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The development of a techno-economic model for the extraction, transportation, upgrading, and shipping of Canadian oil sands products to the Asia-Pacific region

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  • Sapkota, Krishna
  • Oni, Abayomi Olufemi
  • Kumar, Amit
  • Linwei, Ma

Abstract

The diversification of Canadian oil sands markets is imperative for the long-term economic growth of oil sands products. To ensure a competitive place in the global market, supply chain costs of oil sands must be as low as possible. This study conducts a comparative techno-economic analysis of potential pathways for the transportation of Canadian oil sands products (synthetic crude oil and diluted bitumen) to seaport destinations in the Asia-Pacific region. We developed data-intensive techno-economic models to estimate total supply chain costs from the production site in Alberta to ports in China, Japan, and India. Four pathways were developed using production (steam assisted gravity drainage), transportation (production-upgrader-port in Vancouver), upgrading, and shipping operations. A sensitivity analysis was conducted to identify cost ranges with their occurrence probability measures and evaluate the effect of key parameters for each stage of operation. Supply chain costs (C$ per barrel of bitumen) to China, Japan, and India are from 61–87, 60–86, and 62–90, respectively. Overall supply chain costs of dilbit (a blend of bitumen and diluent) and synthetic crude oil (SCO) are affected most by production and upgrading costs. The production and upgrading costs are influenced by capital cost, while pipeline lifetime and capacity highly impact transportation (pipeline) and shipping costs, respectively. The developed models can be used to predict total supply chain costs of different pathways in Canadian oil sand markets.

Suggested Citation

  • Sapkota, Krishna & Oni, Abayomi Olufemi & Kumar, Amit & Linwei, Ma, 2018. "The development of a techno-economic model for the extraction, transportation, upgrading, and shipping of Canadian oil sands products to the Asia-Pacific region," Applied Energy, Elsevier, vol. 223(C), pages 273-292.
    • Handle: RePEc:eee:appene:v:223:y:2018:i:c:p:273-292
    DOI: 10.1016/j.apenergy.2018.04.047
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    1. Verma, Aman & Nimana, Balwinder & Olateju, Babatunde & Rahman, Md. Mustafizur & Radpour, Saeidreza & Canter, Christina & Subramanyam, Veena & Paramashivan, Deepak & Vaezi, Mahdi & Kumar, Amit, 2017. "A techno-economic assessment of bitumen and synthetic crude oil transport (SCO) in the Canadian oil sands industry: Oil via rail or pipeline?," Energy, Elsevier, vol. 124(C), pages 665-683.
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    1. Rui Xing & Diego V. Chiappori & Evan J. Arbuckle & Matthew T. Binsted & Evan G. R. Davies, 2021. "Canadian Oil Sands Extraction and Upgrading: A Synthesis of the Data on Energy Consumption, CO 2 Emissions, and Supply Costs," Energies, MDPI, vol. 14(19), pages 1-14, October.
    2. Radpour, Saeidreza & Gemechu, Eskinder & Ahiduzzaman, Md & Kumar, Amit, 2021. "Development of a framework for the assessment of the market penetration of novel in situ bitumen extraction technologies," Energy, Elsevier, vol. 220(C).
    3. Omidkar, Ali & Haddadian, Kamran & Es'haghian, Razieh & Alagumalai, Avinash & Li, Zhaofei & Song, Hua, 2024. "Novel energy efficient in-situ bitumen upgrading technology to facilitate pipeline transportation using natural gas: Sustainability evaluation using a new hybrid approach based on fuzzy multi-criteria," Energy, Elsevier, vol. 297(C).
    4. Wadim Strielkowski & Irina Firsova & Inna Lukashenko & Jurgita Raudeliūnienė & Manuela Tvaronavičienė, 2021. "Effective Management of Energy Consumption during the COVID-19 Pandemic: The Role of ICT Solutions," Energies, MDPI, vol. 14(4), pages 1-17, February.

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