Former Oilsands Executive Looks To Clean Up Bitumen Upgrading With Two Pilot Projects

20-Dec-2013

By Joseph Caouette - Daily Oil Bulletin

A pair of pilot plants in central Alberta -- one now operating and another planned -- offer the potential for cleaner, cheaper bitumen upgrading, say the proponents.

Western Hydrogen Ltd. recently held a grand opening for its molten salt gasification pilot plant in Fort Saskatchewan. The project produced first hydrogen back in September, but the event was the first opportunity for many in the industry to see the technology up close.

Using a process first developed by the U.S. Department of Energy at its Idaho National Laboratory, the plant produces hydrogen using only water and a carbonaceous feedstock, such as petroleum coke or biomass. According to the company, produced water from oil operations could even be used in the process -- the carbon content of the water might even be seen as a plus.

The two inputs are fed into a high-pressure reactor containing a molten salt bath, and hydrogen and carbon dioxide is produced. Because the gases come out at pressures of up to 2,000 pounds per square inch (psi), the CO2 is ready for use in sequestration and enhanced oil recovery. At the same time, the plant should also lower the supply cost of hydrogen while also reducing greenhouse gas emissions compared to other methods of hydrogen production.

The process could be useful in a variety of fields -- representatives from the German consulate were at the event, eyeing up the plant's potential for their country's renewable energy sector -- but the most immediate opportunities lie in the oilsands, where hydrogen is a crucial input for upgraders.

If the company's leadership is any indication, the oilsands will undoubtedly play a big part in the commercialization of Western Hydrogen's process. Guy Turcotte, the company chairman, is the former founder and chair of Western Oil Sands Inc., which was sold to Marathon Oil Corporation in 2007. Neil Camarta, the president and chief executive officer, has a long history of his own in the industry, including senior executive roles at Shell Canada Limited, Petro-Canada and Suncor Energy Inc.

In an interview with the Bulletin, Camarta said the company has already seen a fair amount of interest from some oilsands producers.

"The most hydrogen intensive place on earth is just down the road -- Shell's [Scotford] upgrader, the one I built, and another one just like it," he said.

"When you upgrade oil from sands, take the bitumen molecule and try to make gasoline from it, you have to go through a lot of heavy lifting and it takes hydrogen every step of the way," he added. "We're right in upgrader alley, right in the heart of the biggest hydrogen consumption place on earth."

Currently, the plant is running on asphalt purchased from a local supplier.

"The reason we're running that is because it's probably the worst thing you could think of to run through here. It's heavy and it's hard to handle. So if we can run it on asphalt, we can run it on anything," Camarta explained.

As the pilot progresses over the next couple of years, the plant will cycle through a wide range of feedstocks, including natural gas, petroleum coke and renewable sources such as glycerol. Unlike the steam methane reformers that commonly use natural gas to produce hydrogen, the molten salt gasification process is very flexible when it comes to feedstocks.

"This machine can run on gas, but the same machine can be switched over to other feedstocks," Camarta said. "We have to make some adjustments to the front-end, but the same machine can use alternate feedstocks, depending on what's the cheapest and what's available."

Next year, Camarta and crew will be returning to the same site to build another pilot plant under the name Field Upgrading Ltd. The company, spun off from Western Hydrogen, will use a molten sodium process to upgrade bitumen.

"It turns out if you mix sodium and bitumen at about 350 degrees Celsius, the sodium goes in and grabs all the bad stuff," Camarta said. "It's like a cruise missile for sulphur, for example, and it takes all of that out of the oil."

Because sulphur helps bind the larger molecules, the bitumen is broken down, and heavy metals are removed. Beyond sodium, all that the process requires is a modest quantity of hydrogen or methane. "You go in with really heavy oil and come out with oil that's light enough that you can pump it without adding diluent," Camarta said.

The process produces sodium sulphite, which must be broken down to recycle the sodium salts for re-use. For that, Field Upgrading turned to technology from Ceramatec Inc., a research firm based out of Salt Lake City, Utah. The sodium sulphite is placed in a ceramic membrane reactor, where electricity is applied, ionically removing the sodium and leaving behind elemental sulphur.

According to the company, the process will require less hydrogen and produce lower emissions than current industry methods of bitumen upgrading.

"That's the idea -- come up with a cheaper and cleaner way to upgrade oil and bring upgrading back to Alberta," Camarta said.

He said the company plans to order the pilot plant in the first quarter of 2014, with delivery slated for the final quarter of the year. Start-up is scheduled for the first quarter of 2015.