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A plan to save coal, power generation, and the oil industry in southeast Saskatchewan

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From the Frontier Centre for Public Policy

By Brian Zinchuk

Stop moving to shut down Saskatchewan coal – it could be the salvation of our oil industry

What if there was a way to keep coal mining jobs in Saskatchewan, continue to produce low-cost electrical power, and extend the production of a substantial portion of Saskatchewan’s oilfields not by decades, but by generations? And in doing so, we could still dramatically reduce carbon dioxide emissions, and maybe save some money by reducing our nuclear rollout?

All of this is now possible, and it has everything to do with keeping our coal miners digging and our coal-fired power plants going, maybe even renewing them.

There was a potentially major development for Saskatchewan’s energy sector buried in Whitecap Resources Inc.’s year-end financial report released on Feb. 21. Whitecap said about using CO2 for enhanced oil recovery, “We have also recently started CO2 injection at a pilot CO2 flood into the Frobisher formation underlying the Weyburn Midale unit. We drilled two (2.0 net) producer wells and three (3.0 net) injection wells in 2023 and initiated CO2 injection in late 2023. Early results are encouraging with a notable production response coming through approximately one month after injection, increasing oil rates on the two producer wells from approximately 40 bpd to over 200 bpd, per well. Further technical analysis to determine commerciality and large-scale development is ongoing, and we will provide updates as next steps are determined.”

While the Bakken formation got all the headlines starting around 2007, the reality is in southeast Saskatchewan, very few Bakken wells are drilled these days. Most of the activity has been Frobisher wells, especially around Steelman, where it has been targeted for decades. So if the Frobisher responds well to tertiary recovery through carbon dioxide floods, it opens up a lot of possibilities for extending the life of some of Saskatchewan’s most prolific oilfields, taking recovery rates from the mid-20 per cent range to over 50 per cent.

Back in 2012, Canadian Natural Resources Limited president and CEO Steve Laut expressed interest in using CO2 for enhanced oil recovery in the Steelman Unit.

Whitecap’s initial results were not a five per cent improvement, or 50 per cent, but five times higher. That’s something everyone, including the provincial government, should take notice of. Imagine if you could increase crop production from 60 bushels to the acre to 300 bushels? Or quintuple potash or uranium production from certain mines? You’d be an idiot to not at least take a hard look at it.

I’m not suggesting it will remain anywhere close to that level, but the fact the CO2 flood in the Weyburn Unit, in the Vuggy and Marly units of the Midale formation, has already dramatically increased recovery rates and lengthened the lifespan of a field that otherwise would have long gone dry is significant. If the same process can be expanded to the much more prolific Frobisher formation, that’s a very big deal.

Even if it was a 25 per cent improvement – that’s well worth investigating.

Frobisher is a big deal

How prolific is the Frobisher?

Most of the drilling activity in southeast Saskatchewan follows a certain pattern. The majority is along the Frobisher subcrop – the edge of the formation where it pinches out, forming a structural trap. Of the 16 rigs working in Saskatchewan on March 3, it’s a good bet 10, and possibly more, were drilling Frobisher wells. The daily well report for March 3 published by the Ministry of Energy and Resources shows out of 19 wells listed that day in Estevan area of responsibility, all 19, across five oil producers, were either targeting the Frobisher. It may be a fluke all that day showed the Frobisher, but it definitely shows its significance.

So if Whitecap, which has been growing to be one of Saskatchewan’s largest oil producers, has found a way to substantially increase production from this formation, shouldn’t we take a hard look at how we can take advantage of it?

Stop the process of winding down coal

There’s one thing we should do right now – stop this idea of shutting down our coal-fired power plants near Estevan. You hardly hear SaskPower mention coal-fired power anymore. I keep hearing how those plants are getting enough maintenance to just get them to the planned phase out of 2030, but not likely a day beyond that. The way things are going, they’ll likely limp to the finish line, but not an inch past that. Similar things are said to me about the mines and their iron.

I’m suggesting we should strongly reconsider that. Pour some money into keeping both the power plants and the mines viable should we choose to extend their lives beyond 2030.

The Government of Saskatchewan and SaskPower should have some real serious discussions with Whitecap, and possibly other oil companies like CNRL, about the possibility of dramatically increasing carbon capture and producing as much CO2 as we can. That means putting carbon capture on Shand Power Station. But it could also mean either refurbishing Boundary Dam Unit 6 or, shockingly, building Shand Unit 2, and maybe even Unit 3, with High Efficiency Low Emissions (HELE) technology, designed from the ground up with carbon capture running from Day 1.

One might say that’s going to cost billions, and you’d be right. But I dare say doing so will cost less than just one 300 megawatt small modular reactor, whose price is not yet known, but previous SaskPower Minister Don Morgan said could run between $3 and $5 billion.

