Standards Workshop Calgary, Alberta June 6, 2013

GLOBAL CCS INSTITUTE

Agenda

Opening Remarks: Victor Der - Global CCS Institute

Session 1: CSA Z741 Geological Storage of CO2 Jeff Walker - CSA Group

Session 2: Impact of Z741 on Public Engagement and Safety Jacqueline Sharp - Navius Research

Session 3: Impact of Z741 0n Project Costs Allan Greeves - Cenovus

Session 4: Impact of Z741 on Mitigating Projects Risks Rob Bioletti - Alberta Energy

Session 5: Facilitated Discussion Bob Page – University of Calgary, J-P Jepp – Shell Oil Company, Rob Craig – ICO2N and participants

Closing Remarks: Victor Der - Global CCS Institute

Process

Speakers will give a 20 minute presentation. The balance of the time is for Q&A and discussion

There will be an extended open discussion at the end of the day

Vic Der will be the principal facilitator

Ian Hayhow will be the rapporteur

Chatham House rules apply

We likely can be a bit flexible with the timelines

Workshop Objectives

The expected outcome for today is:

Identify the advantages and challenges to using standards for CO2 storage projects

Storage Issues:

• How rigorous is the pre-screening process?

• Should there be a mechanism to recover pre-screening costs?

• Who can/will do expert reviews?

Next Steps

• Draft summary report to be prepared by the Global CCS Institute

• Circulate to participants for comment

• Publish on the Institute website

• Comments of the workshop please

• Thoughts for other workshop sessions

CSA Z741 Geological Storage of Carbon Dioxide

Jeff Walker GCCSI - The Role of Storage Standards in the Deployment of CCS Workshop June 6, 2013

Agenda

• About CSA Group • About consensus standards • Role of standards in CCS • CSA Z741 Geological Storage of CO2 • Update on ISO standards

7

CSA Group

• Independent not-for profit Standards Development, Product Certification and Consumer Product Evaluation Organization

• Largest and most diversified Standards Development Organization in Canada

• Neutral 3rd party

• One billion products worldwide bear a CSA product safety mark

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Standards Development

9

3,000 Standards and Codes

8,500 expert Committee Members

54 Program areas

40% of standards are referenced in government regulation

95% of customers recommend the use of CSA standards

Standards

What is a consensus standard? A document designed to be used as a rule, guideline

or definition. It is a consensus-built, repeatable way of doing something

Standards must fit the need • Prescriptive based • Objectives based • Performance based • Principles based • Hybrids

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Consensus

Consensus General agreement, characterized by the absence of

sustained opposition to substantial issues by any important part of the concerned interests and by a process that involves seeking to take into account the views of all parties concerned and to address any conflicting arguments.

Consensus is not necessarily unanimity CSA uses an accredited standards development

process to develop standards through consensus

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CSA’s Consensus Process

CSA does not write standards Technical Committees write standards CSA does not influence the technical content

12

• Organized to drive diverse stakeholders to consensus on tough issues

• Accredited by the Standards Council of Canada • Technical Committee - Balanced Matrix

– All interest groups have equal access – Minority interest groups have a voice

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CSA’s Consensus Process

Chair

Associate Members

5 Year Reviews

Public Review

• Owners / Architects/ Regulators

• Suppliers/ Fabricators/ Contractors

• Consultants

Committee • Owners • Researchers • Regulators • Suppliers • Fabricators • Contractors • Consultants

Role of Standards Standards and Public Perception of CCS • People are worried about geological storage • Public opposition has caused cancelation of several

CCS projects • Standards can provide assurances that CCS is safe

14

Role of Standards Standards and Regulations • Standards and regulations can work together • Standards are voluntary • Typically standards initiated by industry • Demonstrate regulatory compliance

15

Role of Standards Standards and Regulations • Streamline the regulatory process • Harmonize across jurisdictions • Standards have a revision process

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Role of Standards Other Benefits • Transfer of knowledge and experience • Mainstream leading practices • Financing CCS projects • Acceptance by different interests

