Researchers see enormous environmental and commercial appeal in the Weyburn Enhanced Oil Recovery Project under construction by PanCanadian Resources.

The project has attracted international attention as a unique opportunity to find out more about the use of CO2 (carbon dioxide) sequestration. Based on these factors and the world-class scale of the venture, these same researchers are in the process of gathering sponsorship for a proposed $23 million research budget to study different stages of the project.

"It is the first commercial CO2 project done on this scale in Canada," said Sam Huang, manager of Gas and Chemical Enhanced Oil Recovery for the Saskatchewan Research Council (SRC). "The SRC is very encouraged and excited about this, because whatever we produce (as researchers) will have value to the oil producer, will be ready to be implemented and commercialized."

"PanCanadian is taking a good leadership role, which is positive for the entire industry," he said. "We will study the entire CO2 injection process, conduct tests to estimate how much oil will be recovered, and how much CO2 is required to make it economically feasible."

The interest stems from 1997, when representatives from 160 nations met in Kyoto, Japan, and agreed to a protocol that mandates reducing greenhouse gas emissions to 5.2 per cent below 1990 levels by 2012 at the latest.

Energy producing countries are grappling with the task of addressing the protocol without negatively affecting their economies, and the PanCanadian project offers a close-up of an affordable alternative that actually puts CO2 to work for a company instead of against it.

"The inception of the research project came about at a International Energy Agency (IEA) workshop in the fall of 1999 at Regina," said Darcy Cretin, manager of PanCanadian Resources in Weyburn. "The purpose of the workshop was to develop an IEA-endorsed research program focused on the sequestration of CO2."

The workshop resulted in a world-class research consortium, comprised of private and public sector research providers from Canada, the United States, and Europe. The Weyburn CO2 Monitoring Project will be performed under the IEA's Greenhouse Gas R&D Program, with the Petroleum Technology Research Council (PTRC), which is associated with the SRC of Regina, acting as coordinator for research on the project.

Under the leadership of PTRC, a research team will be coordinated for each element of the project, for which baseline research is scheduled to begin in May. It was the PTRC that approached PanCanadian about partnering in the project. It is seen as a win-win situation for the company and the researchers.

"As partners, we will have some access to analytical work that we'd have to do anyway," said Cretin. "The project helps better define long-term potential and benefits of making more oil. If there is value in sticking CO2 in the ground, it may make more CO2 projects economical in the future."

By using CO2 this way, PanCanadian may be in the position to collect environmental credits as its project has the potential to become the world's largest joint implementation project aimed at reducing CO2 emissions. Research results will also examine the feasibility of CO2 flooding for smaller oil companies.

PanCanadian will begin injecting about 5,000 tonnes of CO2 per day into a Williston Basin oil field in October. It is expected that some 20 million tonnes of CO2 will be sequestered over the 25-year lifespan of the project. The CO2 will be supplied by pipeline from the Dakota Gasification Company of North Dakota.

The $1.1 billion project is expected to yield at least another 122 million barrels of incremental oil, through miscible or near-miscible flooding with CO2, from a field that has already produced 335 million barrels since its discovery in 1954. PanCanadian believes that the miscible flood project will boost oil production from about 20,000 barrels of oil a day to almost 30,000 by 2008.

The research project will take an estimated four years, during which data will be collected, analyzed and interpreted by the team.

PanCanadian is on track with its construction and drilling schedule, with mild weather allowing uninterrupted work since January. As of month-end in February, Cretin said engineering design was 95 per cent complete and procurement of major equipment was 94 per cent complete. Overall, 54 per cent of construction was complete, with 65 per cent of field construction and 35 per cent of plant construction done.