Brian Zinchuk is editor and owner of Pipeline Online
The central battery for the Weyburn Unit has capacity for more oil production, but will need more gas processing capacity if more CO2 ends up coming its way. Photo by Brian Zinchuk
WEYBURN – On June 26, 1997, politicians and corporate executives gathered in Weyburn to announce a project that was supposed to extend the life of the prolific but declining Weyburn Unit by another 25 years.
That was 25 years ago, and the Weyburn Unit is still going strong. Indeed, it is a critical component for future plans for carbon capture, utilization and storage for this province, with a major expansion in the works.
The project was initiated by PanCanadian Petroleum Limited, part of the Canadian Pacific empire of companies which at the time reached far beyond trains. Shell had piloted a miscible carbon dioxide flood at the nearby Midale Unit, and now PanCanadian was the principal customer for a new pipeline, bringing carbon dioxide from the Dakota Gasification plant at Beulah, North Dakota, to the Weyburn Unit
The original press release read:
Weyburn, Sask. June 26, 1997 — PanCanadian Petroleum Limited and 36 partners announced today that they are embarking on a $1.1 billion energy initiative that extends the producing life of the Weyburn oil field by more than 25 years. The project will create an estimated 1,400 direct and indirect jobs at the peak of activity and help stimulate long-term economic development and growth in Saskatchewan.
“The Weyburn CO2 miscible flood project will apply high-technology, enhanced oil recovery methods to extract at least 122 million additional barrels of oil from the Weyburn field, a Saskatchewan resource that contained 1.2 billion barrels of oil when discovered in 1954,” said David Tuer, president and chief executive officer of PanCanadian Petroleum.
“This project begins a third phase of oil recovery in Southeast Saskatchewan. It applies leading-edge science to extract another layer of crude oil from the middle of the reservoir barrel,” Tuer said Thursday during a news conference in Weyburn that was attended by local community leaders, business people, oil service contractors, federal, provincial and local government officials, reporters and PanCanadian staff.
“As a critical component of the enhanced recovery, Dakota Gasification Company of Bismarck, North Dakota will build a US$100 million pipeline to ship carbon dioxide 330 kilometres from Beulah, N. D. to a new receiving terminal at the Weyburn Unit. The CO2, which is currently a by-product of its Great Plains Synfuels Plant at Beulah, N.D., will be pumped into the reservoirs to help sweep more barrels of oil out of the ground. The CO2 miscible flood technology is a proven process that swells oil in deep reservoirs to help flow the medium weight oil to the surface.
“Starting late in 1999, we will inject 95 million cubic feet of CO2 a day into the Weyburn oil field. This will help boost declining production at the Weyburn Unit from about 18,000 barrels per day to nearly 30,000 by 2008. The pipeline, feeding Canada’s largest commercial CO2 project, sets the foundation for an international development that will not only help Weyburn, but also other mature oil fields in Southeast Saskatchewan,” said Gerry Protti, PanCanadian’s group vice president operations.
“Construction of the pipeline compressors and new surface facilities at Weyburn will start In mid-1998. The pipeline will be built in the summer of 1999 and CO2 injection will begin in late 1999. The first incremental barrels of oil production will start to flow in 2000.”
Wall Street Journal story from 1997 about the Weyburn Unit. Wall Street Journal
Shell piloted it, but PanCanadian implemented CO2-EOR
Even though Shell had been the first to pilot CO2 enhanced oil recovery (CO2-EOR ) in the area, it did not proceed with a CO2 flood at the same time PanCanadian did. Shell sold the Midale Unit to Apache Canada. Several years later, Apache signed on to CO2 deliveries from the Souris Valley Pipeline, the pipeline which brought the CO2 from Dakota Gasification in Beulah, North Dakota. This was the initiation of Apache’s own CO2 miscible flood program.
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“PanCanadian had to buy Shell out of the Weyburn Unit as a partner, because they weren’t going to support the project,” said Darcy Cretin on June 20. PanCanadian acquired Shell’s 25 per cent ownership of the Weyburn Unit, bringing it up to 69 per cent and the majority stakeholder.
Cretin knows a thing or two about the history, since the 25 year anniversary is also his 25th anniversary as superintendent of the Weyburn Unit. He was brought in at the initiation of the project and present for the press conference announcing it.
Cretin said PanCanadian had contracted for 40 per cent of Dakota Gasification’s CO2 capacity.
Click here for 1997 Landowner Information Package in PDF form
The Souris Valley Pipeline, which supplied all the CO2 for the Weyburn Unit until 2014, was built with expansion in mind. Additional compression allowed for volumes of carbon dioxide to be shipped to Midale. Cretin noted that it was purposely routed through western North Dakota oilfields, should any oil company wish to tie into it. None did, except for the Midale Unit.
In 2002, PanCanadian became EnCana, which split into EnCana and Cenovus in 2009. Whitecap Resources purchased the operating stake from Cenovus in 2017, being the first company outside the direct succession of companies to take majority ownership.
