Weyburn Carbon Capture Site Sees Boost From Provincial Government

Weyburn is currently home to one of the world's largest enhanced oil recovery carbon capture utilization and storage projects that is operated by Whitecap Resources.

Yesterday during a press conference held at the Weyburn unit Energy and Resources Minister Bronwyn Eyre announced what the provincial government's key priorities to advance private sector investments in carbon capture utilization and storage (CCUS) would be.

“We want to build on Saskatchewan’s energy strength and make our province the most competitive jurisdiction in Canada to invest in CCUS technology and infrastructure,” Eyre said. “Saskatchewan is already a world leader in carbon capture, particularly with enhanced oil recovery (EOR), which leading environmentalists agree countries can’t achieve Paris Accord Targets without. CO2 EOR also emits 82 percent fewer emissions than traditional extraction methods.”

This internationally recognized world-class project has safely captured over 34 million tonnes of CO2. In 2019 and 2020 the Weyburn project stored approximately two million tonnes of CO2 which means they sequester more CO2 than their yearly corporate emissions (direct and indirect), making Whitecap Resources a carbon negative company.

Whitecap Resources is a Canadian clean energy company that provides sustainable long-term growth as well as world-class carbon capture and storage technology.

"We're expecting to continue to grow at our business as we move forward into the future with more capital, therefore, creating more jobs," told Grant Fagerheim, CEO of Whitecap Resources. "With the recent regulatory rules that have come down from the federal government, we believe that carbon capture becomes a greater influence to Canadians. So that would mean more opportunities for us to create more jobs while spending more capital to advance forward, more specifically in the Weyburn area."

Whitecap has a 65.3% operated working interest in the Weyburn Unit which produces primarily light oil. The Weyburn Unit has been in existence since the 1950s when it was discovered. Waterflood operations commenced in the 1960s with a world-class CO2 enhanced oil recovery development commencing in 2000. Significant expansion opportunities remain to expand the Weyburn CO2 flood and further mitigate a low 3-5% base decline rate in conjunction with a very low maintenance capital requirement.

"We're the only net negative emitter in the energy space around the world actually," Fagerheim stated. "We pride ourselves with the team we have on the ground right there in Weyburn. We have a very strong group of employees and families. We like to support in the area of health and education for children as well as any sporting activities for children. We really want our people to be engaged with what thrives communities. That is whether it's through capital or maybe it's volunteer work or lunch programs. Whatever we can possibly do to advance and be helpful to the community and oil business community we'll continue to do that."

The Government of Saskatchewan anticipates that CCUS projects will attract provincial investment of more than $2 billion and sequester over two million tonnes of CO2 annually.

With this strategy, Saskatchewan will aim to:

• Expand the provincial pipeline infrastructure Oil Infrastructure Investment Program (OIIP) to include CO2 pipeline projects;
• Work with the energy sector to evaluate the EOR royalty regime to ensure that CO2 injection projects remain highly competitive;
• Amend and clarify regulations to support investment and provide certainty around pore space ownership, access, unitization of high-potential EOR plays, and long-term obligations and accountability for CO2 storage;
• Explore opportunities for CCUS infrastructure hubs and distribution models, including for the Regina-Moose Jaw Industrial Corridor to Southeast Saskatchewan and Greater Lloydminster areas; and
• Advance the development of a CCUS GHG credit generation program, recognized under Saskatchewan’s emissions management framework, focused on predictability and minimal administrative burden for industry prior to investment and the maximization of credit generation for captured and sequestered CO2.

Increasing the potential availability of CCUS hubs and facilities will also encourage further development of hydrogen production and enable hydrogen producers to further reduce their environmental footprint by storing CO2 underground.

Despite numerous recent changes to federal emissions standards and targets, the province’s CCUS priorities will aim to provide stability and certainty for the energy sector as it contemplates significant investments in CCUS projects.

The Government of Saskatchewan continues to call on the Federal Government to engage with the province to advance these priorities, which will help meet federally-mandated emission targets. The province is seeking prioritized federal funding for CCUS projects, infrastructure hubs, and the development of a CCUS tax credit announced in the 2021 federal budget. This past spring, the Government of Saskatchewan invited federal Ministers to tour provincial CCUS operations. That invitation remains open.

In July, as part of Saskatchewan’s efforts to reduce emissions under federally-imposed measures, the province wrote to federal Environment Minister Jonathan Wilkinson requesting financial assistance to build additional CCUS facilities on SaskPower’s coal-fired generation units to support Estevan workers, the environment, and the economy. Saskatchewan currently has 12 CO2 EOR projects in operation, as well as SaskPower’s Boundary Dam Unit 3 (BD3) carbon dioxide capture project, which opened in 2014. BD3 is the world’s first fully integrated post-combustion CO2 capture and storage project and has captured over four million tonnes of CO2 to date.