Solvent Operations: Lessons Learned

Solvent Leadership Series: Workshop 5

Vanessa White, Director - Recovery Technologies November 14, 2019 Agenda

• 9:00 am: Presentations • Alberta Innovates Welcome and Introduction – Vanessa White • Suncor Energy – Steve Forbes • Cenovus Energy – Natasha Pounder • Imperial Oil – Richard Smith • 10:45 am: Coffee Break • 11:00 am: Question Period with the Presenters • 12:00 pm: Wrap Up • 12:15 pm: Networking Lunch

2 Clean Energy

• AI Clean Energy develops and invests in strategic research and innovation programs to achieve Alberta’s goals for energy, the environment and economic prosperity. • We provide technical insights to the GOA on resource development, energy diversification, climate leadership and water/land polices. • The Clean Energy supports Emissions Reduction Alberta in technical due diligence and project management. • Clean Energy’s strength is creating the partnerships necessary to achieve the goals.

3 4 Clean Energy

5 Recovery Technologies Portfolio

6 Clean Energy Funding

• Funding ranges between $100k to $2M • Continuous Intake Process • Open Calls

• Target TRLs 3-7

Clean Energy Website: https://albertainnovates.ca/focus-areas/clean-energy/ 7 In Situ Solvent Operational Experience

Alberta Innovates Workshop November 14, 2019 Agenda

• Injected Hydrocarbon Technologies • Safety • Operations • Regulatory, Reporting , & Monitoring

“We are advancing a portfolio of in situ technologies with the potential to lower the carbon intensity of producing bitumen.” -Suncor’s Report on Sustainability, 2019

2 Injected Hydrocarbon Technologies

Steam Enhancements Solvent+ • Approx. 15%+ GHG reduction • Approx. 50-70% GHG reduction • 20+ years of industry experiments • NCG Injection • In Situ Demonstration Facility (ISDF) • ES SAGD Pilot – Optimize and test Solvent+ technology – 12 month demonstration – Recently kicked off FEED – 10-15% solvent injection into steam – Regulatory approvals at MacKay River – Solvent injection April 2019 on 4 Well Pairs – Open to participation from other operators – Investigating commercial deployment SAGD

ES SAGD

Solvent +

3 Safety Above All Else

• Fire and Explosion – Area Classifications – Auto Ignition • EHT sheath temperatures • Steam line temperatures – High risk release scenarios

• Situational Awareness – Steam System Contamination • Utility steam • Fugitive emissions – Lockouts / maintenance

4 Operational Challenges

• Sub surface – Forecasting rates → surface design

– Downhole chemistry → H2S, TDS, Solids…

• Surface – Solvent in produced vapour condensing with water -> impact on CPF – Commodity imbalance SAGD → ES- SAGD – Inlet separation density control – High temperature separators

• Logistics – Supply – Recovery / migration – Cost (demand)

5 Regulatory, Reporting, & Monitoring

• Regulatory / Reporting – Collaboration with AER (frequency etc.) – Royalty sampling

• Monitoring – Solvent accounting vs. Ops cost – Lab requirements vs. 3rd Party – Staffing – Retrofitting

• Technology – No accurate online analyzer to measure solvent in annulus gas (vapour or liquid) and emulsion

6 Additional Information

Suncor’s Report on Sustainability • https://sustainability.suncor.com/en/innovation

Chat with us! We’re here to build and contribute to an industry network

7 Disclaimer

• Suncor Energy Inc. and its affiliates (collectively "Suncor") do not make any express or implied representations or warranties as to the accuracy, timeliness or completeness of the statements, information, data and content contained in this presentation and any materials or information (written or otherwise) provided in conjunction with this presentation (collectively, the "Information"). The Information has been prepared solely for informational purposes only and should not be relied upon. Suncor is not responsible for and is hereby released from any liabilities whatsoever for any errors or omissions in the Information and/or arising out of a person’s use of, or reliance on, the Information.

