Continued reliance on natural gas for thermal bitumen extraction will severely stunt the currently expected growth of Alberta oilsands production, the industry has been warned.

Unless the gas habit is broken, output is projected to run into a provincial greenhouse gas emissions cap in nine years and about one million b/d short of development currently anticipated by 2040.

The warning emerged from a study by the Fraser Institute, a conservative research house. The results feed opposition on the political right against a cleanup step by the left-leaning New Democratic Party (NDP) provincial government.

The NDP insists that Alberta has to green its industrial act to obtain acceptance of pipeline projects needed to secure national and international markets. The regime’s commitments include enacting a ceiling of 100 million tons per year on oilsands carbon emissions.

Production companies, bruised by defeat of the Keystone XL pipeline proposal in the United States, are avoiding partisan political duels and participating in a provincial task force created to implement the cap with a minimum of economic damage. The group, appointed by the NDP, includes representatives of corporate and green organizations.

The institute study highlights results of relying on oilsands production methods adopted long before carbon emissions became a priority concern of environmental groups and government policies.

All output, currently 2.3 million b/d, relies on use of hot water or steam to separate oil from the sandy bitumen ore that carpets 142,000 square kilometers (55,000 square miles) of northern Alberta. The approach dates back to the 1920s.

Production sites fire their boilers with an overall average of about one thousand cubic feet of natural gas per barrel of oil production. Carbon dioxide exhaust per barrel ranges from 45 kilograms at open-pit mines to 67 kilograms (147 pounds) at in-situ underground extraction plants. Total emissions are currently about 70 million tons per year.

The Fraser study, projecting current development trends, foresees rising reliance on in-situ extraction and accelerating carbon emissions as a result. Mine costs are higher, and suitable shallow deposits are limited to a 4,800-square-kilometer (1,850-square-mile) area north of Fort McMurray.

The 100-million-ton emissions cap will be hit in 2025 when currently active projects hit 3.8 million barrels per day, the Fraser study forecasts. Projections by industry and the National Energy Board rate the oilsands potential as 4.8 million b/d by 2040.

The legacy production methods have made the oilsands region the largest and fastest-growing gas user in Canada, with current consumption of about 2 Bcf/d rated as liable to approach 5 Bcf/d if output reaches full potential.

The Fraser study foresees only minor emissions reductions from increasing the efficiency of current production practices or replacing natural gas-fired extraction with different methods. Depending on oil prices, the cap could cost up to C$250 billion (US$192 billion) in foregone production revenues over the 15-year period of 2025-2040, the report predicts.

But industry participants have been working on an array of improvements since the late 1990s, when the Canadian government foreshadowed enactment of cleanup requirements by ratifying the global Kyoto protocol on reducing greenhouse gas emissions.

The Canadian Heavy Oil Association lists 12 new techniques as advancing through research and development stages including field trials, led by at least partial replacement of gas-fired steam with solvents or light hydrocarbon vapors such as propane and butane. More exotic experiments use microwave generators and toaster-like electric heating elements for in-situ extraction.

The next proposed big oilsands in-situ production additions include the first large uses of gas-replacement innovation. Imperial Oil is seeking approval from the Alberta Energy Regulator to employ a blend of steam and solvents for a 45,000 b/d expansion of its Cold Lake site and in a new 135,000 b/d in-situ project north of Fort McMurray called Aspen. Imperial predicts the new approach will cut carbon emissions by 25%.

Colossal fuel and environmental savings are conceivable from replacing gas-burning oilsands methods, says an industry and government research partnership called joint implementation of vapor extraction (JIVE). The team predicts that using light hydrocarbon injections instead of steam to produce one billion bbl of bitumen reserves would cut gas consumption by 1.65 Tcf, save 400 million barrels of fresh water, and avoid 85 million tons of carbon emissions.