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One More Time – Tar Sands Firms Pitched for SMRs

Dan Yurman's picture
Editor & Publisher NeutronBytes, a blog about nuclear energy

Publisher of NeutronBytes, a blog about nuclear energy online since 2007.  Consultant and project manager for technology innovation processes and new product / program development for commercial...

  • Member since 2018
  • 1,427 items added with 975,505 views
  • Jun 13, 2021 1:02 pm GMT
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  • Latest Efforts to Bring SMRs to Alberta’s Tar Sands Hits Investor Headwinds
  • South Korea Seeks Global Role in Launch of Nuclear Powered Cargo Ships
  • Russia Starts Building a Lead-cooled Fast Reactor
  • China Approves Construction of Its First SMR
  • China Remains Committed to Building a Hualong One at UK Bradwell Site
  • Third Try May Be the Charm for UK Moorside Project
  • Vatanfall Takes Equity Stake in Fermi Energia

Once More Time – Tar Sands Firms Pitched for SMRs

Since the late 1980s reactor developers in Canada and elsewhere have been pitching the idea of building nuclear reactors to provide steam and process heat to the tar sands operations in Alberta. All of these proposals have eventually been set aside because the developers could not deliver their reactors within five years of breaking ground which is the capital spending time horizon of the tar sands companies.

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What’s apparently different this time is that Canada’s largest oil sands producers have formed an alliance that plans to work with federal and provincial government to achieve net-zero greenhouse gas emissions from their operations by 2050.

tar sands processing plantThe Oil Sands Pathways to Net Zero initiative will evaluate and accelerate the application of emerging emissions-reducing technologies including small modular nuclear reactors. The firms in the alliance account for 90% of tar sands oil production.

The province of Alberta last year joined New Brunswick, Ontario and Saskatchewan in a Memorandum of Understanding to work together to support the development and deployment of SMRs.

Alberta Minister of Energy Sonya Savage said the new initiative would “strengthen our position” as global ESG (environment, social and governance) leaders. “This initiative will also pave the way for continued technological advancements, ultimately leading to the production of net zero barrels of oil.”

Will SMRs be Ready for the Tar Sands?

None of the 13 SMRs currently in CNSC’s vendor design review (VDR) process are even close to getting a license much less being able to deliver an SMR in five years or less to a tar sands oil company. Only three are LWR type designs which have the fastest path to market. The other ten are advanced designs which will take longer to be ready for commercial sale. If any of these SMRs are candidates for the tar sands by the end of this decade it will be the designs based on conventional light water reactor technologies.

process heat CNSC VDR firms

  • Seven of 14 designs have reactor outlet heat values greater than 500 C. These designs, although they are advanced reactors with longer times to market, will be of significant interest to the tar sands operations.
  • Only five of 13 designs have completed Phase 1 of the VDR process
  • Five other designs have started Phase 1; One is on hold , and Two have not yet applied but intend to apply but have not set a date to do so.
  • Four of seven are HTGR; Three are molten salt
  • Seven of 13 designs are using either TRISO or HALEU fuel with U235 > 5%. Testing and qualifying fuels, and buying fuel in commercial quantities are key challenges for these developers.

Canada’s Drive for Decarbonization as a Demand Factor

A key driver of demand for SMRs by the tar sands industry is that Canadian Prime Minister Justin Trudeau plans to raise Canada’s carbon price steeply over time to position the country for carbon-neutral status by 2050. The oil and gas sector accounted for 26% of Canada’s carbon emissions in 2018 according to a Reuters report. SMRs could provide a zero-carbon source of process heat and power for such operations, which are typically in off-grid locations.

It is important to keep in mind that having zero CO2 emissions from the process heat operations of tar sands does nothing to mitigate the CO2 emissions from burning the oil extracted from the Alberta sites. As a practical matter all the “talk” about decarbonization isn’t going to change the fact that the global market for fossil fuels, including oil, will decline only slowly over the balance of this century and the use of oil as a feedstock for other industrial chemicals will continue long after all of us are driving electric cars.

Investors Wary of Tars Sands Firms Spending Plans

According to Reuters, some investors and lenders warn they could walk away if more cash is not spent on projects that transition the tar sands companies for a low-carbon future. Other investors have criticized the proposed initiative.

“They have these ambitious transition targets and a relatively short window to make people believe that their transition plans are real,” said Jamie Bonham, director of corporate engagement at NEI Investments, which owns shares in all three oil sands producers worth a combined C$71 million. He said NEI could divest or vote against directors if progress does not come soon.

