Buoyancy of oil sands bitumen raises spill concerns

Natural Resources Minister Joe Oliver this week told a Vancouver audience that British Columbians have nothing to fear from Pacific exports of Canadian oil sands crude.

“We have taken significant measures to protect against a spill,” the minister said.

But one of the country’s top oil spill experts says exports of heavy crude pose added risks to the West Coast, since some oil sands blends are likely to sink in the case of a spill, complicating potential cleanup efforts.

Years of research make clear that some kinds of diluted bitumen will not float in an accident, says Merv Fingas, the former chief of research and development for a group at Environment Canada that specialized in oil spills. Instead, the oil-thinning diluent in the crude will evaporate. The remaining bitumen, if it is heavy enough, will drop through the water, where the highly sticky substance can adhere to rocks and other sediments, making cleanup difficult.

Determining whether spilled oil sands crude will float is a key question for those weighing shipments of oil to Pacific markets. Critics say the possibility of a product that sinks increases the environmental risks of such oil shipments, raising another obstacle for industry’s ambitions.

But Enbridge Inc., the pipeline builder seeking to build the Northern Gateway pipeline, has sought to assure the National Energy Board that the products it intends to carry west will stay on the surface, where they can be cleaned up using skimmers and other tools.

“It is an immutable fact of physics that they will float. They simply cannot sink in water,” Dr. Alan Maki, who holds a Master’s in aquatic biology and has served as a witness for Enbridge, told the NEB in February.

In an interview, Mr. Fingas said “that’s not true.” The diluent, he said, “comes off fairly rapidly, so you really have to look at the density of the base compound, the bitumen underneath it.”

Bitumen is different depending on its source, but some has a higher specific gravity than seawater, Mr. Fingas said. “So some bitumen will sink and some will not,” he said. He added: “Every time we did get a sample of any kind of bitumen in the laboratory and analyzed it, it always sank.”

Mr. Fingas holds a PhD in environmental physics, plus three Master’s and two undergraduate degrees. He has been involved with over 800 papers and publications, as well as six books on spills. He was one of three scientists chosen by the U.S. National Oceanic and Atmospheric Administration to estimate the amount of oil spilled in the Gulf of Mexico in 2010.

Mr. Fingas supports Pacific oil sands exports, saying it’s economically necessary for Canada. And bitumen, he said, has fewer soluble toxins than light oil, making it much safer to aquatic life if spilled.

But the possibility that bitumen won’t float has raised alarm in B.C. Sinking bitumen makes an already “really messy situation” in the case of a spill “orders of magnitude more difficult,” said Eric Swanson, a director for the Victoria-based Dogwood Initiative. Art Sterritt, executive-director with Vancouver-based Coastal First Nations, said heavy crude could deal a double blow in case of an accident: “It’s going to float for a while and it’s going to wipe out the foreshore, then it’s going to sink and it’s going to wipe out the bottom,” he said.

Enbridge has presented research to the NEB that tested two types of diluted bitumen. While some 15 per cent of the oil fell 10 centimetres below the surface of the test facility, “at no point was oil found to submerge, sink, and stick to the bottom of the flume,” the report found.

In a statement, Enbridge spokesman Todd Nogier said making diluted bitumen creates “a new product” that is “not likely to sink in areas away from the shoreline in marine environments.” He added that oil “may sink” near shore if it “interacts with sediments.” Enbridge has been ordered to dredge parts of the Kalamazoo River after remnants of a heavy oil spill remain in the Michigan waterway.

A 1999 study by the U.S. National Research Council found that in heavy oil spills, 20 per cent of the crude sank, compared to 4 per cent in all spills. Ottawa has pledged more study. On Monday, Natural Resources Minister Mr. Oliver said the government will examine how bitumen behaves “when spilled in the marine environment.”

Environment Canada’s studies of bitumen in spills date back to 1995, Mr. Fingas said. The current government, however, has substantially cut back that work. Mr. Fingas spent 33 years with Environment Canada before quitting in 2006, ahead of cuts that he said trimmed its environmental emergencies research work force from 45 to roughly 15, and eliminated the two aircraft it used for studies. That has hamstrung capabilities Mr. Fingas worked to build.

