Optimizing energy production with integrated CCS technology for CO2 emissions mitigation in the Canadian oil sands industry

Abstract The forecasted energy production of oil sands operations in Alberta in the year 2030 were optimised under CO2 emissions constraints, using a mixed integer linear optimisation model. The model features a variety of technologies (with and without CO2 capture), including coal and natural gas power plants, IGCC, and oxyfuel plants. Hydrogen production technologies are steam methane reforming and coal gasification. The optimization is executed at increasing CO2 emissions reduction levels, yielding unique infrastructures that satisfy the energy demands of the oil sands industry at minimal cost. The economic and environmental impacts of the optimally chosen technologies on the forecasted operations of the oil sands industry in 2030 are thus determined. The maximum CO2 emissions reduction attainable by using CCS in the oil sands industry in 2030 is 39% with respect to a business-as-usual baseline. This CO2 reduction results in an energy cost increase of roughly 20% for synthetic crude and 2% for bitumen production. CO2 reductions ranging from 0–35% can be attained by optimising the energy infrastructures, yielding energy production cost reductions between 9%–18%. The maximum CO2 intensity reduction is 46% for synthetic crude and less than 3% for bitumen. Energy conversion and CO2 capture account for the bulk of the energy costs for synthetic crude whereas transport and storage combined contribute between 2.6% and 5% over the entire range of CO2 reductions. The optimal energy production technologies are strongly dependent on the CO2 reduction targets. Power production without capture, predominantly NGCC and supercritical coal technology, is optimal at CO2 reduction levels of up to 30%. At higher CO2 reductions, only NGCC with capture and Oxyfuel plants are optimal. H2 production via coal gasification is optimal for CO2 reduction levels of 35% and lower. Above 35% reduction, steam methane reforming with capture is the dominant technology.