Integration of Nuclear Energy Into Oil Sands Projects

Energy security and greenhouse gas reduction are thought to be two of the most urgent priorities for sustaining and improving the human condition in the near future. Few places pit the two goals so directly in opposition to one another as the Alberta oil sands. Here, Canadian natural gas is burned in massive quantities to extract oil from one of North America’s largest native sources of carbon-intensive heavy oil. However, this conflict need not continue. Nonemitting nuclear energy can replace natural gas as a fuel source in an economical and more environmentally sound way. This would allow for the continued extraction of transportation fuels without greenhouse gas emissions, while freeing up the natural gas supply for hydrogen feedstock and other valuable applications. Bitumen production in Alberta expanded dramatically in the past 5 years as the price of oil rose to record levels. This paper explores the feasibility and economics of using nuclear energy to power future oil sands production and upgrading activities, and puts forth several nuclear energy application scenarios for providing steam and electricity to in situ and surface mining operations. This review includes the Enhanced CANDU 6, the Advanced CANDU Reactor, and the pebble bed modular reactor. Based on reasonable projections of available cost information, steam produced using nuclear energy is expected to be less expensive than steam produced by natural gas at current natural gas prices and at prices above $6.50/MMBtu (CAD). For electricity production, nuclear energy becomes competitive with natural gas plants at gas prices of $10–13/MMBtu (CAD). Costs of constructing nuclear plants in Alberta are affected by higher local labor costs, which this paper took into account in making these estimates. Although a more definitive analysis of construction costs and project economics will be required to confirm these findings, there appears to be sufficient merit in the potential economics to support further study.