Clogged pipelines, discounted oil prices and further delay of the Keystone XL pipeline have all conspired to keep Alberta’s oil sands producers in a state of limbo, with many companies cutting back on production.
Pipeline pressure has forced many oil companies to rely on the railroads to move their heavy crude – on trains owned by Canadian National Railway Co and smaller rival Canadian Pacific Railway Limited. However, moving crude by rail can not only be dangerous but it is costly.
Enter Canadian National Railway (CN) – announcing it holds a patent for a technology dubbed CanaPux, in an apparent reference to the hockey puck-like product under development. According to CN, their technology uses solidified crude encased in plastic. “The pellet is not flammable or explosive, will float in water and nothing can leach or dissolve into the environment. It does not create dust,” CN claims.
Enter Canapux – Hockey puck oil
CN claims that solid crude, never before commercially shipped in the world, can be transported more cheaply, efficiently and with less environmental risk than liquid crude in tank cars, reports Reuters.
Canapux is said to float making it easy to retrieve from bodies of water. CN makes clear the technology behind Canapux is still in the early stages of development and any environmental impacts have not yet been studied.
“We want to do the studies that will prove that it will float in fresh water, salt water, how it behaves in cold and in heat,” Janet Drysdale, vice president of corporate development at CN, told The Globe and Mail in February 2017. “All of that will be validated with additional lab work.”
James Cairns, CN’s vice-president of petroleum and chemicals said interest in new technologies to move bitumen as a solid picked up after a Canadian court in August overturned Ottawa’s approval for the Trans Mountain oil pipeline expansion.
Crude producers, buyers, and transport companies have all been interested. “There have been a lot more discussions about, ‘How do we get this done?’” Cairns said. “Conversations are much more advanced than they were.”
Pilot plant coming soon
CN is already looking for a commercial partner to construct a pilot plant that would process 10,000 barrels per day of undiluted heavy crude into Canapux. CN is looking to put the plant either at the Alberta crude storage hub around Edmonton or on an oil producer’s site.
The price for construction of the plant is estimated at less than C$50 million ($37.8 million). It could be running as soon as 2020, Cairns said.
The oil pucks would be transported in gondola cars which weigh less than an oil car. Gondola cars would allow CN to load more of the crude, and since the pucks don’t need a diluent, the end result is that “Canapux’ shipping costs would knock off nearly half the expense of rail transportation in liquid form,” according to CN.
CN also confirmed that the CanuPux technology was separate from the work at the Schulich School of Engineering, CN would not offer further comment on the status of the CanuPux technology.
Professor Ian Gates and his team at the University of Calgary’s Schulich School of Engineering found a way to turn bitumen or extremely heavy crude oil into “self-sealing pellets” that have a liquid core and super-viscous skin.
The process reduces the chance of a damaging spill during transport. The pellets can be designed to be buoyant and safe if they are spilled into the environment by incorporating agents within the pellets, like gas bubbles, catalysts, and solvents.
Another company, Calgary-based Bitcrude, is a startup that took third place at the 2016 Energy New Venture Competition. The company’s technology transforms bitumen into a solid crude oil. The solid crude transports and stores as a solid. It is packaged on a pallet and transported in standard shipping containers, with access to global markets.
Alberta inventor Cal Broder said two refineries in China are interested in his Bitcrude product. Bitcrude is planning a test shipment of several containers of the butter-like crude to Asia before the end of the year.
Regardless of which of these three technologies make it off the drawing board and actually get into full-scale production, there is still the regulatory process to go through as well as environmental impact studies.
However, the idea of shipping crude in solid form is compelling, said Alex Pourbaix, chief executive of Cenovus Energy, a major Canadian shipper of crude by rail. “I am quite intrigued by those technologies,” he said in an interview. “We’re going to make sure we take a hard look at them all.”