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CSA Z741

CSA Z741 Geological Storage of CO2 • Bi-national USA – Canada • IPAC CO2 provided support • Publication in 2012 • CSA Z741 is not a “cookbook” Promote environmentally safe and long-term

containment of carbon dioxide

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CSA Z741

Scope • Establishes requirements for the storage of CO2

• Recognizes projects are site specific • Primarily applicable to saline aquifers and depleted

hydrocarbon reservoirs • Does not preclude its application to EOR storage

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CSA Z741

Scope • CO2 storage during EOR is different • Aspects can be used for EOR projects • When storage is an incident of routine EOR

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CSA Committee

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User Interest Category Min Max Actual

General Interest 8 11 10

Government and/or Regulatory Authority 5 7 6

Owner/Operator/Producer 7 9 7

Supplier/Contractor/Consultant Interest 6 9 6

Balanced Matrix Approach to Consensus

Committee Organizations

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Government/Regulators – Energy Resources Conservation

Board of Alberta (ERCB) – BC Oil and Gas Commission – Ground Water Protection Council – Alabama Dept. of Env Mgmt – Mississippi Dept of Env Quality – Alberta Energy

Owner/Operator/Producer – SaskPower – Southern Company – Cenovus – Denbury Resources – Chevron – Husky Energy

Supplier/Contractor/Consultant Interest – DNV – Schlumberger Carbon Services – Advanced Resources International Inc – Halliburton – Golder Associates – Baker Hughes

General Interest/Expertise – University of Alberta – Alberta Innovates-Technology Futures – World Resources Institute (WRI) – Global CCS Institute – International Energy Agency – PEW Center on Global Climate Change – Princeton University

CSA Z741

Table of Contents 1 Scope 2 Reference publications 3 Definitions 4 Management systems 5 Site screening, selection, and characterization 6 Risk management 7 Well infrastructure development 8 Monitoring and verification 9 Closure

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CSA Z741

Clause 4 Management systems

• Ensure that existing best practices are followed • Promote improvement • Clarify project operator roles and responsibilities • Detail principles; internal, external; HSE • Lay out communication requirements

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CSA Z741

Clause 5 Site screening, selection, and characterization

• Site screening advice • Criteria for site selection • Requirements and recommendations for

characterizations • Modeling parameters and outcomes

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CSA Z741

Clause 6 Risk management

• Consistent with ISO 31000 Risk management

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CSA Z741

Clause 7 Well infrastructure development

• CO2 specific requirements and references – Materials – Design – Construction – Corrosion control – O&M

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CSA Z741

Clause 8 Monitoring and verification

• Flexible and adapt to changes in conditions and phases • Not technology based • M&V objectives • Designing an M&V program

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CSA Z741

Clause 9 Closure

• Closure plan • Qualification process requirements • Preparing for decommissioning

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International Standards

CCS crosses international borders • Expertise is international • Project operators are transnational • Harmonization has benefits

National differences must be

acknowledged

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ISO and CCS

New CCS ISO TC 265 • Chaired by Canada (Sandra Locke) • Secretary Canada, twinned with China

Standardization of design, construction, operation, and environmental planning and management, risk management, quantification, monitoring and verification, and related activities in the field of carbon dioxide capture, transportation, and geological storage (CCS).

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TC265 Participation

Participating Countries

Australia Malaysia Canada Netherlands China Norway France South Africa Germany Spain Italy Switzerland Japan United Kingdom Korea United States 10 other observer nations

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TC 265 Structure

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CCS TC

Capture Group

Transportation Group Storage

Group

Cross-Cutting Group

Quant. & Verif. Group

Summary

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• There are challenges to implementing CCS • CSA Z741 can help

• alleviate public concerns about safety • facilitate compliance with the regulatory process • streamline approvals • mainstream leading practices

• CSA Z741 on CO2 storage is available for use • ISO is embarking upon international standards

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Email - jeff.walker@csagroup.org

The Impact of Z741 on Public Engagement and Safety

Jacqueline Sharp Managing Partner, Navius Research Inc.