8 Natasha Pounder Sr. Process Engineer

November 14th, 2019

Process Design and Safety Improvements Required for Solvent Operations Solvent Pilots at Cenovus Energy Overview of Foster Creek Current Pilots at Foster Creek

W06 Pad • One well: W06P08 • Solvent Driven Process (50-95% Solvent)

N Pad • Two Wells: NP06 and NP07 • Solvent-Aided Process (3-10% Solvent) Solvent Skid Overview Unloading Skid Injection Skid

6 Safety Issues Experienced

Solvent Contamination - PSV Freezing

Solvent Injection Skid Fire

Date here 7 Solvent Contamination Issues

Date here 8 PSV Overview

Thermal Expansion and Blocked Flow Case PSVs on Solvent Unloading and Injection Skids PSV Freezing Issues

PSVs discharge to the Solvent Bullet, variable back pressure • Farris 3800 pilot operated PSVs selected • Equipped with reverse backflow preventer

December 2017 – January 2018: • Exhaust on PSV pilot venting solvent • PSV main body then: • wept solvent to bullet, and; • Failed to open at set pressure

Date here 10 Other Freezing Issues

Differential Pressure Level Sensor on Solvent Bullet • False High level reading from water contamination (filling dead leg above lower PIT) • Required routine draining of dead-leg SAFETY RISK: DRAIN VALVES CAN FREEZE OPEN! Drain was rod-able and steamer truck on standby

Flowmeters, PITs and TITs freezing, causing false trips

Date here 11 Why did the PSVs Freeze Open?

Joule-Thomson effect while venting out exhaust

Filled plastic jar with solvent, wait for evaporation • Water remaining in jar!

o Potential Sources: <-50 C • PSVs were pop-tested on water (vendor could not empty dome space of all water) • Equipment Commissioning • Solvent Supply: • Trucks (cleaning of trucks; previous fluids hauled) • Loading Storage (stored in salt caverns; water used to push solvent out of cavern)

Date here 12 Troubleshooting

PSVs were pop-tested on water Not likely.. Other equipment freezing too… • Have to service PSVs once venting or frozen conditions discovered • Frozen and Venting – required to be serviced • Non-Venting could be frozen shut (no way to confirm) – proactively removed for service • PSVs were pop-tested on glycol only; procedure updated

Equipment Commissioning Not likely.. Level sensor was working previously… • System in operation for >2 months; any water contamination should be clear • All dead legs and low point drains were drained of potential water SAME SAFETY RISK: DRAIN VALVES CAN FREEZE OPEN! Drains were rod-able and steamer truck on standby

Date here 13 Troubleshooting

Solvent Supply: Vendor was confident it wasn’t them (No other customer has these issues)

Freeze Valve Test Kit used to trace source! • Confirmed solvent failed freeze valve test from injection point back to truck connection

Vendor obtained Valve Freeze Test Kit - Tested tanker loading and unloading • Every test passed on filling tankers • Tests failed on unloading tankers!

Tankers were hauling Condensates and other water-containing fluids

Date here 14 Corrective Actions

1. External Heaters on PSVs First winter, to get up and running 2. Ongoing Freeze Valve Testing; reject tankers that fail; new dry tanker in 24 hours 3. Condition in contract: Dedicated solvent trucks 4. Add heat trace to critical valves (ESDVs) and PSV inlet/outlet with temp indication lights 5. Switch to non-dP based level indication (i.e. Magnetic, Guided Wave Radar) 6. Update Technical Specifications to include above considerations

Date here 15 Solvent Injection Skid Fire

Date here 16 Solvent Injection Skid Fire

Solvent Injection Skid Overview

Sequence of Events

Risk Assessment

Root Cause Investigation

Corrective Action Next Steps Sequence of Events Timeline of July 20th, 2018

18 July 20th, 2018 ~ 21:45

LIGHTNING STRIKE! What Happened Next… • Several Pads tripped • Field Run Op job to check out pads prior to re-start • Drives past W06 Pad • Observes a flame • Notifies Panel Op • Panel Op Triggers ERP • Ops meet Emergency Responders • ERs evaluate area, give “all clear” • Investigating Ops enter area

20 …and then… • Investigating Ops trace vent line to source • Op Close the 3x ¼ needle valves on vents Safe Location! • FIRE IS EXTINGHUISHED at ~22:20

