News Release 2010-12-17

 

News Release 2010-12-17

News Release 2010-12-17 (NR2010-20)

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ERCB conditional approval of final two tailings plans ends initial phase of Directive 074

For immediate release

Calgary, Alberta (Dec 17, 2010)… The ERCB has conditionally approved the final two tailings plans submitted under Directive 074: Tailings Performance Criteria and Requirements for Oil Sands Mining Schemes.

The CNRL Horizon and Shell Jackpine plans represent the seventh and eighth tailings plans submitted to the ERCB by five oil sands operators in total. To date, the ERCB has conditionally approved tailings management plans for the Suncor Millennium/Steepbank, Suncor Fort Hills, Syncrude Mildred Lake and Aurora, Imperial Kearl and Shell Muskeg River projects.

Collectively, the five oil sands operators have committed more than $4 billion in technology, infrastructure and upgrades to meet the regulatory requirements in Directive 074. Over the life of the projects, tailings reduction at those sites will exceed Directive 074 requirements.

The ERCB has approved the CNRL tailings plan with nine conditions (see attached backgrounder). The CNRL plan includes the testing, construction and implementation of two new tailings technologies, Mature Fine Tailings Thin Lift Dewatering and Non-Segregated Tailings. From the year 2015 onwards, the ERCB has required CNRL to exceed Directive 074 annual fluid fine tailings reduction requirements in order to achieve a cumulative overall fluid fine tailings reduction that is equal to or better than Directive 074 requirements by no later than year-end 2025.

The ERCB has approved the Shell Jackpine tailings plan with six conditions (see attached backgrounder). Shell plans to meet Directive 074 fines capture requirements initially using Thickened and Centrifuged Tailings, then using Non-Segregating Tailings. From 2015 onwards, the ERCB has directed Shell to exceed Directive 074 annual fine tailings reduction requirements in order to achieve a cumulative overall fine tailings reduction that is equal to or better than Directive 074 requirements by no later than year-end 2019.

CNRL Horizon and Shell Jackpine, located 70 km north of Fort McMurray, each utilize one fluid tailings pond, which are used as reservoirs for water to be pumped back into the plants and re-used in the bitumen extraction process. Fine particles that settle to the bottom of each pond and form MFT are removed, treated and placed in dedicated disposal areas. The ponds are scheduled to be used throughout the operation of each project. CNRL Horizon’s pond is scheduled to be returned to a trafficable surface in 2050 and the Shell Jackpine pond follows in 2057.

The tailings plan approvals end an important initial phase in the implementation of Directive 074. By September 30, 2011, operators must submit annual tailings plan updates to ensure that tailings ponds are being managed in accordance with their tailings plans and that upgrades are being made on schedule. On that date, operators must also file their first compliance plans for Dedicated Disposal Areas, which are areas dedicated solely to the deposition of captured fines which can be made trafficable and ready for reclamation more quickly.

The next two tailings ponds slated to be returned to a trafficable surface are Syncrude’s Mildred Lake East In Pit, and Suncor Millennium/Steepbank’s Pond 5, which are expected to be returned to a trafficable surface by 2016 and 2017 respectively.

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For more information, please contact:

Davis Sheremata, ERCB Communications
Phone: 403-605-4216
E-mail: Davis.Sheremata@ercb.ca
Media line: 1-855-474-6356

NR2010-20

Backgrounder

Conditions on CNRL Approval

The Operator will meet or exceed 50 per cent fines capture on an annual basis in Dedicated Disposal Areas (DDAs) and an additional 40 per cent fines capture on an annual basis to reflect the absence of conventional dykes and beaches at the Horizon site by December 31, 2015.

The Operator will meet fines capture requirements in Directive 074: Tailings Performance Criteria and Requirements for Oil Sands Mining Schemes (Directive 074) on a cumulative basis no later than December 31, 2025 or other date as approved by the Board.

The Operator must operate all DDAs as described in Directive 074 , including compliance with the strength requirements annually for the year 2015 and beyond, unless otherwise approved by the Board.