Presentation Overview

• Z741 and Public Engagement • Z741 and Safety • Impact of Z741 on Public Engagement and Safety • Group Discussion Questions

Z741 and Public Engagement

Who is the “Public”?

• Stakeholders: individuals, groups, companies or organisations that believe their interests could be affected by a project and wish to participate in or have their interests represented in project decisions.

• ‘Public’ stakeholders: general public, local community, NGOs

•Other key stakeholders: government/ regulators, experts, employees, shareholders, suppliers, customers. Some crossover to ‘public’.

Public stakeholders grant or withhold social license to operate.

What is ‘engagement’? Engagement goes beyond informing and consulting.

PlanningNSW, 2003

Why does public engagement matter?

• Business case: reduce risk of project delays or cancellations due to opposition • Approvals: satisfy or exceed regulatory requirements • Project improvements: benefit from different viewpoints, challenged to address critical issues • Reputational benefits

Effective public engagement is a key risk mitigation tool.

Z741 and public engagement

Principles: • “Operate in an open and transparent fashion... to build public understanding, trust, and credibility” • Develop and implement a local stakeholder advisory strategy • Report on major milestones or unplanned events

“Identify project stakeholders early in the storage project life cycle and engage them during all phases of the project”

Z741 and public engagement cont.

Public Communications: • Include a trained designated media liaison and a designated individual to answer public questions • Involve the community in development of the outreach and engagement strategy • Communicate about the project early and often • Use public meetings, notices, and updates, site visits, potentially a local newsletter, social media • Communications should clearly share scientific, technical, and economic information, and focus on project issues and local benefits/concerns

Z741 and public engagement cont.

Communications continued: “The operator should engage the public in decision-making around aspects of the project where possible so that it addresses their concerns and meets local needs”

Z741 and public engagement cont.

• The ‘human culture’ context should be considered • Stakeholder interests should be considered, and their needs met to the extent practicable • Stakeholder views should be appropriately considered when defining the elements of concern, identifying criteria, and evaluating risk • Risk communication program should address rationale for site selection, risk management plans, response to unexpected events, stakeholder concerns/questions

The Risk Management process should include stakeholder consultation and communication.

Z741 and Safety

Safety Risks Associated with CCS

• Safety risk is a function of likelihood of occurrence and severity of consequences • The greatest consequences are associated with exposure of the public or workers to high concentrations of CO2. due to leakage or an accident • The likelihood of these events occurring is very low

The actual safety risks associated with CCS are low.

Z741 and Safety

• “Ensure the integrity of all facilities which includes preventing leakage” • “Develop and put in place an emergency response plan and team” • “Provide the appropriate resources to continually improve health, safety, and environmental protection”

“Ensure that health, safety, and environmental protection for workers and local communities are the project’s highest priorities”

Z741 and Safety cont.

Very detailed standards for: • Site characterization and assessment • Risk assessment and mitigation • Well materials and construction

• Operation & Maintenance and Monitoring & Verification plans designed to protect health, safety, and the environment

Virtually every section of Z741 includes requirements and recommendations to prevent leakage and ensure safety

Impact of Z741 on Stakeholder Engagement and Safety

Impact of Z741: Key Points

• Safety sections are quite detailed and prescriptive; public engagement sections are general and focus on principles

• Key is how Z741 affects perceived safety risks

• Public engagement sections may not provide sufficient guidance

Impact of Z741 on Safety

Safety: • Z741 should ensure implementation of best practices and further minimize safety risks • Perceived safety risk is the real issue • Public tends to focus only on severity of consequences, on which they can have misperceptions

Impact of Z741 on Perceived Safety

• The extent to which Z741 impacts perceived safety will depend on trust in CSA process and standard versus government regulations. • Successfully explaining probability of occurrence and addressing misperceptions about consequences requires risk communication • Z741 identifies objectives for risk communication but not how to conduct effective risk communication

Risk Communication Best Practices

• Use language appropriate for the audience () • Be open and honest () • Put risks in context public understands • Where possible, partner with trusted messengers • Acknowledge knowledge gaps and identify plans to address them • Make extensive project information available

Impact of Z741 on Public Engagement

• Engage early and often () • Use a variety of communication/engagement mechanisms () • Meaningfully involve stakeholders in project decisions ()

Specifics • Conduct social site characterization at the project outset to identify stakeholders, concerns, misperceptions • Start engagement even before site characterization • Develop and implement processes to obtain and incorporate stakeholder feedback

Public engagement principles generally reflect best practices but do not provide detail on implementation.

