Innovation, Collaboration Key for Oil Sands Challenges

Collaboration and innovation in technological innovation and investment also is critical in progressing oil sands' development, according to a Deloitte report, "The innovation imperative: A roadmap for oil sands advancement".

Like the United States, Canada also does not have a national energy policy. Debate is underway over what would be contained in a national energy policy for Canada. "Having a national energy policy is a concept that has merit, but a lot of details need to be worked out," said Geoff Hill, a partner in Deloitte's Calgary office and national sector leader in a recent interview with Rigzone.

Despite the lack of national energy policy, progress is being made of addressing immigration policies to mitigate labor issues, technological innovation and investment and streamlining and expediting application and project reviews, according to the Deloitte report.

Three key areas where concentrated focus on innovation will be crucial to developing resources responsibly and sustainably -- while also developing technical expertise and the human capital required to teach longer-term strategic destination – include:

• internalizing water in terms of its use in hydrocarbon exploitation and elsewhere
• enhancing productivity
• optimizing technology

Oil and gas activity uses the least amount of water and recirculates more of what it uses than all other sectors of Canada, ongoing efforts and advances to reduce, re-use and recycle water used in raw material and manufacturing processes have only underscored the important to industry of water usage and management, Deloitte said.

"Ongoing collaboration within industry and between industry and universities along with key research funding in the area of water innovation and management is crucial to maintaining a sustainable and high-quality water supply," Deloitte noted.

While Deloitte recommends that oil sands producers' collaborate with universities and research-based institutions to seek new, innovative technologies to enhance production, opportunities exist for the oil and gas industry to collaborate with other industries, Hill commented.

"Looking at the complexity of the oil sands, there really isn't a sector that it doesn't touch, from telecommunications to engineering to automation," said Hill, adding the Deloitte very strongly recommends partnerships between suppliers and parallel industries for collaboration.
The recent opening of a GE Innovation Center in Calgary is an example of an opportunity for collaboration with other industries.

However, Deloitte believes that recent changes to the federal science research and experiment and development program – with a shift from funding weighted towards tax-based funding towards grant funding – are a step in the wrong direction.

"As we've seen, funding specific technologies over others does not always work," Hill noted.

Industry and stakeholders will need to press the federal government for further review of its innovation and research and development policies in the short-term, while increasing collaboration and communication among universities, businesses, and government in the long-term, Deloitte said in the report.

The treatment of tailings in oil sands remains a substantial challenge for the oil sands industry, and while significant improvements have been made, Hill said.

A number of oil sands companies are investing heavily in ways to treat tailings, and chemical treatments have shown a lot of promise.

Other emerging technologies for tailings treatment include carbon dioxide injection, waterless or near waterless processes for in situ production, collaborative water management,

The formation of industry associations such as Canada's Oil Sands Innovation Alliance (COSIA) also is a step in the right direction in terms of collaboration.

"I don't think that the formation of similar associations matters as much as the commitment and behavior of large multi-national companies agreeing to collaborate on proprietary technology," Hill told Rigzone.

Click on the following link to read about 'Labor Supply Poses Challenge for Canada's Oil Sands'

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

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