It’s going to take a long time to squeeze the first megawatt out of that first reactor. If everything goes to plan (and it never, ever goes to plan with nuclear), we might see the first SMR megawatt around 2034-35. Putting CCS on our existing coal fleet, and maybe, dare I say, expanding it, with HELE and CCS, could help bridge the gap in the interim until we get several SMRs up and running, and have become proficient in their operation. That’s baseload power that won’t go to zero like wind does every so often, and solar does every night.

Doing so would keep the Estevan economy rolling, not just from coal mining and power generation, but also oil production.

I’ve been writing about the Saskatchewan oil industry for almost 16 years now, and I am increasingly alarmed by the fact I haven’t seen the “next big thing,” in southern Saskatchewan. Drilling numbers keep on their slow decline. Companies like Crescent Point have largely lost interest and are pouring their capital expenditure money into exciting Alberta plays. That may be great for Alberta, but Saskatchewan needs to do something to keep things going here. That we’ve kept oil production relatively flat for the last 23 years is a small miracle. But if we don’t get a lot more new investment, it won’t stay that way.

The Sask Party provincial government a few years ago set a bold goal of increasing oil production from the current 454,000 barrels per day to 600,000 barrels by 2030. I asked Premier Moe about that in my year end interview with him last December. He said he thought it was a modest goal.

But as I pointed out to him, and Energy and Resources Minister Jim Reiter, I’m not seeing evidence of the province moving to make that happen.

This is something the Government of Saskatchewan, through its Crown corporation SaskPower, can do. If we tell the feds to stick it when it comes to shutting down coal by 2030, if we put carbon capture on existing units and even build new coal units with carbon capture, then supply that CO2 to companies like Whitecap, and maybe others like Canadian Natural Resources Limited, we could extend the life of our most prolific play in southeast Saskatchewan. We might even increase its production while we’re at it. All the while, we’d be ensuring baseload power production.

This plan’s impact would be measured in generations, not an election cycle, or a corporate quarter.

And it might also save us some money by reducing our nuclear expenditure.

But action has to be taken now. Because if we let those power plants and mines slide past the point of no return, an opportunity may be lost that we will be kicking ourselves for later.

We can’t let that happen.

Brian Zinchuk is editor and owner of PipelineOnline.ca, and occasional contributor to the Frontier Centre for Public Policy. He can be reached at [email protected].

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Economy

Trump’s Promise Of American Abundance, Fueled By ‘Liquid Gold’

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From the Daily Caller News Foundation

By JAMES P. PINKERTON

 

One of the brightest nuggets of policy in Donald Trump’s July 18 acceptance speech to the Republican convention in Milwaukee was his ode to “liquid gold.” That is, oil.

As part of his inflation-fighting plan, Trump offered a gleaming solution: increase energy production, thereby decreasing energy prices. “By slashing energy costs,” Trump declared, “we will in turn reduce the cost of transportation, manufacturing and all household goods.”

He continued: “We have more liquid gold under our feet than any other country by far. We are a nation that has the opportunity to make an absolute fortune with its energy.”

Indeed. According to the Institute for Energy Research (IER) technically recoverable oil resources in the U.S. total 2.136 trillion barrels. At the current price of around $80 a barrel, that’s some $171 trillion. And so, Trump concluded, “we will reduce our debt, $36 trillion.”

As former Alaska governor Sarah Palin would say, “You betcha.” In Palin’s Alaska, oil is so abundant, relative to the population, that everyone gets a check from the state. Last year, it was $1,312. For a family of four, that’s more than $5000. Our goal should be that every American gets such an energy dividend.

Moreover, the abundance of America’s carbon fuels is not limited to oil. According to IER, we have 3.391 trillion cubic feet of natural gas. That’s worth $165 trillion.

To be sure, these staggering dollar totals can’t be counted directly against the national debt—or in support of some future tax cut. Yet every dollar of our energy assets would contribute to the economy, and if even 10  percent of the humongous total could be available to the public, we could, in fact, pay off the national debt.

Moreover, thanks to fracking and other enhanced recovery techniques, we keep finding more energy: Human ingenuity has upended old beliefs about energy shortages, ushering in an almost Moore’s Law-ish surge in production.

Indeed, there’s so much oil and gas (and coal) that an emerging school of thought holds that carbon fuels aren’t “fossil” at all, but rather, the product of earth’s vulcanism. The core of this earth, after all, is the same temperature as the surface of the sun. Perhaps all that heat is cooking something.

In any case, we keep finding more oil, and not just in the U.S.

So how, exactly, do we take advantage of this planetary cornucopia? As Palin said, as Trump said, and as the convention crowd chanted, “drill, baby, drill.”