Standards, Public Engagement, and Safety

• Are the standards achievable? • Are the standards sufficient? • Are the standards detailed enough? Should they be more prescriptive about public engagement and risk communication? • Are the standards applicable worldwide?

Group discussion questions:

www.NaviusResearch.com

Questions?

Navius Research Inc. Vancouver | Toronto

CSA Z741-12 – Geological Storage of CO2:

Impact on Project Costs

Allan Greeves Manager, Weyburn

Cenovus Energy Inc. Global CCS Institute Workshop | Calgary, AB | June 6, 2013

Disclaimer

This document contains forward-looking information prepared and provided for the sole purpose of facilitating public consultation in respect of regulatory applications and is not intended to be, and should not be, relied upon for the purpose of making investment decisions, including without limitation, to purchase, hold or sell any securities of Cenovus Energy Inc. Additional information regarding Cenovus Energy Inc. is available at www.cenovus.com.

Impact of standards on project costs

• How can we set guidelines to ensure effective standards that are not overly prescriptive, causing unnecessary costs (Capex, Opex, MMV)?

• Can standards in fact lower the life-cycle costs of a project?

• To what extent have projects been used as guideposts or adoption from other projects such as in the oil and gas industry?

Impacts of standards on project costs

• Impetus for standard development – 1.1 (a) “This Standard establishes requirements and

recommendations for the geological storage of carbon dioxide. The purpose of these requirements is to promote environmentally safe and long-term containment of carbon dioxide in a way that minimizes risks to the environment and human health.” 1

– Standards provides operators, regulators and the public with knowledge sharing, careful considerations applicable with the storage of CO2, and provides guidance for project planning

1. CSA 741-12 Geological storage of carbon dioxide, October 2012, Pg 1.

CSA Z741-12 Geological Storage of CO2 Storage project life cycle

Post-injection period

Entity

Site screening

and selection period

Site characterization

period

Design and development

period

Operational period

Closure period

Post closure period (not included in

the Standard)

(Private) operator

Regulatory authority

Designated authority

Limits of the Standard

Iterative process

Injection starts

Cessation of injection

Source: CSA Z741-12 Geological storage of carbon dioxide, October 2012, Pg 2

Application of standards

• CSA Z741-12 was created by a diverse team of experts – Oil & gas E&P companies – Oil & gas service companies – Environmental NGO’s – University researchers – Research organizations – Regulators – Environmental service companies

– The technical committee worked hard to find the balance between

prescriptiveness and flexibility to incorporate site specific conditions

Applying standards • A proponent is considering its options for reducing

its carbon footprint – Is geological storage an option? – Where to begin?

• Standards provide guidance as to the expectations

and considerations necessary for a successful project: – Reduce cycle time to understanding the potential scope

of the project – Provide guidance on the expertize necessary to evaluate

the project

Continuous improvement Continuous improvement is a key component of CSA Z741-12 • Recognition of ever improving

technology • Recognition of ever changing

expectations • Opportunity to reduce costs

with increased industry knowledge

• Opportunity to reduce costs with increased site specific knowledge

Plan Execute

Review Improve

Project life cycle – stage gate cost profile Site

Scr

eeni

ng

Site

Sel

ectio

n

Site

Cha

ract

eriz

atio

n

Time

Cum

ulat

ive

Cos

t

Monitoring & verification

Site screening, selection & characterization

Site screening Cost considerations

• Storage capacity

• Potential injection capability

• Seal (above & below) the storage unit

• Seismic or tectonic stability

• Faulting / fracturing

• Over-pressured systems

• Hydrodynamic system

• Number of wells already penetrating

the seals / storage unit

• Primarily an ‘office’ assessment

• Utilizes readily available data &

information

• May not require the acquisition of new

data

• May require additional consulting

expertise to conduct the review

• Iterative process – may need to

evaluate several potential storage units

Site screening, selection & characterization

Site selection Cost considerations

• Builds upon site screening information and

analysis

• Further refines understanding of capacity,

injectivity, storage security (seal integrity

due to faulting, existing wells, etc)