This is what the initial expectation was for the Weyburn Unit. The red portion is the increased production due to CO2. it was expected to peter out by now, but that has not happened. Image courtesy Whitecap Resources.
20-30 years of life left – since the 50s
The discovery well for the Weyburn Unit was spudded Nov. 12, 1954 by Central Del Rio, with this year marking the 68th year of oil production for a field that was only expected to last a few decades.
Indeed, Cretin said, “The story I tell is, if you talk to any of the guys who are still around who started in this field in the 50s, and 60s; every decade, every new hire was told we probably have 20 to 30 years worth of life in the field. And if we hire a new operator tomorrow, we’re probably going to tell him the same thing. So, from the 50s, till now, we’ve always been saying there’s another 20 years of life. And sitting here 25 years later, there’s another 25 years of life left.”
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At some point, long range forecasts become academic. Cretin said, “I know the forecasts we do, internally and as an industry, we tend to look out 20 to 30 years. And I think that’s because beyond that, we don’t necessarily have the ability to accurately forecast what’s going to happen from our wells, but also the price of oil and royalties. You’re so far ino the future, dealing with future dollars today.
“I think companies tend to look at 20, 25 year forecasts, because that’s where their graph just ends. Not because we think the oil production is going to end, but you don’t have the ability to accurately predict past that, and the value of what you’re spending or producing,” Cretin said.
Recovery factor
“The other number I share is the Weyburn Unit has 1.5 billion barrels of original oil in place, and we’ve currently recovered just over 500 million barrels. So there’s a billion barrels of oil still in this reservoir.”
That means a recovery factor of basically one third, to date. Cretin said that primary production might get 10 per cent, and secondary recovery via waterflood might make that 30 per cent recovery in a good reservoir.
This is the actual production of the Weyburn Unit until now. Note the green portion due to CO2 flooding. It is a much flatter decline than what was originally expected. Graphic courtesy Whitecap Resources
Employment
As for employment, he said, “Our staff count has been pretty stable. We bounced in the 55 to 65 employee range from the late 90s to today.
“A normal year, currently we’ve got four service rigs, one drilling rig. We’ve got pipelining, so there’s probably conservatively 150 jobs in the field over and above our staff – just contract workers associated with all of our day-to-day maintenance and capital programs.
“And there were some years in the 2003-08 timeframe when we were dealing with two drilling rigs, doing some pretty significant rollouts. We were probably peeking out at 300-plus contractors working in the field.”
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Evolving patterns
Those patterns he referred to are the method of injecting CO2 and water into the field. Imagine you have a tic-tac-toe grid. Initially, CO2 was injected into the centre square, and the surrounding eight wells were producers. Over time, more wells were converted to injectors, such that every second well was an injector. And as time went on, that ratio increased even higher.
“We almost went from the center square being an injector and all the surrounding squares being producers, to now just about every producer is surrounded by injectors.”
The current ratio is now about two producers for every injector.
Weyburn Unit. Photo by Brian Zinchuk
The original rollout was 19 patterns, with an initial plan for 75 injection patterns. That plan has been long since exceeded. “We’re already over 90 injection patterns” he said.
The original plan was for $1.1 billion in expenditures – $600 million for the purchase of CO2, and the rest in capital expenditures to implement it. That number has since been exceeded.
The formation being produced is the Midale, with the Vuggy and Marley units of that formation targeted. It’s about 1,450 metres deep.
Next phase – more expansion
And this is where the future becomes much more intense. The source of the CO2 coming into the Unit is in flux, as contracts for CO2 supply from both Dakota Gasification and SaskPower’s Boundary Dam Unit 3 are coming due. Whitecap is in the process of developing a carbon hub for southern Saskatchewan.
Whitecap CEO Grant Fagerheim explained it to Pipeline Online on June 1, which you can read in depth here. Whitecap is working out arrangements with the Federated Cooperatives Limited Regina refinery, and Belle Plaine ethanol plant, potash miners K+S, and Mosaic (Belle Plaine), Yara, Evraz in Regina, Gibsons’ (Moose Jaw refinery). The potential is to add as much as five million tonnes of CO2 per year to the Weyburn Unit. As for the current two million tonnes coming from Dakota Gasification and SaskPower, that is dependent on coming to new agreements as the current long-term agreements expire.
Cretin noted that the Weyburn Unit once produced almost 50,000 barrels per day, so they have the capacity to handle substantially more oil. But they would need to increase gas processing capacity to deal with the additional CO2.
“You’re going to need more wellbores to take that increased volume of CO2, and assuming you produce it back, using it for enhanced oil recovery, you need more recycle compressors. So it all leads to a lot of ongoing capital investment,” Cretin said.
He pointed out that the Weyburn Unit is a “pretty small little piece of that pie,” with reference to southeast Saskatchewan. There’s a lot of potential for expanded CO2-EOR in the region.
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