The Innovation: Making oil into marine fuel in landlocked Alberta
The Innovator: Neil Camarta
The flat, dry Alberta landscape is the last place you would expect to find a technology that turns heavy oil into marine fuel. But Field Upgrading is doing exactly that with its pilot project based in Fort Saskatchewan, located just north of Edmonton—and 800 kilometers from the nearest coastline. It’s an idea that is often met with raised eyebrows. “People don’t immediately understand the connection to ships,” says Neil Camarta, the CEO of Calgary-based Field Upgrading. And yet, despite how unlikely it might sound, he has a plan to ship 10,000 barrels per day (b/d) of marine fuel to the market by 2019.
Camarta believes he can achieve this goal in part because of the mobility of his technology. The upgrading facility will be skid-mounted, allowing the company to position it in ports all across the world. The project is a homegrown operation for now, but Camarta says it could theoretically be built near a refinery in any country, and he’s eyeing the world’s major marine fuel hubs of Singapore, Rotterdam and Fujairah as potential locations. The company is also considering Alberta’s Industrial Heartland, just north of Edmonton, as a jumping-off point. From Alberta, heavy oil would be upgraded into marine fuel and then shipped to ports in Vancouver, Seattle or Los Angeles by rail.
Camarta’s model is different from other upgrading technologies in that it doesn’t focus on getting bitumen into pipelines—indeed, Camarta doesn’t want the fuel he produces to ever see the inside of a pipeline, as the journey would contaminate the product with sulfur. Instead, once the pilot plant is complete, Field Upgrading’s end-product will be sent directly to seaport fueling stations instead of to a refinery. As an added bonus, refineries’ heavy ends could even one day provide some of the feedstock for the process.
Bitumen comes into Camarta’s pilot plant with a gravity of eight API and leaves at 18 API, with nearly all metals and sulfur removed. On a basic level, the technology works by replacing heavy sulfur atoms with lighter hydrogen atoms, which in turn raises the API. Field Upgrading is now raising money through private investors to design a full-scale facility.
Camarta says the process involves “taking the dirty out of dirty oil” by lowering the sulfur content from five percent to 0.1 percent. That should give Camarta’s technology a boost considering recent pushes to make marine fuel less sulfur intensive. In 2015, the International Maritime Organization (IMO) reduced the maximum permitted sulfur content for marine fuels from one percent to 0.1 percent, and tightened specifications for vessels in ports and close to coastlines. Farther out to sea, the sulfur content limit is 3.5 percent, but that is expected to be reduced to 0.5 percent by 2020. To meet the new specification, the only thing most ships can burn instead is marine diesel, which is more environmentally friendly than lower-cost marine fuel.
Camarta says the shift toward marine diesel could provide a decent margin, as shippers currently pay high prices for the relatively cleaner product. It will be some time yet before Field Upgrading’s pilot project is scaled up—he’s eyeing front-end engineering by 2017 for a 2019 startup. Nonetheless, it seems like the next big step in marine fuel innovation could come from an unlikely development in the Canadian prairies.