• Explores other requirements like pore space

ownership, other subsurface activities,

surface considerations (lakes, rivers,

population centres, land use, etc)

• Continue to use existing data & information

• Review of core from existing wells,

petrophysical well log analysis, simple

models to assess injectivity, pressure /

hydrodynamic studies

• Review of mineral land tenure records

• Review of surface culture and future land

use including restrictions due to

environmental or heritage concerns

Site screening, selection & characterization

Site characterization & assessment Cost considerations

Detailed assessment of:

• Geology & hydrogeology of the storage unit

• Characterization of confining strata

• Primary seal

• Secondary barriers to CO2 leakage

• Baseline geochemistry

• Baseline geomechanics

• Well characterization

At this stage new data may be required including: • Seismic data (2D & possibly 3D) • May include the drilling of an exploration or

pilot well for: • Core & core analysis of storage unit

and seal(s) • petrophysical & cased hole logging • DST & well test data (pressure,

injectivity, existing pore fluid analysis) • Lab studies of fluid compatibility (CO2 with

rock, pore fluids) • Lab assessment of rock strength properties,

thermal properties, rock deposition & mineralization characteristics

Site screening, selection & characterization Modeling for site characterization Cost considerations

Integration of the acquired data will allow the construction of: • Geological static model - areal extent,

stratigraphy, lithology / facies, structure, porosity / permeability distribution, pore saturations, pressure / geothermal regime, initial stress regime

• Flow modeling – assess storage capacity, injectivity, pressure and plume distribution & movement, fate of displaced water

• Geochemical modeling – chemical reactions between injected CO2 and storage unit rock & fluids, mineral trapping

• Geomechanical modeling – strength of the primary seal, fault reactivation, potential for induced seismicity, impact on well integrity

• Integration of existing and captured data into these various models will require skilled expertise in various geology, geophysics and engineering

• Modeling requires calibration to known behavior (history matching)

• Modeling will allow for scenario analysis of areas of uncertainty

• Modeling will have an impact on the time allocated to assess the potential site

• Modeling will help inform the proponent as well as the regulator and public of the subsurface impact of the storage project

• Modeling will be an iterative effort, incorporating new data as it becomes available (piloting, development)

Well infrastructure development

• Well construction includes the design & execution for the creation of: – Wellbore – Internal well completion, – Surface wellhead – Abandonment of infrastructure at the end of the

project

Wellbore design – what makes a well CO2 compliant?

• Number of casing strings required – Groundwater protection

– Protection of porous zones above storage unit

– Potential lost circulation zones

• Designing to expected service conditions: – Is the CO2 stream dehydrated?

– Does the stream contain excessive impurities (NOx, SOx, H2S, O2)?

– Pressure

– Temperature

• Anticipated injection rates – Hole/casing diameter appropriate for the injection

string and packer assembly required

• Core, DST, logging requirements • Monitoring

Wellbore design – drilling to make a well CO2 compliant

Drill & Case • Typical oil and gas well design includes

3 casing strings: conductor, surface casing & production (long-string)

• Only the long-string is in contact with the CO2 storage unit

• CSA Z741 requires the casing across the storage unit be made of corrosion material like chrome or stainless steel

• CSA Z741 refers to various API specifications for cementing but also expects cement design to offer additional chemical resistance to CO2 degradation to apply latest technologies

Wellbore design – what makes a well CO2 compliant?