Okay, but what about climate change? Most Republicans don’t worry too much about that, but if Democrats do, they should be reassured that we can capture the carbon and so take it out of the atmosphere. Trees and other green vegetation have been capturing carbon for eons; the element is, in fact, vital to their very existence. Similarly, the human body is 18 percent carbon. Yes, all of us ourselves are carbon sinks.

So we, being smart, can capture vastly more carbon — capturing it in everything from wood to cement, from plastics to nanotubes. These in turn can be landfill, construction materials — maybe even a space elevator.

We can, in fact, establish a a circular carbon economy: carbon fuels extracted, burned, and then recycled back into feedstocks. By this reckoning, carbon fuels are renewable. Such creative thinking can power all those energy-hungry data centers on which Big Tech and AI depend. So there’s the makings of a bipartisan “Grand Carbon Bargain,” uniting mostly blue-state tech with mostly red-state energy. More energy + more tech = more wealth for all.

In Milwaukee, Trump spoke of American “energy dominance,” and that’s great. But with all the energy we can produce and consume, we can speak of economic abundance — and that’s even greater.

James P. Pinkerton served in the White House domestic policy offices of Presidents Ronald Reagan and George H.W. Bush. He is the author, most recently, of “The Secret of Directional Investing: Making Money Amidst the Red-Blue Rumble.”

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Energy

The Flood Of Energy Absurdities Never Slows

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From the Daily Caller News Foundation

By DAVID BLACKMON

 

I often write about absurdities in the energy space, the kinds of stories in which nothing seems to make sense and which result in the wasting of massive amounts of money on rank boondoggles.

Indeed, I maintain an entire Substack focused on what is an amazingly target-rich environment.

Despite enjoying such a wealth of absurd potential content, I found myself suffering from a bit of writer’s block Tuesday morning — thanks in large part to all the breaking news about debates and attempted assassinations  permeating our society in recent days. But that was before two gloriously absurd stories popped into my in-box.

The first of these absurdities comes to us from the ritzy Massachusetts island of Nantucket, where debris from one of President Joe Biden’s vaunted offshore wind monstrosities — speaking of rank boondoggles — was found littering the beaches in recent days. The Nantucket Current reports that the debris, apparently hard fiberglass material from a broken blade, originates from the Vineyard Wind 1 offshore project, whose first ten massive turbines were activated less than a month ago.

So much for that advertised 30-year life, huh?

The operators of Vineyard Wind said the debris is the result of an “offshore incident” in which a blade suffered damage. The company also characterized the debris as “non-toxic fiberglass fragments,” adding that they are “not hazardous to people or the environment.”

No word from the company on the nature of this “incident,” or on how frequently Nantucket residents can expect such litter from their 62 government-subsidized, 850-feet-tall turbines (almost the height of the Eiffel Tower) and blades to wash up on their beaches. But the fact that the first “incident” came during the first month of operations was not exactly encouraging.

Then the story got even worse for Vineyard Wind: Boston.com reported Tuesday that Nantucket officials made the decision to close the beaches to public access due to dangers from what they called “floating debris and sharp fiberglass shards” that were part of the debris. Worse still, the Federal Bureau of Safety and Environmental Enforcement announced late Tuesday the development’s operations have been “shut down until further notice” due to the safety hazards to the public.

Despite the inconvenience and potential hazards caused by Biden’s offshore wind boondoggles, we can be sure that Nantucket residents will enjoy paying their future power bills that are being inflated by the power-provision guarantees deftly negotiated by their state leaders. It is, after all, a small price to pay for such a glorious virtue signaling opportunity.

The next story comes to us from a report at LiveScience.com detailing a new study predicting that earthquakes will now be caused by the all-knowing, all-seeing, all-causing, all-powerful boogeyman we refer to as “climate change.” No, really, I swear I’m not making that up. Promise.

It is a real report, headlined, “Will we have more earthquakes because of climate change?”

Naturally, the story suggests this will be the case. What else would a good climate alarmist say? It is a requirement for researchers to blame literally every bad thing in our lives on climate change because, if you don’t, you won’t get that next government grant, now, will you?

That is the game. It has been the game for 30 years now, and many believe the net effect has been the increasing corruption of what we call “science.” The raising of outlandish claims such as this in glaring headlines or by hyperventilating weather people on our local news channels is exactly why a constantly rising percentage of the population holds the field of climate “science” in contempt.

One X user who tweeted this story out said: “I miss the days when we used to blame witches.” That is really funny. I wish I had thought of it first.

I know this frustrates all the alarmists out there, but I am just the messenger here. If you want the winds of public attitudes to ever shift in your direction, you are going to have to stop spreading ridiculous nonsense like this. All your cynical efforts to raise alarm are backfiring, and it could not happen to a more deserving bunch of people.

David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.

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