“We will take into account whether they’re moving in the right direction,” said Steve Peacher, president of SLC Management, an investment subsidiary of Sun Life Financial. “We won’t lend to energy firms that we don’t think are doing that.”

For their part the oil sands firms said that pressure from shareholders is high to pay dividends, repurchase outstanding shares, and reduce debt.

“If you’re structurally cutting shareholder returns to take their cash and invest it in the transition, that’s going to be tough, because we need the support of the shareholders and the capital markets,” Suncor Chief Executive Mark Little said.

Reuters also reported last April that New York’s state pension fund is restricting investment in six Canadian oil sands companies because they have not shown they are prepared for a transition to a low-carbon future, the fund’s Comptroller Thomas DiNapoli said.

The New York State Common Retirement Fund will divest more than $7 million in securities already held in the companies, and not make any further investments in them. This amount by itself isn’t a lot in the world of oil investment pools. The significance of the action is the the fund is responding to stakeholder pressures related to global warming and it is an indication that other large institutional investors may follow New York’s lead.

Tar sands hold the world’s third-largest crude reserves, according to Natural Resources Canada and have some of the highest emissions per barrel of oil produced due to the carbon-intensive production process of extracting tar-like bitumen from the ground..

Oil sands are a mixture of bitumen, a thick, sticky form of crude oil, sand, water and clay. Canada’s oil sands. The bitumen in oil sands does not flow like conventional crude oil, so it must be mined or heated underground using steam – produced using natural gas – and further processed with steam heat, provided by burning oil and natural gas to recover bitumen from the sand.

Tar Sands Firms Ask for Government Financial Assistance

The alliance of tar sands firms, which includes Canadian Natural Resources (CNQ.TO), Cenovus Energy (CVE.TO), Imperial Oil (IMO.TO), MEG Energy (MEG.TO) and Suncor Energy (SU.TO), said it will work with federal and Alberta governments to help Canada meet its climate goals.

In addition to looking at SMRs to make steam, instead of burning the very oil they extract for this purpose, oil sands producers said they would use hydrogen instead of natural gas for oil sands facilities. In the future, the firms plan to look into CO2 sequestration technologies as a mitigation measure.

Alberta has asked Ottawa to fund a C$30-billion, 10-year program to develop carbon capture. The federal government will require the companies to share the costs of any carbon-capture initiatives. It isn’t clear whether the Canadian government is planning to spend that kind on money on what is essentially a private sector initiative.

 

South Korea Seeks Global Role in Launch of Nuclear Powered Cargo Ships

(The Maritime Executive) South Korean shipbuilder Samsung Heavy Industries will undertake a joint research and development project with the Korea Atomic Energy Research Institute (KAERI), to develop nuclear-powered ships.

Samsung_heavy_industries-780x470

                                                                                A Samsung Heavy Industries Shipyard in South Korea

Based on a strategic cooperative agreement, they plan to explore the opportunities to use nuclear power as a solution for carbon-neutral shipping. The plan is to harness Samsung’s expertise in ship building with KAERI’s expertise in nuclear reactor technologies.

Samsung said in its press statement that it will be working with a small modular reactors based on molten salt reactor (MSR) design principles. The firm said it chose this design because it is seen as a safer, lightweight solution that would require less capital investment for the shipping industry than other alternative fuels and propulsion systems. It can use commercial grade nuclear fuel and does not require the high-pressure water-cooling systems used in large land based reactors.

Of great importance to Samsung is that it wants to decarbonize the future ships it builds for customers who are asking for it.

“MSR is a carbon-free energy source that can efficiently respond to climate change issues and is a next-generation technology that meets the vision of Samsung Heavy Industries,” said Jin-Taek Jung, president of Samsung Heavy Industries. “We plan to focus our R&D efforts to create a new future growth engine.”

One aspect of the design noted is that in it the uranium fuel is to be mixed with a chloride salt. The hot salt coming out of the reactor’s primary loop would then interact with a secondary steam system to produce high pressure steam to drive the ship.

Through the agreement, Samsung plans to pioneer the MSR-based floating nuclear power plant and a nuclear-powered ship market as part of its future new business expansion. The research will include MSR technology and related equipment development, such as heat exchangers, offshore nuclear product design and business model development, performance verification, and economic evaluation.

Among the advantages Samsung sees for the technology is that the life of the reactor is projected at 20 years, the same as the life of the vessel, meaning the ship would not need to refuel. The partners in this deal highlight that the size of the reactor is relatively small, so it has the advantage of easy application to ships. In addition, the MSR design provides a higher level of safety and would prevent serious accidents.

