Thursday, July 12, 2012

Shell gets conditional approval for carbon capture scheme

The Scotford upgrader.
Picture from Natural Resources Canada. That's right,
I'm stealing pictures from the government now.
Shell has been given conditional approval from the ERCB to capture carbon dioxide from its Scotford upgrader near Edmonton. That's a first for the industry. The project is planned to cost $1.35 billion dollars and capture 1.2 million tonnes of CO2 per year. That apparently includes $745 million over 15 years from the Alberta government and $120 million from the federal clean energy fund. The rest of the cost will presumably be split between Shell and its Scotford partners - Chevron and Marathon, each with 20% stakes.

If Shell decides its a good idea and can convince its partners the same, liquefied CO2 will be piped north of the plant and stored 2,000 metres down. The plan comes with conditions from the ERCB and still doesn't have approval from Alberta Environment. It also doesn't have final sanction from Shell, who may still scrap the program for economic reasons, like TransAlta did with its Keephills 3 coal plant back in April.

The province apparently aims to reduce its CO2 emissions by 5 million tonnes per year by 2015. This would obviously be a big step in that direction for them, but I can't help but think there could be cheaper ways to do that. How about more transmission capacity to access BC hydro power? That would serve the additional purpose of helping to tie the economies of the two provinces together, something the Redford government seems keen to do. Or how about nuclear power? Saskatchewan is the world's biggest producer of Uranium, so why are there no Canadian nuclear plants outside of Ontario? And, perhaps most obviously, how about gas? Alberta itself has huge amounts of the stuff that is so cheap it's being shut in. Why is Ontario phasing out coal plants and replacing them with gas and we aren't? As I've said before, the more Alberta can reduce its emissions in other sectors, the more cover it's buying for the oil sands in the eyes of environmentalists.

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