By September 30, 2011 the Operator must submit a plan to the Board for approval that evaluates alternatives and proposes measures to further accelerate fluid fine tailings treatment. The submission must include the following:

  1. options for accelerating technology implementation,
  2. options for accelerating construction timelines, and
  3. any other information the Board may require.

The Operator must design, construct and operate the Non-segregated Tailings (NST) Plant or other fines capture facility with equivalent fines capture capability by December 31, 2014, unless otherwise approved by the Board. The Operator must meet the following milestones.

  1. June 30, 2011: Submit detailed NST Plant or other fines capture facility milestones for approval, including:
    1. detailed project design and construction timelines,
    2. critical path milestones and associated contingency,
    3. key planning assumptions and supporting rationale for selection of milestones,
    4. table of outstanding risks that may impact the project, and
    5. any other information that the Board may require.
  2. June 30, 2011: Construction commenced
  3. December 31, 2012: Detailed engineering complete
  4. December 31, 2014: Construction complete

The Operator must notify the ERCB of any delays to NST Plant or other fines capture facility milestones referenced in Clause 19 above in advance of any anticipated milestone delays that are expected to exceed two months in duration. The Operator must provide reasons for the anticipated delay(s) and outline the contingency plans to meet the timelines outlined in this approval.

As part of its annual Tailings Plan submissions to the Board under Directive 074, the Operator must submit annual updates for its NST Plant or other fines capture facility that include:

  1. progress reports of construction and commissioning, including actual status in relation to milestones requested in this approval,
  2. a description and chronology of all activities and operations conducted to date,
  3. an evaluation alternatives and proposal of measures to accelerate fluid fine tailings treatment,
  4. options for meeting Directive 074 following the final year of NST deposition in each location, and
  5. any other information requested by the Board.

The Operator shall submit a tailings measurement plan for approval two years prior to tailings deposition in DDAs or such other date approved by the Board.

At least six months prior to commencement of construction of those facilities, the Operator will notify the ERCB in writing of any proposed pilot plants, field pilot tests and/or demonstration plants for all tailings technology development. The Operator will also provide written updates of any previously submitted test reports no later February 28 in each year or as otherwise specified by the Board.

Conditions on Shell Jackpine Approval
  1. Unless otherwise approved in writing by the ERCB Shell must:
    1. submit a completed application for the Thickened Tailings Drying Area by February 1, 2011;
    2. complete construction and commence operation of the Thickened Tailings Drying Area by November 30, 2011; and
    3. notify the Board immediately of any schedule delays that are expected to exceed two months in duration. Shell must provide reasons for the anticipated delay(s) and outline its contingency plans to meet the timelines outlined in this approval.
  2. Unless otherwise approved in writing by the ERCB, Shell must:
    1. Meet the following milestones for the development of mature fine tailings (MFT) Centrifugation or other alternative fines treatment technology and must notify the Board immediately of any anticipated milestone delays of two months or greater:
      1. August 31, 2011: Decision on Select Phase of MFT Centrifugation or alternative fines treatment technology
      2. December 31, 2012: Begin construction of commercial MFT Centrifugation or alternative fines treatment technology
      3. July 1, 2014: Commence commercial operation of MFT Centrifugation or alternative fines treatment technology
    2. As part of its annual tailings plan submissions under Directive 074: Tailings Performance Criteria and Requirements for Oil Sands Mining Schemes (Directive 074), submit annual MFT Centrifugation or other alternative fines treatment technology updates that include:
      1. progress reports of construction and commissioning, including actual status in relation to the milestones outlined in Application No. 1625823,
      2. a description and chronology of all activities and operations conducted to date, and
      3. any other information formally requested by the Board.
  3. Unless otherwise approved in writing by the Board, Shell must achieve fines capture, as defined in Directive 074, as follows:
    1. at least 10% by December 31, 2010,
    2. at least 9% in the calendar year 2011,
    3. at least 22% in each of the calendar years 2012 and 2013,
    4. at least 43% in the calendar year 2014, and
    5. at least 50% in each calendar year commencing 2015.
  4. Unless otherwise approved in writing by the Board, Shell must exceed fines capture requirements from 2015 to 2019 to achieve a cumulative fines capture at the Jackpine Mine project that is equivalent to the requirements of Directive 074 by December 31, 2019.
  5. Unless otherwise approved in writing by the Board, Shell must submit updated measurement plans to the Board for approval by February 7, 2011.
  6. At least six months prior to commencement of construction, Shell will notify the ERCB in writing of any proposed pilot plants, field pilot tests and/or demonstration plants for all tailings technology development. Shell will also provide written updates of any previously submitted test reports no later February 28 in each year or as otherwise specified by the ERCB.
Tailings Ponds

