What’s a drilling rig doing southeast of Moose Jaw? Drilling a CO2 sequestration well, naturally

BELLE PLAINE – It’s not often, if ever, you see a drilling rig working along Highway 39 due south of Belle Plaine and southeast of Moose Jaw, but there it is.

Ensign Drilling Rig 808 is punching a hole, a deep one. And not for the reason you might think.

The obvious answer would be it’s likely an exploration or production hole for the potash mine just a few miles due north. But that’s not what’s listed on RiggerTalk.com. Instead, the listing is for Whitecap Resources Inc.

A call to Whitecap got an answer from president and CEO Grant Fagerheim, who said it was a CO2 sequestration well going into the Cambrian.

That brief answer, in turn, spoke volumes. That’s precisely what the Aquistore Project wells do just west of the Boundary Dam 3 Integrated Carbon Capture and Storage Project. That project went online in late 2014. Two wells were drilled there, one for CO2 injection, and one for scientific observations of the CO2 and its dispersion deep underground. Those wells were also drilled into the Cambrian, specifically the Deadwood formation, and have been receiving CO2 ever since. When drilled, they were the two deepest wells drilled in Saskatchewan up to that point.

The Petroleum Technology Research Centre developed Aquistore for SaskPower and has been responsible for now over a decade of research tied to it, monitoring everything from ground uplift to temperatures in the wells. A permanent seismic array surrounding the project was just one of the literally dozens of scientific monitoring of the $32.2 million project (up until 2013), which received considerable federal funding through Natural Resources Canada. NRCan put up $14 million, the province, $5 million and industry $13.2 million.

The now 10 years of testing has been critical in asserting the veracity of deep saline geologic storage of carbon dioxide.

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Things are happening

This well, in turn, is an early indicator that Whitecap’s planned carbon hub is indeed coming together.

Back in October, 2021, Federated Cooperatives Limited signed a memorandum of understanding with Whitecap Resources. That memorandum would see CO2 captured at the Consumers Refinery Complex in Regina and the ethanol complex at Belle Plaine. Subsequently, several other larger CO2 emitters in the area signed onto the project. The result will be a carbon dioxide gathering system running from the Regina-Belle Plaine-Moose Jaw area, down Highway 39 to the Whitecap-operated Weyburn Unit, where it will be used for CO2-enhanced oil recovery.

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As for having a sequestration well near the kickoff of the pipeline, that appears to emulate the Aquistore Project, too. There are times when the Weyburn Unit can’t take CO2, particularly due to maintenance. So you have to do something with it nearby – as there’s no sense in capturing carbon dioxide and then releasing it into the air. As a result, whenever the Weyburn Unit is unable to take CO2 from Boundary Dam, that CO2 is shunted into the nearby Aquistore injection well. As of February, 2023, a half million tonnes of CO2 had been injected into Aquistore.

 

The fact Whitecap is emulating the Aquistore project appears to validate it, both in form and in function.

And securing additional CO2 supply is critical for Whitecap’s ongoing CO2-EOR project at Weyburn. An American program called 45Q has essentially placed a floor price for CO2, nearly triple what the current price has been. And with the federal government’s plan to eliminate conventional coal by 2030, the likelihood of the coal mines remaining open for just one relatively small generating unit, albeit one with a $1.6 billion refurbishment and carbon capture unit, is questionable at best. So, with both of its current CO2 supplies at potential risk, the carbon hub will provide an alternative source of continued CO2.

In 2022, when Fagerheim was awarded Saskatchewan Oilman of the Year at the Saskatchewan Oil and Gas Show, Pipeline Online spoke to him at length about the carbon hub. You can read the whole piece here.

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Here’s an excerpt:

Pipeline Online had run into one of Whitecap’s leaders on the CO₂ front at the Williston Basin Petroleum Conference two weeks earlier. At that time, he indicated Whitecap was interested in taking all the CO₂ it could get.

To that end, Fagerheim said: Totally.

Pipeline Online: Do you have all six (CO₂-emitting companies) now, that you wanted lined up in Belle Plaine area?

Fagerheim: Yes.

Pipeline Online: That’s the Regina refinery, Belle Plaine ethanol, and K+S. Who are the other three?

Fagerheim: Yara, Mosaic (Belle Plaine), Evraz in Regina, and we’re in conversations with Gibsons’ (Moose Jaw refinery).

Pipeline Online: So that could be seven, then?

Fagerheim: Yeah. It depends upon the pace they want to decarbonize, right?

Pipeline Online: So what sort of tonnage are we talking about? I think you said two million tonnes per year, at one point?

Fagerheim: Between three and five million tonnes a year.

Pipeline Online: That’s inclusive of the stuff from North Dakota?

Fagerheim: No, that would be on top.

Pipeline Online: So that would be a 24-inch pipeline or so?

Fagerheim: We can’t size it, because we haven’t got it under contract.

Pipeline Online: So, when you first made this announcement last fall (2021), as those were things I kind of clued in on. Basically, everyone’s got to decide if they’re in or not, because that pipeline – once it’s done, it’s done. If you’re not in, you aren’t going to get in.

Fagerheim: That’s right. That’s what needs. So, that is why we’re doing feasibility studies right now. That will include different sizings of pipe, but how much CO₂ we can contract for, and then what we’re able to negotiate commercial terms? So that’s what we’re looking to do.

 

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