NW Redwater Partnership warns Sturgeon won't be processing bitumen until late-2019

NW Redwater Partnership warns Sturgeon won't be processing bitumen until late-2019

Operators of the Sturgeon Refinery warned last week that the facility won't likely reach full commercial operation until the end of this year.

North West Redwater Partnership says the refinery is still not able to process bitumen due to problems with the gasifier. 

Gasifier Unit (image courtesy North West Redwater Partnership)

The gasifier unit is designed to produce hydrogen through partial oxidation of asphaltenes. Hydrogen is a key input for the residue hydrocracker, which cracks the heavier hydrocarbons into lighter components.

Gasifiers reduce reliance on natural gas and also produce pure carbon dioxide, used primarily for Enhanced Oil Recovery in neighbouring oil fields.

Last November, the company warned that the commissioning of its gasifier was "more complex" than expected. The unit's reactor burners experienced abnormal wear, and stress cracks were observed in some of the stainless steel piping and welds.

The company says the reactor burners have been redesigned, and are now ready to be installed. The damaged piping will also need to be repaired. The plant has been producing diesel from light, sweet synthetic crude for over a year, but the switch to processing heavy, sour diluted bitumen has been delayed to the end of 2019.

Sturgeon is designed to process 50,000 bbl/day of bitumen, suppled in the form of 79,000 bbl/day of diluted bitumen. The diluent (naphtha) is stripped-off and returned to oil sands producers. The bitumen fraction is converted into 40,250 bbl/day of diesel, 8,790 bbl/day of vacuum gas oil and 3,360 bbl/day of butane and propane. 

A traditional bitumen upgrader would blend these components into a synthetic crude product, for further processing in a downstream refinery. However, the Redwater Refinery sells the individual streams to the open market. Low-sulphur vacuum gas oil, comparable in quality to sweet crude, is used as refinery feedstock. Diesel is sold to retail gas stations.

The Sturgeon Refinery is a 50/50 joint-venture between North West Refining and Canadian Natural Resources (CNRL). CNRL has agreed to supply 37,500 bbl/day of its own feedstock, mostly from the Cold Lake area. The balance will be supplied by the province of Alberta through its bitumen royalty-in-kind program (BRIK).

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