Drill & Case (other considerations) • High standard of care / QA/QC

– Drilling mud system – Attention to casing centralization

particularly over storage unit, primary seal and secondary seal

– Cement blend preparation and placement (compatible water, additive concentrations, over displacement, etc)

• What kind of monitoring is required? – Monitoring well vs injection well – Piloting well vs development well – Accessibility required for time lapsed

evaluation – Integrity concerns balanced against

accessibility, monitoring equipment

Drilling a CO2 compliant wellbore Vertical Well Drilling Costs

Consulting & Supervision Logging, Coring, Mud Gas

Surface Casing & Cement Production Casing & Cement

Drilling Rig & Support Mud Systems & Disposal

Other Services

• Approximately 1/3 of the cost of drilling a well is for casing and cement left in the hole

• Remainder of the costs are for drilling and evaluation of the well

Wellbore design – what makes a well CO2 compliant?

Well completion • Designing to expected service

conditions: • Is the CO2 stream dehydrated? • Does the stream contain excessive

impurities (NOx, SOx, H2S, O2)? • Pressure • Temperature

• Anticipated injection rates • Annulus inhibited fluid type • Cement & casing integrity logging

requirements • Monitoring requirements

Materials selection

• Upgraded materials like this packer element may be required to avoid adverse effects due to CO2

Impact of service conditions

• This coiled tubing was recovered from an injection well converted from straight CO2 injection to a water-alternating-gas (WAG) injection configuration

• Drehydrated CO2

• Non-coated tubulars • Coiled tubing string was in place

for ~12 years with little corrosion with exception of this point midway down the well

Wellbore design – what makes a wellhead CO2 compliant?

Wellhead design • Designing to expected service

conditions: • Is the CO2 stream dehydrated? • Does the stream contain excessive

impurities (NOx, SOx, H2S, O2)? • Pressure • Temperature

• Anticipated injection rates • Monitoring requirements • Accessibility requirements to the

wellbore • Flow / ESD control

Designing surface piping

CO2 compatible seals in surface piping: • CO2 does behave differently

than oil & gas industry fluids • Sometimes it takes a ‘low

tech’ way of troubleshooting for performance improvement

Monitoring & verification Monitoring & verification Cost considerations “Measurement and surveillance activities necessary to provide and assurance of the integrity of CO2 storage”2:

• Used at all stages of development – begins with baseline data right through to the closure of the project

• Provide evidence that CO2 placement is secure

• Allows for comparisons between predicted and actual conditions

• various data points and perspectives from seismic, to injection wells and observation wells

• models updated with actual performance data allow for performance improvement and confidence in ultimate fate of CO2

• Support quantification efforts

• Is not just one method of monitoring

• Is a suite of site specific approaches to compare to baseline

• Will require additional project expenditures for:

• Seismic

• Observation wells

• Specialty hardware in injection wells

• Pressure, temperature, flow, composition monitoring equipment / tools

• Data capture instrumentation and analysis (ie: SCADA)

• Repeated capture over time

• Updated over time as necessary

• Expanded over time as necessary

2. CSA 741-12 Geological storage of carbon dioxide, October 2012, Pg 55.

Closure Closure Cost considerations “purpose… is to provide guidance to and establish predictability for project operators and regulatory authorities of.. a) Sufficient understanding of storage site’s

characteristics b) Low residual risk c) Adequate well integrity” 3

• Includes incorporation of learning’s throughout the project life

• Development infrastructure in place and its condition

• Monitoring & verification results

• Integration of project performance data into dynamic models

• Updated risk management plan

• Includes the abandonment of storage infrastructure wells and facilities

• Will likely be done in a staged approach to monitor for well integrity and containment effectiveness

• Will take some time (year’s) to provide confidence for risk management plan

• Need to continue monitoring efforts

• Need to retain experts who will update dynamic models

• End result will ‘qualify’ project for potential hand off to designated authority

3. CSA 741-12 Geological storage of carbon dioxide, October 2012, Pg 60

Summary • By providing guidance and expectations

standards can lower the life-cycle costs of a project

– Improve project understanding with baseline work and monitoring

– Application of best practices for development design and quality

– Integrate risk assessment with monitoring & verification to identify specific areas of concern

• Learning’s from the oil & gas industry are directly applicable

– Complementary skills – Complementary resources and

equipment

• End result is a project with maximum benefit with effectively managed risks

• Special thanks to:

– Canadian Standards Association – Cenovus Energy Inc.