While Samsung Heaving Industries has extensive experience and history building ships, KAERI does not list expertise with molten salt reactors (MSR) on its website. The IAEA ARIS database does not list any MSR based advanced reactor work ongoing in South Korea.

Assuming the MSR technology is the chosen path forward, the partners are either planning to develop an MSR-based small modular reactor from scratch or acquire the intellectual property for one that is already designed by another organization outside of South Korea.

 

Russia Starts Building a Lead-cooled Fast Reactor

(WNN) Russian nuclear fuel manufacturer TVEL has announced the start of construction of a 300 MWe nuclear power unit whichis the BREST-OD-300 lead-cooled fast reactor at the site of the Siberian Chemical Combine, in Seversk. The reactor will run on mixed uranium-plutonium nitride (MNUP) fuel. The construction license was issued in February 2021.

brest image

TVEL said that its plans call for a nuclear power plant powered by a fast reactor to be built alongside closed nuclear fuel cycle servicing enterprises on one site. It will be an integral part of the Pilot Demonstration Energy Complex (PDEC) – a cluster of three interconnected facilities, including the nuclear fuel production plant (for fabrication and re-fabrication), the BREST-OD-300 power unit, and the facility for irradiated fuel reprocessing to make new fuel.

brest tech specs

                                                              Technical Specifications of the BREST OD-300

After reprocessing, the irradiated fuel from the reactor will be sent for re-fabrication, thereby giving this system the means to become “practically autonomous and independent of external resources supplies”, said TVEL.

TVEL President Natalia Nikipelova told World Nuclear News that the Breakthrough project concerns not merely the development of innovative reactors, but also the introduction of a new generation of nuclear fuel cycle technologies. Production of dense nitride MNUP fuel will ensure the efficient operation of a lead-cooled fast reactor and consist entirely of recycled nuclear materials such as plutonium and depleted uranium,

A fuel production facility and an irradiated fuel reprocessing module are scheduled to be built by 2023 and 2024, respectively. The BREST-OD-300 reactor is expected to start operation in 2026.

 

China Approves Construction of Its First SMR

(WNN) The construction of a demonstration ACP100 small modular reactor (SMR) at Changjiang in Hainan province (an island in the Gulf of Tonkin) has been approved by China’s National Development and Reform Commission. The multi-purpose 125MWe pressurized water reactor (PWR) – also referred to as the Linglong One – is designed for electricity production, heating, steam production or seawater desalination. According to CNNC the reactor is expected to be installed in a configuration of two units per site.

China National Nuclear Corporation (CNNC) said in a statement to investors, “The small reactor demonstration project is of great significance to promote the safe development and independent innovation of nuclear power.”

However, the firm did not commit to a start date for construction of the demonstration ACP100 nor when it is due to be commissioned. The design has been under development since 2010. In 2016, the design became the first SMR to pass a safety review by the International Atomic Energy Agency. (Technical briefing to IAEA – PDF file)

The ACP100 was identified as a ‘key project’ in China’s 12th Five-Year Plan, and is developed from the larger ACP1000 PWR. The design, which has 57 fuel assemblies and integral steam generators, incorporates passive safety features and will be installed underground.

In 2016, China announced plans to build a demonstration floating nuclear power plant based on the ACP100S variant of the CNNC design. The initial “customer” for the plants is the Chinese military which plans to use the SMRs to provide power to artificial islands it has built in the South China Sea.

The demonstration of the first ACP100 plant would be located on the north-west side of the existing Changjiang nuclear power plant. The site is already home to two operating CNP600 PWRs, while the construction of the first of two Hualong One units began in March this year. Both those units are due to enter commercial operation by the end of 2026.

 

China Remains Committed to Building a Hualong One at the UK Bradwell Site

The Bloomberg wire service reported earlier this year that despite occasional diplomatic spats between China and the UK, both countries remain committed to a deal that would bring Chinese commercial nuclear reactors to the UK.

China General Nuclear’s Chief Executive Officer Rob Davies told the Bloomberg wire service CGN is committed to nuclear development in the U.K. regardless of the political winds.

He said the company is willing to self-finance the Bradwell B project in southeast England. He added that the company would take a market power price for electricity sold from the plant which is a break from EDF’s move at Hinkley Point to secure a long-term contract for rates.

The project would be a Chinese-designed reactor, called HPR1000 also known as the Hualong One. It would showcase China’s technical skill in Europe. The plan could involve up to three the reactors at the site.

