace Canada for $120,000, plus costs, after 11 Greenpeace activists went on to the company's Aurora North oil sands site July 24, 2008, to unfurl anti-oil sands banners and unsuccessfully block a tailings pipe. Company spokesperson Mark Kruger said the company filed the lawsuit—which also names the activists individually—largely because of safety concerns as the activists were "unfamiliar with an industrial operation, and unfamiliar with some of the safety hazards that can be present... We just want to ensure that, in the future, nobody is putting themselves at unnecessary risk."

Greenpeace chose the Syncrude site for the protest because in April 2008, 1600 migrating ducks died[23] after landing on a tailings pond at the site (Syncrude was fined $3 million.)[24]

Sponsorships

Keyano College

In 2004, Syncrude announced an $800,000 multi-year donation, $500,000 of which was dedicated to the new community Syncrude Sport and Wellness Centre and the balance to Keyano Theatre’s Arts Alive Series and student scholarships. In 2005, Syncrude invested another $200,000 and took the naming rights to the Syncrude Sports and Wellness Centre at Keyano College.[25]

See also

References
  1. "Syncrude Project". Canada Oil Sands Trust. Archived from the original on 2010-04-19. Retrieved 2009-07-09.
  2. "Canadian Oil Sands Trust: Syncrude Project". Archived from the original on October 19, 2010. Retrieved April 13, 2010.
  3. "Review of Syncrude Operations". Canada Oil Sands Trust - pg 2. Retrieved 2009-09-16.
  4. "Activities in Canada". Nippon Oil Exploration. Archived from the original on 2009-02-26. Retrieved 2009-02-17.
  5. "Syncrude Owners". Syncrude Canada Ltd. 2010. Retrieved 2010-07-31.
  6. "Business Description".
  7. "Overview of Growth Stages". Syncrude. Archived from the original on July 6, 2011. Retrieved April 13, 2010.
  8. Janet Mowers (April 2005). "Gearing up". Oilweek. Archived from the original on 2006-03-14. Retrieved April 13, 2010.
  9. "China's Sinopec takes $4.65-billion US stake in oilsands with ConocoPhillips buy". Vancouver Sun. 13 April 2010. Archived from the original on 21 January 2014. Retrieved 1 April 2012.
  10. "ConocoPhillips Sells Syncrude Stake to Sinopec". Press Release. RigZone. 25 June 2010. Retrieved 25 June 2010.
  11. "Suncor snags majority control of Syncrude with $937M Murphy Oil deal". CTV News.
  12. https://www.bloomberg.com/news/articles/2016-05-08/alberta-s-vicious-wildfires-spread-to-suncor-oil-sands-site
  13. "Company Profile". Pollution Watch. Retrieved 2008-05-05.
  14. "Canadian Environmental Sustainability Indicators - Canada.ca".
  15. Liggio, J.; Li, S. -M.; Hayden, K.; Darlington, A.; Mittermeier, R. L.; O'Brien, J.; McLaren, R.; Wolde, M.; Worthy, D.; Vogel, F. (2019). "Measured Canadian oil sands CO2 emissions are higher than estimates made using internationally recommended methods". Nat. Commun. 10 (1): 1863. Bibcode:2019NatCo..10.1863L. doi:10.1038/s41467-019-09714-9. PMC 6478833. PMID 31015411.
  16. "Tailings". COSIA.
  17. Majid, A.; Boyko, V.J.; Sparks, B.D.; Ripmeester, J.A.; Kodama, H (1 January 1990), (PDF), Ottawa, Ontario: National Research Council of Canada https://web.anl.gov/PCS/acsfuel/preprint%20archive/Files/35_2_BOSTON_04-90_0535.pdf Missing or empty |title= (help)
  18. "Frequently Asked Questions". 2013. Archived from the original on 29 April 2013. Retrieved 22 February 2014.
  19. "V". Environment Canada. 2013. Retrieved 22 February 2014.
  20. "Federal study confirms oil sands tailings found in groundwater, river". CTV News. 21 February 2014. Retrieved 22 February 2014.
  21. Wang, Xiaomeng; Robinson, Lisa; Wen, Qing; Kasperski, Kim L (22 May 2013). "Determination of thermodynamic and transport parameters of naphthenic acids and organic process chemicals in oil sand tailings pond water". Environmental Science: Processes & Impacts. 15 (7): 1411–1423. doi:10.1039/C3EM00089C. PMID 23736740.
  22. Oil sands study confirms tailings found in groundwater, river: Federal study shows water from tailings ponds leaching into Athabasca River, CBC News, 20 February 2014, retrieved 22 February 2014
  23. http://www.syncrude.ca/users/folder.asp?FolderID=7789%5B%5D
  24. Jeremy Klaszus, "Syncrude sues greenpeace for $120,000" Archived 2008-09-18 at the Wayback Machine, Fast Forward Weekly, August 28, 2008
  25. "Syncrude invests $200,000 to bring award-winning Science-in-a-crate program: Company also takes naming rights to future Sports and Wellness Centre at Keyano to region". 25 May 2005. Archived from the original on 10 June 2013. Retrieved 22 February 2014.
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