Abby L. Harvey
GHG Monitor
11/20/2015
SaskPower’s Boundary Dam Unit 3 carbon capture and storage project has come under fire recently by members of the Saskatchewan provincial government, who claim that the company was not forthcoming about issues at the plant. These issues were no secret, SaskPower CEO Mike Marsh said in a telephone interview late last week, and are not uncommon in a project of this size. “I think the important point here is an understanding that a facility like this typically, I’m not going to say normally, but typically would have issues in the first year or two of operation,” Marsh said.
Boundary Dam came online in October 2014 and recently underwent an overhaul during which several technical issues were addressed. The plant has also faced criticism in the provincial government and media recently due to a $12 million (CAD) penalty that was paid to oil company Cenovus for undersupplying captured CO2 in 2014.
Marsh spoke with GHG Monitor about the recent controversy surrounding the plant and current operations as the facility fires back up.
The Boundary Dam project has come under fire recently from some members of the Saskatchewan provincial government, but it seems that a lot of concerns that are being raised are things that occurred some time ago, like the Cenovus payment, which was an issue from 2014. Why is it that all of this is coming to light now and in such a big way and what can be done to keep this sort of scandal from happening again in the future?
You’re right. Your observations are right on. Some of this information is very old information and information that was disclosed a long time ago. For us as a utility, bringing up the first full-scale CCS plant attached to a generating station, we’ve had some difficulties, but we’re very proud of what we’ve accomplished to date. I think the important point here is an understanding that a facility like this typically, I’m not going to say normally, but typically would have issues in the first year or two of operation. What we’ve said in hindsight is we probably could have done a better job as we headed into the operation of this plant to let people know that that is a more correct expectation. I think us not doing that, of course with some of the statements that got made that were perhaps a little optimistic, put the fact that we were having operational difficulties with those statements kind of at odds.
The reality is, for a facility of this size, it does take some time to bring it up. Now, we achieved overall about 40 percent of the maximum production [capture] capacity of that plant last year. We achieved that within a few weeks of operation in the fall of 2014. We did achieve up to 80 percent capture rate for periods of time. We’re going to continue to push through all the technical challenges, and we will have this plant producing more CO2 and operating at a higher capacity factor as we head into 2016. That’s the objective, and I believe we’re entirely again in line with how other major facilities — I’ve compared this to oil and gas refineries, other chemical plants, even major generating stations — have issues from time to time in their first year of operations.
We want to make sure people understand that the plant is operational. We’ve just come back from our overhaul, and the plant is producing today and will continue to produce over the next few weeks and months. Our initial schedule right now is to move into some testing regimes over the next few weeks. That means pushing the performance of this unit up to its nameplate capacity for a period of time and then bringing it back down. There’s still a large number of testing regimes we have to put the plant through over the next few months, and we intend to do that certainly in a very organized, careful way, and our engineering and technical teams are working on that.
These testing regimes, are they due to the problems that have occurred at the plant, or is this routine?
I would consider it more routine, as we replace components in the plant on overhaul, as with any major facility you have to test out the components. You have to test out the subsystems. You have to isolate certain systems from time to time, you have to make them fail and see how you can ramp the facility down and turn it off in a safe manner. You have to be able to ramp it up. There are a great number of things that operationally we have to put this plant through its paces. That is the same for any industrial facility anywhere in the world.
There has been a lot of speculation at this point as to what caused the delays that eventually led to that Cenovus penalty that in turn sparked the recent comments from the members of the provincial government. Some reports indicate it was due to issues with contractor SNC-Lavalin. Some are saying that it was the amine tank liner that was recently replaced. What happened? Who is responsible?
It’s never a cut and dry issue, and I’m going to refrain from naming any one contractor. I’m going to say that we have long said there have been construction delays which resulted in this plant not coming on until the fall of 2014, so we did have a six to nine month delay. That was signaled way back in 2014. There was no attempt to hide the fact that the plant was delayed.
The issue is that the contract that we had with the CO2 off-taker had a clause in there which linked it to an earlier start date, which meant that with the delays in construction, we could not get the plant up and running and manufacturing enough CO2 for the remainder of the year to meet a volume commitment that was in the contract. That’s been explained to the media over the last three weeks several times. It’s a contractual issue, and although some people certainly have an opinion about it, it is a contract that we entered into with Cenovus and we’re obligated to meet the terms and conditions of that contract and we’ve done so.
The intention of course is to continue to improve the capacity output of that plant to make sure that we can meet our volume commitments out of this plant now that it’s a commercially operating facility in the sense that we are selling CO2 to Cenovus, and as we ramp up production through 2016 to make sure that there is no volume shortfalls, so that’s the objective for our team.