21 Safety First! • Immediate Actions Taken: • Shut down N Pad Solvent Injection Skid • Keep W06 Pad Solvent Injection Skid shut down

Operations requests formal Risk Assessment prior to restart

Incident reported through internal Incident Management System (IMS) initiated • assigned incident low impact rating for both actual and potential risk

22 Risk Assessment

23 Team Composition

Risk Assessment scheduled, with a broad scope of participants: • Major Projects Process Engineer (designed the skid) • RFO Team Leads (commissioned the skid) • Site Operations (first responders of incident) • Site Facilities Engineer (involved in response to incident) • TD Operations and Facilities Engineer (operate the skid on a daily basis)

Source of ignition was unable to determined. Conducted risk assessment under assumption that one exists – regardless of how or why.

Three Impact Categories addressed: Health and Safety, Environment & Regulatory and Productive Assets. Risk Assessment Findings

First Responders provided sequence of events and showed which vent was on fire

Reviewed P&IDs • Packing Vent under constant pressure • No way for air ingress • Only act as a pilot light (no explosion) • Potential low impact assumption plausible

But wait....

Three vent lines, not two?

25 Where does the third vent come from?

Trace the line back…. The OIL SUMP VENT!

26 Sump Vent History

Lube Oil Drainage Sump vent to atmosphere

Originally designed with candy-cane vent

Vent pooled flammable vapours at ground level

Re-tubed to “Safe Location”: • Sufficient height for proper dispersion • Away from potential ignition sources, such as: • Static from workers, tools, kicked rocks….

27 Risk Caused by Sump Vent

Sump is at atmospheric pressure

Cycling in/out flow from vent during: • Sump manual draining • Heating/Cooling with ambient temperatures

Plausible for explosive environment to exist inside the collection tank!

….venting beside a “pilot light”...

Back to the risk assessment and the potential low impact rating….

28 Risk Assessment – Abnormal Ops Risk

High

Medium

Low

29 How to get back up and running?

Risk is known. Assumed that a source existed, but what are the potential ignition sources: Static discharge • Lightning strike in proximity of pad • ~1 foot section of vent lines not properly bonded to structure

Risk Assessment Immediate & Temporary Actions: • Evacuate Solvent skid when Storm Warning in effect • Signage on skid to indicate this • Directive in eLog to communicate • Replace plastic support for vent lines with a metal support

30 IMS – Root Cause Investigation

31 Causal Mapping

Traditional Five-Why format, start at the end of the story and work your way back.

All Four Goals are impacted by an Explosion

Only the Safety Goal has the People in the Area risk

Need to keep asking why: • Why was there potential for an explosion? • Why are people in the area?

32 Potential for Explosion

Before there is an explosion there is: • Explosive Mixture (Fuel Source + Air Source) • Ignition Source • Proximity between Explosive Mixture and Ignition Source

From Risk Assessment and Investigation, found three different potential root causes • Solvent venting from packing EM • Solvent venting from lube oil sump EM • Not properly bonded structure IS

Evaluated, but not considered root causes: • Lightning strike, static discharge IS • Sump vent beside packing vents P

33 People In the Area

Review of Timeline showed there were 7 Emergency Responders and 6 operators • Might be a high impact during operations, but this incident an extreme impact potential! • Why were so many people required? • No formal procedure for operator response to a Fire (only to H2S/LEL)

34 Prevention of Repetition is Key!

How to prevent re-occurrence?

1) Keep the Solvent in the Process a) Don’t let the packing vent • Vendor and manufacturer recommendations of light-end hydrocarbon pump solutions b) Don’t let Solvent leak into the oil • Solution to the a) solves b) 2) Ensure 1) solutions are included in Design Specs 3) Properly Bonded Skid • Already resolved due to Risk Assessment 4) Keep People Out of the Line-of-Fire • Update Ops Procedure for H2S/LEL response to include Fire Response • 1 person in, 1 person on standby and 1 on man-watch

