Capture Unit Nearly Two-Thirds Done, Expected to be Complete in March, Officials Say
Tamar Hallerman
GHG Monitor
08/31/12
ESTEVAN, Saskatchewan—Construction of the capture unit at SaskPower’s Boundary Dam Power Station is rapidly continuing here as workers add nearly a foot in height daily to a cinderblock tower housing the plant’s CO2 and SO2 absorbers. Project developers here estimate that construction of the capture unit—which includes the 170 foot tall CO2 absorber and a massive 250 ton CO2 stripper already in place—is about 65 percent complete. “We’re on time and on budget,” said Mike Monea, president of Carbon Capture and Storage Initiatives at SaskPower, the provincial utility spearheading the $1.24 billion Boundary Dam carbon capture and storage project, in an interview. “Everything is in tact.”
SaskPower is rapidly moving ahead with retrofitting the plant’s 44-year-old Unit 3 with Cansolv’s post-combustion amine capture technology, trudging along on what is expected to be the world’s first integrated post-combustion CCS demonstration plant. SaskPower officials said they expect work on the capture unit to be completed by March 2013. At that point, engineers will take Unit 3 offline so that many of its parts—from its turbine to its boiler—can be refurbished. The utility hopes to have all complete by fall 2013 so it can do a hot test ahead of full operation in first quarter 2014. The project was approved by Saskatchewan’s provincial government in spring 2011, and once fully operational is expected to generate roughly 110 MW of electricity and capture a million tons of CO2 per year. The Canadian government previously contributed around $240 million to help develop the project.
SaskPower Finalizing CO2 Offtake Contracts
In an interview with GHG Monitor this week, Monea said that SaskPower is currently finalizing offtake contracts with nearby oilfields for use of the plant’s captured CO2 in enhanced oil recovery operations. He said that all will likely be finalized within the next several weeks. Monea added that the company is seeing significant interest in Boundary Dam’s CO2. “We’re very fortunate. We have a few offtakers that are very interested in buying the CO2. We’re working through different term sheets and I would say by the 15th of September, we should have a contract awarded to one or two or several offtakers for the full amount of CO2,” Monea said. To account for any lags in the schedule for when Unit 3 is capturing CO2 but its offtakers are not yet ready to accept the commodity, Monea said the project will give up to 2,000 tons a day of CO2 to the Petroleum Technology Research Centre’s Aquistore project, which rests about a mile away on SaskPower property.
Monea said that the sale of the CO2 for enhanced oil recovery operations—as well as sulfuric acid produced onsite—has been the driving force for making the plant economically feasible. “If we didn’t have EOR sales, it would have been real iffy to build this plant,” Monea said in speech at an International Energy Agency EOR conference this week in Regina, Saskatchewan. “We had to take a leap of faith that we would be able to find a serious offtaker to take our CO2, and we’re very fortunate that we have some very good companies that are looking at buying and using our CO2. We’re very lucky.”
Emissions Performance Standard Helped Push Project Forward
SaskPower was incentivized to move forward with the project quickly due to an emissions performance standard proposed by the Canadian federal government last summer. If finalized in its current form, the rulemaking would require Boundary Dam’s Unit 3—which is classified as at the end of its economic life by the Canadian government—to install CCS or switch to natural gas combined cycle in order to meet the 375 tons CO2/GWh standard. Monea said that when faced with the initial decision about whether to retrofit or switch to natural gas, SaskPower, which relies on coal for more than half of its electricity generation, decided to see if coal could be economic in the future using CCS. “We have to replace 135 MW some way. At that time [that we made our investment decision], it was the same cost to put in a natural gas plant on lifecycle costs as to rebuild a coal plant. But on a coal plant you’re actually capturing carbon and on a gas plant you’re not,” Monea said. “With CCS, we’re creating another industry with EOR, plus we’re answering the question of whether coal can stay in the mix for SaskPower in the future. If we can answer that question, then many other companies can learn from us and perhaps answer that same question for themselves.”
SaskPower’s experience with Boundary Dam’s Unit 3 will likely affect what the utility will do with several of its other aging units at the plant. SaskPower will have to make similar investment decisions on most of the facility’s remaining coal units over the next decade.