Recently there was a lot of focus placed on the amine tank, what was the problem with the tank. Has it now been fixed and how long was the issue known about?
The amine tank had really no bearing on any of this. This is an issue that arose once we started the plant up in October [2014] and started to watch the performance of the various components in the plant. The original tank that was put in was a brick tank with a liner in it. That particular tank was leaking. There was no technical solution that could be found to prevent it from leaking, so the decision was made by SaskPower and one of the contractors to replace that tank and so it was scheduled for the overhaul. The tank was built, it was replaced on the overhaul as we do with hundreds of different pieces of components, and the tank is working well today, and it was replaced at the contractor’s cost. For us, this is normal operations maintenance and correcting issues that we find during the annual operation of facilities like this.
The mechanical vapor recompressors, which are required for the plant to reach full capture capacity, were also worked on during the overhaul. What was the problem with the recompressors? Was this an existing problem throughout the life of the plant or something that cropped up later, and has it been resolved?
There are two of those devices in this facility, one on the SO2 side and one on the CO2 side, and these devices are used to compress vapor, that’s why they call them mechanical vapor recompressors. Those two devices were not performing the way our engineering teams expected them to. There are only certain opportunities to repair them and to work on them. You can’t do that when the plant is running. So, we lived with certain limited operation until we could get into the overhaul period. Again, this is normal in a large facility. You plan for an outage, you plan for the equipment that you’re going to need to take down and repair, and you correct it on the outage and put it back into service. If you need to take another outage following that, you take another one. Those devices are both operational as far as I’m aware today, and the performance of the plant is very, very good and as I said we’re going to put the plant through its nameplate capacity tests in the next few weeks.
Are there any other existing problems that you haven’t had a chance to address that could be stopping the plant from reaching its full capture capacity?
We believe that we’ve identified all the major items that were resulting in the drop in efficiency and the resulting lost production capacity for that facility. As we identify them, we will come up with a tactical solution, and we’ll put that into place at the appropriate time. If we can do it online, of course, we will do it online. If we have to wait for another outage, or if we have to plan for an outage, then that’s what we do.
How often do these outages take place?
Typically on a large facility there’s usually an annual planned overhaul, but, of course, depending on how the plant is performing you may have to take it down for smaller overhauls throughout the year to replace certain components. Again, we’re in the first year of operation and heading into the second year, so we are getting a grasp on how many outages we’re really going to need to upgrade and replace components in this plant. As time goes on, the objective obviously is to have very good uptime, which means running hours and very stable operation, high reliability. That’s the objective.
The plant is up and running now. At what capture capacity is it running at this point and do you have any idea when you might be able to bring it up to full capture capacity?
We’re going to be putting it through its paces in the next couple of weeks, as soon as we have some news on that front we intend to let everybody know. It is running right now. We’re producing between 2,000 – 2,500 tonnes per day, but that amount is varying day to day as we put it through its paces. The maximum capacity of this plant is around 3,000 – 4,000 tonnes per day. That’s the nameplate capacity kind of test that we are going to be putting it through its paces on in the next little while.
There have been suggestions that SaskPower will delay its decision as to whether to install CCS on the other Boundary Dam units. Why the delay, and do you have any idea when that decision might be made?
That statement was made in reference to a document that was actually printed in 2012. So, if you go back in time, we fully expected to have a year of operation by this time and be in a position probably in later 2016. I’ve been saying for many months now that we need to get the plant up to full operation and full capacity and achieve stable operation so that we can really understand the technical and the economics of this facility to help us inform the next decision. Internally we’ve just made a decision that until that time comes, we’re going to just defer decision on BD 4 and 5.
We do have time here in Canada. Federal regulations require that we make a decision by 2019, so there’s nothing forcing us to a decision in 2016. It was our own internal clock that we had set for ourselves, and as time goes on we are going to do the proper assessment, collect all the operating information on this facility, because it’s the one the rest of the world is looking at, and we’ll use that information to inform the decision on 4 and 5. Right now, we’re looking at some time into 2017 the way things are looking today.
Is there anything else you’d like our readers to know?
I think my last comment would be we’re still very proud of this facility. We believe it is a first of its kind integrated facility. Our folks have been working very, very hard, and I want to acknowledge all the hardworking people in SaskPower and in our contractor and vendor communities that are continuing to work with us to make this plant a success. I also want to acknowledge the community of interest around the world around carbon capture and storage who understand the technical challenges and continue to send us good wishes as we bring this plant up to maximum capacity.