Davis added that, “We plan to maintain our support for Hinkley Point C, to help Sizewell C to reach a Final Investment Decision, to complete the general design assessment for the HPR1000 and to continue with Bradwell. “

The political viability of the project has been questioned due to pressure from the US and the UK government clamped down on the sale 5G mobile technology from Huawei Technologies Ltd. Some members of the UK Parliament have raised security concerns about allowing China to build its reactors in the UK.

As a practical matter, China is deeply committed to nuclear power in the UK having taken a one-third equity stake in the Hinkley Point C project and has planned to take a similar stake in the Sizewell C project.

In return, the UK has promised China the right to build the Hualong One at Bradwell. The reactor design is in the fourth and final stage of the UK generic design assessment which is the safety and environmental review conducted by the UK Office of Nuclear Regulation.

The trade press site Nuclear Engineering International reported in April of this year that the progress of the Hualong One through the UK Generic Design Assessment Process has documented the remaining issues to completing it.

 

Third Try May Be the Charm for Moorside

(BBC) Plans for two nuclear power plants on the site of the previously abandoned Moorside project in Cumbria have been submitted to the UK government. The EDF-led Moorside consortium wants to build two 1650 MWE EPR pressurized water reactors similar to the units being built at the Hinkley Point C site and which are also proposed for the Sizewell C site.

Previously, Japan’s Toshia Corp. had planned to build three Westinghouse 1150 MWe AP1000 PWRs at the site, but abandoned it due to self-inflicted financial difficulties. Toshiba was revealed to have cooked its books by reporting huge amounts of revenue that never occured and Westinghouse went bankrupt due to mismanagement by the firm and fraud by the utility at the V C Sumnmer project in South Carolina.

The latest plan to revive the Moorside project includes an effort to attract developers of the Rolls-Royce-led UK SMR consortium. That firm is developing plans to deploy 16 of its 440 MWE PWR at various sites in the UK.

Copeland MP Trudy Harrison is keen for the plans to go ahead as she sees the industry being fundamental for the area.

She told the BBC, “Nuclear technologies have a key role to play in our clean energy future and the vision for a Clean Energy Hub around Moorside shows how the whole industry including our local communities and supply chains to ready to deliver a Green Industrial Revolution for the UK.”

“Nuclear is what Copeland does best and I am continuing to work closely with the Moorside Consortium as well as the Nuclear Delivery Group and Government on projects across robotics, fusion, decommissioning, hydrogen, and next generation reactors.”

 

Vatanfall Takes Equity Stake in Fermi Energia

Vattenfall has signed an agreement with the Estonian nuclear energy start-up company Fermi Energia in order to become a minority shareholder of the company with a seed investment of Euro 1 million. Vattenfall has become a minority shareholder of approximately six percent ownership.

The extended collaboration will further explore the maturity of SMR technology and the prospects for deployment of one or several such reactors in Estonia.

Under the agreement of the Letter-of-Intent dating from November 2020, Vattenfall is studying the potential for the deployment of small modular reactors in Estonia, especially addressing costing and constructability aspects, supply chain, operations/personnel/maintenance, and newbuild financing structure.

“With this minority investment, Vattenfall can contribute our know-how and work jointly on feasibility studies about costing, supply chain and capabilities to construct and operate Small Modular Reactor technology. Innovative and fossil free future nuclear generation such as SMR seems very promising for Estonia that has the highest average CO2 emissions per generated kWh of electricity among all EU member states,” says Torbjörn Wahlborg, Senior Vice President Generation at Vattenfall.

He said that with this investment Vattenfall sees potential in Fermi Energia’s business model and the company’s prospects to submit an application of Decision in Principle for the deployment of SMR technology in Estonia. Work could start on an SMR as early as 2026.

Kalev Kallemets, CEO of Fermi Energia, said “Fermi Energia considers true decarbonization of Estonian economy impossible without reliable, affordable low carbon power supply from nuclear energy. For Estonia, only Small Modular Reactors (SMR) as currently developed in the US, Canada and UK are suitable.”

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Bob Meinetz's picture
Bob Meinetz on Jun 13, 2021

"This initiative will also pave the way for continued technological advancements, ultimately leading to the production of net zero barrels of oil.”

Dan, though I have a fair understanding of what's required to produce zero barrels of oil, or 225,000 barrels of oil, I can't imagine what technological advancement might enable a company to produce net zero barrels of oil.

Shouldn't producing at least one net zero barrel of oil be pre-requisite for launching new programs to produce millions of barrels of the traditional, climate-killing kind?

Dan Yurman's picture
Dan Yurman on Jun 14, 2021

Normally, I'm cautious about using sarcasm in response to a genuine statement from a top government official, in this case, Canada. However, in this instance I think it is fully justified. :-)

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