35 Measuring produced solvent at a commercial thermal solvent project

SLS Solvent Group

Richard Smith

November 14, 2019 Outline

MahNo • IOL solvent process LASER experience • pilot vs commercial process

• Solvent measurement methods and scope

• Experiences and challenges with solvent measurement

• Update on Mahihkan North (MahNo) LASER project

LASER - Liquid Addition to Steam for Enhanced Recovery

2 IOL Experience with Thermal Solvent Processes

Pilots: • LASER: 8 wells • SA-SAGD: 2 well pairs • Solvent Assisted-SAGD • Both processes use diluent as solvent

Commercial LASER Projects: • First commercial trial 2007-2015: • 10 pads • 240 wells (deviated only) • ~960 acres

• MahNo 2017 start-up: • 9 pads SA-SAGD Pilot • 210 wells (deviated and horizontal) LASER Pilot • ~4650 acres LASER Commercial

3 Solvent Measurement: Pilot vs Commercial

• Pilots • Typically greenfield – fit for purpose design for solvent separation and sampling • Redundancy for flow rate and sampling • Dedicated pilot team with high ratio of oversight (Ops & Eng.) to well count • High sampling frequency

• LASER Commercial Process • Brownfield application • Fit solvent measurement systems into existing facilities • High well count • compromise on sample frequency • scope makes surveillance oversight more challenging • Solvent injection optimization • Automated solvent accounting algorithms • Database surveillance tool to aid QA/QC and stewardship process

4 SA-SAGD Pilot Solvent Process Flow

• 2 Well Pairs • Diluent is used as solvent • Diluent is trucked to the pad and metered, as-delivered, into the onsite storage tank • Total mass flow of diluent is metered, while in the liquid phase, after the injection pump • Heated and flashed diluent injected is metered separately for the toe and heel injection strings • Diluent produced up the tubing is sampled and metered at each stream of the 3-phase test separator • Diluent vented up the annulus is sampled and measured at the vent gas separator

5 MahNo LASER Solvent Injection

• For the LASER pilot and 1st commercial trial diluent was piped directly to each pad • At MahNo, diluent is injected into the steam trunkline at the Diluent Injection Station (DIS) • Injected diluent is metered at the DIS • Individual well injection rate calculations adjusted for multi component flow (steam and diluent) and prorated back to DIS volume

6 LASER Diluent Measurement: Pad Level

• 3 sample locations: 1) Production groupline 2) Vent gas 3) Vented liquid

• Lab Analysis

1) Groupline: GC C30+ and density

2) Vent Gas: GC C7+

3) Vented liquid: GC C30+ and density

• Periodic samples • Weekly transitioned to bi-weekly

• Full set of samples is 27: • 9 pads with 3 samples each

7 LASER Diluent Measurement: Groupline

• Group line C30+ Method • Diluent mass fraction derived from the L+M fraction accounting for bitumen overlap • Density correction applied • Fractionated diluent density model used to convert to volume fraction

L M H L or M

8 LASER Diluent Measurement: Vent Gas

• C4-C6 components above CSS baseline counted as diluent

9 LASER Diluent Measurement: Vent Liquids

• Diluent mass flow rate determined from Coriolis meter and the lab measured dilbit hydrocarbon density using a two phase density model (water & diluent) • C30+ GC used to correct for overlap with bitumen • Fractionated diluent density model calibrated to the lab density measure is used to convert to volumetric rate

* mH = Mt (1/rmix – 1/rw) / (1/rH – 1/rw)

10 Transition from CSS to LASER

• As pads transition from CSS to LASER, we see evidence of the solvent being reproduced

• Groupline samples show that the produced fluids contain more light ends

11 Transition from CSS to LASER

• Vented gases have an increase in C4, C5, C6

• Vented liquid hydrocarbons have more light and medium fraction components

12 Solvent Production Surveillance

• Large amount of sample and process data requires automation to maintain • Sample analysis automated load into database by production accounting • Solvent volume algorithms for each stream run automatically • Tableau dashboard allows easy review of raw sample data and calculated volumes • Dedicated team doing weekly optimization and monthly QC reviews

13 Sources of Uncertainty in Solvent Measurement

Sampling • Sampling frequency / missed samples / poor samples • Evidence of phase separation in groupline • Inherent GC analysis error