Chemical components and health implications of Bitumen

Chemical components and health implications of Bitumen

Bitumen is a very thick and sludgy material in its pure form. In order to increase its viscosity, solvents are added and when Bitumen and the solvents are released into the environment, they do not stay together and the volatile portions are released into the atmosphere.

While exposure to pure Bitumen can cause mild to severe skin burns depending on the concentration, it is the additives that once released cause the most significant health effects.

One of the solvents comes from the chemical family known as Naptha which includes Napthalene (coal tar). The Material Safety Data Sheet (MSDS) lists that it is toxic to blood, kidneys, the nervous system, the reproductive system, liver, mucous membranes, gastrointestinal tract, upper respiratory tract and the central nervous system Symptoms of exposure to high levels include fatigue, lack of appetite, confusion, nausea, vomiting, diarrhea, blood in urine. Some research has shown that prolonged high exposure to Napthalene may destroy red blood cells and result in hemolytic anemia.

Rats exposed repeatedly to Napthalene vapors developed abdominal and nasal cancers. Female rats were more susceptible to cancer in the bronchi and lungs.

Benzene, another solvent is known to cause cancer most commonly leukemia and other blood related cancers such as non-Hodgkin lymphoma. Inhalation of high doses of benzene may affect the central nervous system with can lead to drowsiness, dizziness, headache, tremors, confusion and/or unconsciousness. Consuming benzene can cause vomiting, stomach irritation, dizziness sleepiness convulsions and rapid heart rate. Swallowing very high levels can lead to death. Long term exposure affects the bone marrow and the production of new blood cells.

Toluene is a known human carcinogen and has a distinct odor associated with paint thinners, fingernail polish and rubber adhesives. Exposure can cause mild to moderate skin irritations and can be absorbed to some extent through the skin. Inhalation of the vapour affects the repiratory tract causing coughing, wheezing and nasal discharge. Inhalation of high levels cause central nervous system effects such as nausea, headache, dizziness, tremors, restlessness, light-headedness, memory loss, insomnia, impaired reaction time, hallucinations, ataxia and loss of motor control. It can also cause heart palpitations, increased or decreased blood pressure, respiratory depression vision disturbance and loss of appetite. Chronic exposure can lead to brain, kidney and liver failure.

Hydrogen sulphide with its distinctive smell of rotten eggs can also be a concern from Bitumen and oil wells. Just a few breaths of high levels can cause death. Short term exposures at low levels can cause coughing, changes in blood pressure, vomiting, difficulty breathing, headache, drowsiness, brain damage and nerve damage.

Each of these components has Material Safety Data Sheets which outline not only the health effects but also exposure control, storage and handling, and what measure to take in the event of an exposure. Members would be advised to participate in Emergency Preparedness committees to create plans to prevent, control and react to exposures.

BCTF, Health and Safety Committee

Alberta bitumen takes to the tracks

Pipeline bottlenecks and discounted heavy oil have producers purchasing a train ticket to move their product to market.
North American railroads carry an estimated 400,000 barrels of crude a day – equal to a new, large pipeline.In a market where heavy crude sells at a huge discount and pipeline space is at a premium, one oilsands producer has found a way around the bottleneck.Southern Pacific Resource Corp., which began trucking out initial production from its new McKay Thermal Project three weeks ago, will open a dedicated rail terminal in a few weeks just south of Fort McMurray and ship its product in leased tanker cars via CN Rail all the way to Natchez, Miss.

From there, it’s just a short barge ride down the Mississippi River to one of the eight refineries in Louisiana, where the crude will fetch $20 to $30 a barrel more than it could at the congested terminal hub in Cushing, Okla.

While Canadian and U.S. railways are scrambling to meet demand, opening small terminals close to production in locations such as the Bakken area of southern Saskatchewan and North Dakota, the Athabasca oilsands have not been part of the rush. Until now.

“I think Canadians are going to have a much more difficult time getting crude to market than we may expect and that’s because of the delays in the (Northern) Gateway and Keystone (pipelines),” said Byron Lutes, chief executive of Southern Pacific.

