Oil Sands and the Environment – Part II
Today I continue coverage of my recent visit to the Athabasca oil sands near Fort McMurray, Alberta. I was there as a guest of the Canadian government, which hosts annual tours for small groups of journalists and energy analysts. I will be covering multiple aspects of oil sands production in a series of posts.
In last week’s post — Oil Sands and the Environment – Part I — I discussed greenhouse gas emissions, impacts on wildlife, and I touched upon water usage. I also detailed some of the work of Pembina Institute (PI), which is working to improve the environmental conditions as the oil sands are developed. Today’s article will discuss the tailings ponds, water consumption, impacts to water quality, and impacts to indigenous people.
There are two primary ways of extracting bitumen from the oil sands. In situ production involves injecting steam into the ground to heat up the bitumen which is then pumped out of the ground. Surface mining is done when the resource is fairly close to the surface. During my trip we visited one in situ producer – Cenovus Energy – and one surface miner – Canadian Natural Resources Limited (CNRL). These methods will be discussed in greater detail in next week’s post.
Most of the oil sands production to date has come from surface mining, and this is the technique that has attracted the most environmental criticism. During the processing of oil sands from surface mining, a mixture of water, sand, clay and residual oil (less than 10 percent of the bitumen contained in the ore is left after processing) is transported to an engineered pond called a tailings pond where additional settling occurs. These infamous tailings ponds immediately come to mind when discussing the environmental impact of oil sands development.
Suncor site and tailings ponds at Fort McMurray. Source: Bruce Edwards, edmontonjournal.com
One thing I learned is that these ponds are often built from the pit that was created from digging out the ore. So after one portion has been mined, a tailings pond can be created that will ultimately be backfilled and reclaimed. This gave me an image of an operation that pulls oily sand from the ground, extracts most of the oil, and then puts the relatively clean sand back in the ground. So the stuff that is going back into the pit is the stuff that came out of the pit — there’s just a lot less of it after processing. In fact, one of our tour guides joked that they were simply cleaning up an oil spill that occurred hundreds of millions of years ago.
So why are the tailings ponds so controversial? A couple of reasons. One is that they are one of the most visible markers of an open pit bitumen mining operation. Most people don’t like the idea of a body of water – even one that is man-made and not permanent – that holds toxic waste. There have been incidents in which waterfowl landed on these ponds and died in large numbers. (Syncrude was fined $3 million for the deaths of 1,600 ducks that landed on a tailings pond in 2008). As a result, companies have invested in bird deterrent systems. One of those was clearly visible on my visit – scarecrows made to look like workers surrounding the ponds. They also have air horns and air cannons that go off at regular intervals to keep wildlife away.
There is of course also the fear that the tailings ponds can contaminate waterways. I asked a number of questions on this topic. I was told that there is extensive groundwater monitoring around the tailings ponds (although the data are not easily accessible by the public), and that they do not connect to any public waterways. The ponds are lined with a natural substrate that is semipermeable, and they are designed to withstand a 100 year flood. But “semipermeable” implies that some water does leech out of the ponds.
However, the recent leak of a billion liters of water from a coal containment pond into the Athabasca River is a local reminder that things don’t always go according to plan. Darin Barter, a spokesman for the Alberta Energy Regulator provided a quote that will give anyone concerned about the tailings ponds reason for pause: “I haven’t seen this happen. Coal mine incidents and pit leak incidents are really rare. I was surprised this could happen.”
That really sums up the fears of many when it comes to the tailings ponds. Are they really safe from wildlife, and could they contaminate the waterways? Industry and the government say they are doing all they can to minimize the risks. But we are all aware of major environment incidents where the response was “I didn’t know this could happen.” That’s essentially what German Chancellor Angela Merkel said after the Fukushima nuclear accident in Japan, and that’s essentially why people are concerned about the potential consequences of the tailings ponds.
Ultimately, all tailings ponds are required by law to be reclaimed (something else I didn’t know) after a specific lifetime. Industry is required by law to set aside money to assure this is done. Since tailings ponds can be used in the mine operation for up to 40 years, most of them have yet to be recycled.
So far only one tailings pond has been reclaimed. In 2010, Suncor completed surface reclamation of the 220-hectare Wapisiw Lookout, formerly known as Pond 1. For the next 20 years Suncor must maintain and monitor progress at the site, including the growth of 630,000 shrubs and trees planted in 2010. Regular oil, water, and vegetation monitoring will be done to make sure the site returns to a self-sustaining ecosystem.
I was curious about how reclamation is done, so I asked CNRL on our visit there. The way they do reclamation is to figure out how much the asset is worth, and how much reclamation should cost. The ratio could be $30 billion asset value to $1 billion in reclamation costs. The government then monitors and makes sure they are spending the money as the asset is produced, and complying with their requirements. During the last 10 years of the mining lifetime, they are required to post a financial bond.
