Field tests by Alberta's Oil Sands Technology & Research Authority (Aostra) are proving up technology to economically recover 330 billion bbl of bitumen from the Athabasca oilsands.
Aostra reports results to date are positive in tests of its in situ, twin horizontal well, steam assisted gravity drainage (SAGD) technology.
Aostra and nine commercial partners are involved in a demonstration project at the agency's underground test site in the Fort McMurray, Alta., area.
The system uses two 1,6.40 ft horizontal wells placed 10-16 ft vertically apart in the oilsands pay zone. The top well injects steam into the reservoir, and heated bitumen flows by gravity into the lower well. The lower well produces a bitumen/water/gas mixture in the process of extracting bitumen from oilsands.
Aostra says studies show a 30,000 b/d in situ operation using SAGD can produce bitumen at a supply cost of $7.50 (Canadian)/bbl, well below current costs. The supply cost includes capital payback and operating cost but excludes royalties and taxes.
Commercial participants in the project are Amoco Canada Petroleum Ltd., Chevron Canada Resources Ltd., Conoco Canada Ltd., CNPC Canada Ltd., Imperial Oil Resources Ltd., Japex Oilsands Ltd., Petro-Canada, Shell Canada Ltd., and Suncor Inc. The federal energy department is participating in a geotechnical program.
Syncrude Canada Ltd., an associate member of the group, buys the project's 2,000 b/d of dry bitumen production.
Aostra says SAGD technology can be applied commercially to the Athabasca, Peace River, and Cold Lake regions of Alberta which hold more than 1 trillion bbl of oil in place. The agency reckons 330 billion bbl could be recovered by SAGD from the Athabasca sands based on 50 ft of oilsands pay, a 98 ft overburden, and 55% recovery.
Aostra figures the next step toward a commercial project is to establish a working project group.
Studies show a 30,000 b/d operation is the most economically attractive minimum size. A $225 million initial capital investment would be needed and an additional $250 million during 25 years.
Average operating costs would be $40 million/year. Production costs are estimated at $3.65/bbl.
Aostra says in addition to interest from Canadian companies it has had inquiries on participation from companies in Taiwan and Korea.
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