CNRL Horizon and Shell Jackpine each utilize one fluid tailings pond, which are used mainly as reservoirs for water to be pumped back into the plants and re-used in the bitumen extraction process. Fine particles that settle to the bottom of each pond are dredged on a regular basis and placed in dedicated disposal areas for quicker drying. The ponds are scheduled to be used throughout the operation of each project. CNRL Horizon’s pond is scheduled to be returned to a trafficable surface in 2050 and the Shell Jackpine pond follows in 2057.

The Imperial Kearl project, slated to begin operating in 2012, involves one tailings pond, which will be decommissioned by 2038. The Shell Muskeg River project involves five fluid tailings ponds, which are scheduled to be decommissioned in 2015, 2018, 2019, 2038, and 2049.

Suncor Fort Hills plans to operate one tailings pond which will operate for approximately 22 years with a plan to dry tailings to a trafficable surface in compliance with Directive 074.

Suncor Millennium/Steepbank currently utilizes four tailings ponds which are scheduled to be decommissioned in 2017, 2029, 2032, and 2035.

Syncrude’s Mildred Lake site currently deposits tailings in five tailings areas which are scheduled to be returned to a trafficable surface in 2016, 2020 and 2023, with the Mildred Lake Settling Basin scheduled for return to a trafficable surface in 2060.

Syncrude’s Aurora North site currently operates a single tailings pond which is scheduled to be returned to a trafficable surface in 2037.

Directive 074: Tailings Performance Criteria and Requirements for Oil Sands Mining Schemes
  • Directive 074 requires operators to:
    • Prepare tailings plans and report on tailings ponds annually,
    • Reduce the accumulation of tailings by capturing fine particles, that would otherwise remain suspended in tailings ponds ,and placing them in a deposit that can be walked on and,
    • Specify dates for construction, use and closure of tailings ponds and file these dates with the ERCB by September 30, 2009.
  • The submission of the tailings plan is an annual requirement of Directive 074, which will allow the ERCB to continuously monitor tailings operations and provide a means to take enforcement action when necessary. Compliance with the two main Directive 074 criteria (fines capture and DDA strength) is to be measured by companies annually starting in 2011. Additional reporting is required on the fluid tailings content of each pond annually and is scheduled to be submitted along with the annual tailings plan to the ERCB by September 30 of each year.
  • The ERCB has provided limited flexibility to oil sands operators to design and construct necessary industrial facilities (some costing hundreds of millions of dollars) which take into account each project’s specific geological and technical requirements in order for them to comply with Directive 074 requirements.
  • All of the plans are available on the ERCB website at www.ercb.ca
General Information
  • “Tailings” is a term used to describe waste from oilsands extraction processes. This waste is generally composed of water, sands, silt, clay and residual bitumen.
  • Tailings are discharged into large tailings ponds. The larger sand particles in the tailings settle to form a stable deposit very quickly, while the finer clay particles take years to settle and are known as fluid fine tailings. Research on ways to treat fluid fine tailings continues, with the goal of developing technology that will help the fine clays settle quicker or eliminate the need for storage ponds altogether.
  • In past applications, mineable oils sands operators proposed the conversion of fluid tailings into deposits that could be walked on and ready for reclamation. While operators have applied technologies to try and make this happen, they have not met the targets set out in their applications.
  • Alberta’s inventory of fluid fine tailings that require long term containment is now 840 million cubic metres. The ERCB estimates tailings ponds today are approximately 170 sq km.