Questions?

Session 4 Will Z741 Mitigate Project Risks?

The Role of Storage Standards in the Deployment of CCS

Rob Bioletti, P.Eng. Director, CCS Policy

Government of Alberta June 6, 2013

Reasons for Standardization

86

Climate Change Mitigation

• No one technology can stabilize greenhouse gas emissions alone.

• A combination of several climate mitigation technologies is needed for robust climate change.

• Standards will aid in the widespread deployment of CCS.

87

Knowledge Sharing and Innovation • Standards will aid in the transfer of

knowledge between jurisdictions.

• Standards need not be prescriptive.

• Organizational structure can aid in separating well defined versus emerging activities.

88

Public Perception of CCS

• Public opposition has caused cancelation of several CCS projects throughout the world.

• Standards can help provide assurances that

CCS is safe.

89

CSA Z741

How this Standard Can Mitigate CCS Project Risks

90

Site Screening, Selection, and Characterization - Section 5 Site screening and selection will identify prospective CO2 storage sites that have met the following criteria: • Sufficient Capacity; • Sufficient Injectivity; and • Effective Retention.

91

Risk Management – Section 6

Effective risk management should: • Demonstrate achievement of objectives; • Improve performance relative to elements of

concern; • Support strategic planning; • Develop robust project and change management

processes; • Help decision makers make informed and

prioritized choices; • Account for uncertainty; and • Recognize stakeholder intentions.

92

Well Infrastructure Development - Section 7 Outline criteria needing to be met in order to best mitigate risk (CO2 leaks, infrastructure problems, etc.) such criteria include: • Materials; • Design; • Construction; • Corrosion Control; and • Operation and Maintenance.

93

Monitoring and Verification – Section 8

The monitoring and verification standard will be flexible and adaptable to changes in storage and injection conditions, the criteria the standards will address the following concerns: • Health, • Safety, • Environmental Risks; and • Storage Performance

94

Risks for CCS Projects

95

Risk Profile for a CO2 Storage Site

Source: Benson 2007

Examples of Other Risk Elements

• Environmental – Natural environment – Health and safety – Legal and regulatory environment

• Economic – Project financing – Competition with other resources

• Social – Public support – Politics

97

Risk Management Process

98

Source: CSA-Z741-12

99

Group Activity!

Question:

Which risk element is the most important to address for CCS projects?

Tool: Simplified Decision Matrix

Assessing the relative importance of alternatives

Steps 1. Brainstorm up to 5 risk elements - Environmental (e.g. operational, safety, regulatory) - Economic (e.g. financing, resource competition) - Social (e.g. public support, reputation, politics)

2. Assign weights to each element - Stakeholder views: Petroleum engineer, policy analyst, farmer, professor, activist, etc - Scale of 1 to 3 (1 = low importance, 3 = high importance) - Group must agree on the weight!

3. Score each risk by stakeholder perspective - Scale of 1 to 5 (1 = low importance, 5 = high importance)

4. Multiply stakeholder scores by weight 5. Total all scores to find “winner” 6. If there is disagreement, re-visit weights or scores

100

Example Decision Matrix

101

Stakeholder Score (1 - 5)

Industry Government Public Academic 3 (x1) = 3 1 (x1) = 1 2 (x1) = 2

Total 5+3+1+2

= 11 5 (x1) = 5

4 (x2) = 8

4 (x3) = 12

2 (x1) = 2

Weight (1 - 3)

1

2

3

1

Risk Element

Financing

Public Support Safety

Etc.

Etc.

Brainstorm Agree Assess

Discussion

1. What were the results? Did one clear winner emerge?

2. How did stakeholder views help or hinder the decisions?

3. Should certain risk elements have more focus?

4. How can CSA Z741 help mitigate these risks? Are there areas for improvement?

102

Thank You

Rob Bioletti, P.Eng.

+1 780 644 3204 Rob.Bioletti@gov.ab.ca

www.energy.alberta.ca