Flow Rates • Production testing uncertainty proportionally impacts groupline diluent volume • Vent gas and vented condensate rate measurements

Algorithms • Uncertainty in assumptions and correlations

Operational Challenges • Baseline light ends produced • Well venting practices can impact diluent distribution within facilities • Vented liquid separator level control

14 MahNo Baseline CSS pad Groupline Diluent

• Baseline CSS light ends in produced fluids are higher early in the cycle than the LASER pilot control pad • MahNo pads operated at higher P & T than the pilot • expect more steam stripping of native diluent from the bitumen • Baseline profile is removed from measured diluent at LASER pads

15 Groupline Samples - Plugging

• Some issues with getting good samples from the groupline • Sampling apparatus tubing can plug resulting in low sample volumes • Tends to result in high light ends in the sample compositional analysis – overestimates produced solvent volume • Theory that pressure drop through partially plugged lines is resulting in flashing of light ends into sample cylinder • Fixed by increasing the size of the tubing to ¾ “

Fraction of lighter ends increase when low sample volumes collected

16 Sample Frequency

• Started with weekly samples to capture variability in solvent production • Switched to bi-weekly in early 2019 • Demonstrated limited change in cumulative diluent volumes • Range from -10% to +3% with all three streams accounted for

Example of Weekly to Bi-Weekly Sampling Impact – Groupline Only

17 Produced Diluent Volumes – Inherent Noise

• Pad level calculated produced solvent rates tend to be noisy • Source of noise includes calculated solvent mass fraction and process rate fluctuations

• The average relative noise is +- 10%with a Std Dev of 20.1% • Based on a 9 day central point running short term average (STA)

18 Groupline Samples – Phase Separation

• There is evidence of phase separation in the groupline • Samples taken from the top of the pipe tend to be lighter • Tested impact with 7 sets of 3 point samples (top, mid, bottom of pipe) from different pads • Calculated diluent volumes using geometric average suggest mid sample point underestimates diluent volume by 7-12%

Sample compositions showing phase separation

19 Liquid Condensate Leg – Gas Interference

• Some issues with level control in the liquid trap separator observed when liquid density drops below ~700 kg/m3 • Two-phase (water-diluent) density model breaks down when gas interferes • Results in over prediction of diluent in liquid leg • Modification of level control limits improves performance • Surveillance important to identify and correct diluent volumes

20 Mahihkan North LASER – Diluent Injection • Cycle 1 injection started May 15 2017 • Diluent injection complete at 7 out of 9 pads • Target diluent ratio (vol dil/vol stm) met or Diluent Ratio exceeded on most pads Producer Only • Last two pads have CSS control wells Injected Diluent Ratio by Pad: Target Actuals Pad (%v/v) (%v/v) H51 5.0 5.7 H57 5.0 5.0 H58 3.0 3.8 H59 5.0 3.5 H62 5.0 4.8 H65 - 2.3 H68 5.0 4.0 H69 3.0 3.8 Cumulative Injection: Fluid Volume (1000 m3) Steam ~9000 21 Diluent ~350 Mahihkan North LASER – Production

• Early performance is in line with current expectations Cumulative Production: • More time is needed to fully assess Fluid Volume (1000 m3) LASER uplift Hydrocarbon 969 Diluent 84

22 Summary

• Solvent production measurement is challenging with various sources of uncertainty

• In a large scale commercial solvent project it is necessary to have a dedicated team using automated algorithms and surveillance tools and regular data QC to increase confidence in solvent production measurement

23 Coffee Break Solvent Leadership Series: Workshop 5 Solvent Operations – Lessons Learned Question Period Solvent Leadership Series: Workshop 5 Solvent Operations – Lessons Learned

Steve Forbes, Suncor Natasha Pounder, Cenovus Richard Smith, Imperial Wrap Up and Networking Lunch Solvent Leadership Series: Workshop 5 Solvent Operations – Lessons Learned Contact Us

DICE Website: https://albertainnovates.ca/programs/digital-innovation-in-clean-energy-dice/

Clean Energy Website: https://albertainnovates.ca/focus-areas/clean-energy/ 14