He said that using the CN line will demonstrate “another safe and viable alternative for transporting bitumen.”

Unlike pipelines, that means no public hearings and no environmental protests.

Railways have been carrying oil for a century and were the only way to move crude before major pipelines were developed beginning in the 1940s.

But the rail option isn’t cheap and wasn’t viable until two things changed.

First, the price spread widened after 2010 when bitumen production began to climb faster than pipelines could be built to refineries in the Midwest and Gulf of Mexico. So not only are bitumen prices in Alberta low, the prices of all crudes stored at Cushing, fell in comparison to the West Texas Intermediate (WTI) price. That gap, or differential, is now about $22, but has been much higher. Plus, heavy crude can trade higher than WTI on the U.S. Gulf Coast.

Second, the demand for diluent that must be added to bitumen to make it flow like oil through pipelines has climbed. Producers are paying more for the varsol-like diluent than they get for the bitumen – called dilbit when thinned with 30 per cent diluent.

Southern Pacific estimates it will pay $31 a barrel to move its product to a Louisiana refinery by rail and barge compared with $8 for pipeline shipping.

But once the $20 differential is added and one considers the fact that Southern Pacific needs just 20 per cent dilu-ent for rail transport – and is able to import less-expensive U.S. diluent in the empty cars on the return trip – the deal makes economic sense.

To get a clearer picture of the size of the growing rail option, consider that this year in the U.S., railroads will carry 340,000 bpd. With the estimated 60,000 bpd in Canada, that adds up to 400,000 bpd – equal to a new, large pipeline.

But not even railroaders expect the rapid growth to continue forever and the companies must weigh how much to invest in oil-hauling operations against the risk future pipelines will move that crude.

“It’s really hard to gauge the long-term prospects of demand because a lot of this is being driven by lack of pipeline capacity,” David Tyerman, a Canaccord Genuity Inc. analyst in Toronto told Bloomberg. “Even the rail industry is trying to temper its expectations because it doesn’t want to build its business plans around something and then have that not happen.”

As recently as two years ago, CN didn’t haul crude. It now projects moving 30,000 carloads in 2012. This week it announced its latest project with partner Arc Terminals LP to build an off-loading facility in Mobile, Ala., for crude destined for Gulf Coast refineries.

Canadian Pacific was moving 500 tank-car loads a year in North Dakota in 2009, but now expects an annual rate of 70,000 carloads – 46 million barrels by early 2013 throughout its system.

“Canadian Pacific believes rail and pipelines are complementary, with rail having a permanent role to play as a transportation solution for energy producers,” said spokesman Ed Greenberg, who is based at the company’s U.S. headquarters in Minneapolis.

“Rail is a flexible option for transporting crude oil, and rail is scalable, which allows CP to scale its operations” to match customer needs, he added.

The firm behind Southern Pacific’s project is Calgary-based Altex Energy, which at one time was promoting a pipeline between Alberta and Texas.

It is now building rail terminals, an idea that appeals to small firms that don’t want to sign 20-year pipeline contracts. With its new project, Southern Pacific is slowly ramping up.

McKay expects to be producing up to 12,000 barrels per day of bitumen and a 6,000 bpd expansion is being planned.

Under the contract with Altex, CN and Genesis Energy in the U.S., more than 12,000 carloads each year will be heading to Mississippi in the 500 rail cars Southern Pacific has leased.

This would equal about 10 crude unit trains per month on a two-week return trip. The CN line runs through the Edmonton region.

Initially, the bitumen will be trucked to Southern Pacific’s new terminal, but it is hoped a rail spur might eventually be built to the McKay site, which is 45 kilometres northwest of Fort McMurray.

The target for Southern Pacific and perhaps other small steam-assisted gravity drainage (SAGD) oil producers is the Gulf Coast, and in this case, the lower Mississippi, where refineries can handle two million bpd of crude – including 400,000 bpd of heavy crudes like Alberta’s bitumen.

Current heavy crude suppliers are mainly Mexico and Venezuela, but imports have been declining. As well, some refineries have not been running at capacity .

Dcooper@edmontonjournal. Com
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