One of the issues that is frequently raised with respect to oil sands production is the availability of fresh water. Bitumen production from surface mines requires hot water to separate the bitumen from the sand. In situ production requires steam underground to heat up the bitumen so that it can be pumped. Both processes require fresh water, but both processes rely primarily on recycled water.
The water from the top 10 feet or so of the tailings ponds is recycled back to the process as the tailings settle. Recycled water makes up 80 percent or more of the water requirements for a bitumen mining operation. Some water is lost to the environment during processing, and so makeup water – mostly from the Athabasca River – is consumed. As I mentioned last week, up to 1 percent of the average annual flow of the river can be used for oil sands processing, but this percentage may be higher during seasonal periods of low flow. Pembina Institute is advocating for changes that would restrict withdrawals during the low flow periods.
Industry is anticipating such changes. For example, CNRL has a supply pond that could enable them to run for a month with no withdrawals from the river. Further, their high level of recycle means that they typically don’t use close to the amount they are allotted. In 2010, for example, they only used a quarter of the 79.3 million cubic meters of water that they were permitted to withdraw.
During one of the presentations, we were given a range of 2-4 barrels of freshwater makeup per barrel of bitumen processed via surface mining, with an industry average of 2.2 barrels per barrel.
Water consumption for in situ operations is even lower. The vast majority of the water used to produce steam is from saline ground water unsuitable for drinking, and more than 90 percent of it is recycled. On average, 0.4 barrels of fresh water are used for every barrel of bitumen produced. Cenovus reported that in their Christina Lake facility, only 0.07 barrels of fresh water are required to produce one barrel of oil (less than 5 percent of the total water used).
First Nations Impacts
One of my goals on the trip was to better understand the impact of oil sands development on the people living in the area. In particular, I had heard a lot about negative impacts to First Nations groups as a result of the oil sands development. We had been scheduled to meet with a group on our trip, but that meeting was canceled for some reason. So, I had to rely on a lot of outside research for this section.
Trying to determine the impact on the indigenous people reminded me of when I lived in Germany, and people would ask “What are Germans like?” That’s sort of like asking “What’s an American like?” Well, are we talking about someone living in Texas, New York, or Minnesota? Is the person rich or poor? Are they religious? What is their political affiliation? It turns out that Germans, Australians, South Africans – and every nation in the world – has people that shouldn’t be stereotyped. So I would say “Germans are like everyone else. They are all different.”
I tell that story because that’s the impression I developed after trying to determine the impact of oil sands development on First Nations groups. Some hate it. Some love it. Many work for the companies we visited. Development has brought wealth to some. On the other hand, some don’t like the infringement on their historical lands, and they don’t like the environmental implications. Certain tribes would favor development, and certain tribes wouldn’t. And within those tribes will be individuals who feel differently about it. Some of that will come down to whether there is a sufficient financial benefit relative to the downside. It is not that different from other energy projects. There are always people on both sides of the issue. And if you are being impacted negatively but not compensated financially, you are going to be against.
My point is that it isn’t a black and white issue. So what I will do is just explain what some First Nations groups oppose. In an environmental report on Shell Canada Ltd.’s application to expand its Jackpine oil sands mine, the Mikisew Cree expressed the concern “that the governments of Alberta and Canada were failing to uphold the honor of the Crown in their approach to the assessment and management of cumulative effects in the Lower Athabasca Region.” One specific issue that was mentioned was whether reclaimed land would ever be suitable for traditional land use.
Development in some cases has bordered First Nations’ lands, and of course it is possible for environmental impacts to extend beyond the borders of an oil sands lease. For example, while the Athabasca River has pollutants from natural seepage of oil sands into the river, higher concentrations of polycyclic aromatic compounds (PACs) and heavy metals like Hg and Pb have been measured downstream of oil sands developments. These levels are still within guidelines for drinking water, but the levels are statistically higher. This is a river where people obtain their drinking water, and they do eat fish from this river.
So the message is “There may be a bit more pollution in your water, but it’s still OK to drink from it.” It is not surprising that this is an unsatisfactory answer for most people that are potentially affected.
In my next article, I will move on to the actual processing of the oil sands.
Link to Original Article: Oil Sands and the Environment – Part II
- For those who want an inside edge in the energy sector.
- Written by veteran energy analysts and insiders with a track record of accurately predicting trends.
- 100% FREE!
- And Much More...
2014 EIA Energy Conference
July 14-15, 2014 - Washington, D.C.
Platts 4th Annual NGLs Conference
Sep. 29 - Oct. 1, 2014 - Houston, TX