An Analysis of Industrial Policy Mechanisms to Support Commercial Deployment of Bitumen Partial Upgrading in Alberta

Abstract

Partial upgrading of bitumen (PUB) improves the quality (increases the value) of crude oil from bituminous sands to the level where pipeline specifications are met without—or with reduced use of—costly diluent. By reducing the cost of transportation to downstream refineries, PUB can serve as a solution to market access challenges and takeaway capacity constraints for oil sand producers. However, despite significant government and private investments, proponents in the Canadian province of Alberta still face challenges in commercializing the technology. We used a capacity investment model to explore the expected effects of different policy support types on a firm’s decision to invest in a partial upgrading facility integrated with an existing oil sands extraction facility. We evaluated 10 potential policy interventions and their expected effects on investments in partial upgrading. We focused our analysis of these policy interventions on the revenues and costs of firms, risk sharing, and overall public benefits and costs. We find that the majority of interventions are transferred from government to private interests, with little public benefits. Defensible policy actions include capital investment at the demonstration phase, providing incentives for industry collaboration, equity investment at the commercial stage, and reforming the government’s bitumen valuation methodology.

MXene: A Roadmap to Sustainable Energy Management, Synthesis Routes, Stabilization, and Economic Assessment

“…The technological uncertainties, for instance, the technical limitations of carrying out new formation methods or the availability of materials for MXene in the market with comparable or better properties, can hinder its position in the market and demand. Challenges such as the sourcing of precursors, along with supply chain complications, pose potential limitations on manufacturing scale-up, whereas uncertainty regarding legal IP matters representing intellectual property rights and patents might affect the companies’ competitiveness and market access . To efficiently mitigate such power generation risks, vertical platforms must guarantee different sources of energy precursors, different production strategies, and scenario planning.…”

“…Challenges such as the sourcing of precursors, along with supply chain complications, pose potential limitations on manufacturing scale-up, whereas uncertainty regarding legal IP matters representing intellectual property rights and patents might affect the companies’ competitiveness and market access. 349 To efficiently mitigate such power generation risks, vertical platforms must guarantee different sources of energy precursors, different production strategies, and scenario planning. Partnering with regulatory agencies, constantly monitoring the markets, and making sure that manufacturing technologies are primary in the research and development of MXenes are some of the essential ways that will help a business stay one step ahead and not risk producing in mass.…”

Impacts of Refining Partially Upgraded Bitumen: Vacuum Gas Oil Hydrotreating

“…Canadian oil sand bitumen has been historically transported to the market via pipeline by using diluents or by fully upgrading it into a sweet synthetic crude oil . Partial upgrading of bitumen has been proposed as an alternative to these methods in the face of their long-term economic difficulties. , It is a less complex form of processing bitumen, typically involving a mild thermal cracking process to break up large bitumen molecules and, in certain cases, solvent deasphalting to remove asphaltenes from either the thermally cracked product or the bitumen feed. − The resulting product, commonly known as partially upgraded bitumen (PUB), is a sour synthetic crude resembling a heavy crude oil in bulk properties and requiring no or minimum dilution to meet the pipeline specifications for density (<940 kg/m 3 at 15.6 °C) and viscosity (<350 cSt at 7 °C). A number of partial upgrading technologies have gone through pilot-scale testing, with some having reached the demonstration scale. , …”