Frequently Asked Questions
WHAT IS PACIFIC FUTURE ENERGY?
[/vc_column_text][vc_column_text]Pacific Future Energy Corporation is a Vancouver-based company developed to finance, design and construct the world’s greenest bitumen-to-fuels refinery in British Columbia, Canada.
One of our key principles is that First Nations are a First Order of Government. We will work together with the First Nations in the area to consider the project and to support informed decision-making. We are at the early stages of our relationships.
Our approach is “First Nations First”, which we respect as the new industry standard. We recognize and respect First Nations’ title and rights, the processes of the different First Nations, and their inter-relationships. We also respect their regulatory processes. We will proceed with our project only if we are welcomed and supported.
The management team consists of leaders from the venture-capital, corporate, energy, First Nations, engineering, and government sectors who fervently believe that a new approach is needed if Canada wants to gain new market access for Canada’s bitumen.
We believe that this new approach must include building the greenest bitumen refinery in the world, transporting our feedstock in the safest manner over land, and not shipping any bitumen in tankers on our northwest coastal waters, in accordance with the oil-tanker moratorium which is expected to be formalized and extended by the federal government in the spring of 2017. (Ottawa has made it clear that shipping refined fuels such as ours will be permitted under the tanker moratorium.)
On January 14, 2016, the company submitted its draft Project Description to federal and provincial environmental agencies. On June 17, 2016, we submitted our final “Project Description” document (taking into account all comments and feedback received). That kicked off a governmental review process that could take up to two years.
We see a unique opportunity to turn Western Canadian bitumen into high-value refined products for the world’s fastest-growing energy markets, while at the same time ensuring that the refining process and transportation follow the highest environmental standards.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][grve_divider line_type=”line”][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]
WHY ARE YOU PROPOSING THIS REFINERY?
[/vc_column_text][vc_column_text]In short, it’s about opening up new market access for Western Canadian energy resources as refined fuels, to serve markets at home and abroad, especially fast-growing and future markets in Asia, via British Columbia. It’s also about environmental stewardship, sustainable solutions, and keeping large tankers carrying bitumen or heavy crude oil off our BC waters.
By refining bitumen on Canada’s West Coast, we will add value to one of the world’s largest energy resources. We will keep money at home, to help pay for education, healthcare and other public services, to provide long-term jobs, and to export less in jobs and value to other countries.
Canada has the third-largest oil reserves in the world, but that oil is in effect “trapped”—more than 97% of Canadian oil exports go to just one customer: the USA. And if there’s only one customer, we all know who sets the price. Lack of access to overseas markets costs Canada an estimated $20 billion a year. Our refinery will help bring some of that revenue home.
The U.S. is increasing the output of its own oil, at the same time. That’s one more reason why we need to enter Asian markets.
The Asian Development Bank predicts that Asia-Pacific nations will increase their energy demand by 67% by 2035. We will help meet that demand, in a more environmentally and socially sustainable way than anyone in the refining industry to date.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][grve_divider line_type=”line”][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]
WHAT DOES “NEAR ZERO NET CARBON” MEAN?
[/vc_column_text][vc_column_text]Pacific Future Energy plans to build a refinery that will refine bitumen from Western Canadian oilsands into diesel, gasoline, aviation fuel and other products.
Our plan is for a Near Zero Net Carbon Emissions facility—as close as we can possibly get to zero carbon emissions with the latest in equipment and the latest in technology and skills, in an economically feasible fashion.
Some important features:
- Use of the best available technology and the highest possible operational efficiency to process Canadian resources;
- The highest amount of water recycling and treatment;
- Maximum recovery of carbon dioxide;
- The use of clean energy to power the refinery;
- Capturing carbon from various processes
To those, add the smallest environmental footprint.
Our products will be of the highest environmental standard, and we will produce no coke. That’s important, as coke products are a significant source of greenhouse gas emissions associated with traditional refineries.
There is overwhelming scientific evidence that our planet’s climate is changing due to the use of fossil fuels. Innovative solutions will be required for the world to achieve its goal of limiting temperature change to 1.5 degrees from pre-industrial levels. We believe that our “Near Zero Net Carbon Emissions” facility will be one of those innovative solutions, given that it will significantly reduce the overall carbon impact of the upstream feedstock we will be refining.[/vc_column_text][/vc_column][/vc_row][vc_row bg_type=”color” footer_feature=”yes” bg_color=”#e0e0e0″ padding_top=”50″ padding_bottom=”0″ margin_bottom=”0″][vc_column][vc_column_text]
[/vc_column_text][vc_tta_accordion c_align=”center” c_icon=”” active_section=”0″ collapsible_all=”true”][vc_tta_section title=”Where Will The Refinery Be Located?” tab_id=”1448921357186-1727cc9b-52f8″][vc_column_text]
We have expressed interest in an area called the “Dubose Flats”, a natural plateau off Highway 37, between Terrace and Kitimat. The site is about 30 km south of Terrace and 32 km north of Kitimat. So it’s roughly 670 km northwest of Vancouver, as the crow flies. Or about 1,385 km by road from Vancouver.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”What is the timing for construction and start-up?” tab_id=”1448917366571-deb55eb8-4055″][vc_column_text]
We hope to begin construction in the summer of 2019, but the timing depends on the approval processes, and on any conditions our First Nations partners and/or government agencies may require.
If we can begin construction in the summer of 2019, we would plan to begin production in 2023.
Construction would include importing pre-built refinery modules from Asia. These would come in by ship or barges, and be slowly moved by heavy-haul trucks to the site. This technique has been used at many locations in the world. Using such pre-built modules would be far more efficient than trying to build a refinery from scratch a long way from tidewater; in Alberta, for example.
Modules built offshore would be built to specific Canadian standards and we are committed to working with Canadian labour organizations to ensure an integrated approach that maximizes long-term operating jobs, not just short-term construction jobs
[/vc_column_text][/vc_tta_section][vc_tta_section title=”How many jobs will you be creating?” tab_id=”1448918736935-5bd2fbdc-79ca”][vc_column_text]
Our early estimate, based on comparable projects elsewhere, is of a construction workforce of approximately 3,500 positions and an operations workforce of roughly 1,000 full-time positions.
There will also be “spinoffs” such as indirect jobs. But it’s too early in the planning process for us to put any numbers to that.
We expect these numbers to continue to change as we move towards final design and construction plans.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”What is your approach to relations with First Nations?” tab_id=”1448921135046-2dca20c5-ff3f”][vc_column_text]
We know that we must gain free, prior and informed consent from First Nations who hold both rights and title to the land affected by this project.
Engaging with First Nations as a first order of government—with the goal of operating as full partners—is a crucial element of Pacific Future Energy’s plans.
PFEC is in full agreement with the UN Declaration on the Rights of Indigenous Peoples. This is reflected in our commitment to directly engage Indigenous communities, including their families and citizens.
We see this as going far beyond simple consultation; it means engagement and involvement with local First Nations at every step of our project. This requires going beyond simply upholding the current legal requirements. It means establishing meaningful relationships and in some cases, partnerships with the First Nations’ governing bodies and their business and administrative bodies.
We believe in building partnerships based on “co-creation”—building a relationship that allows us to work together, stand together, and develop all stages of the project together, from start to finish.
Partnership can only be developed through respectful and committed relationship building, in which we recognize First Nations’ rights and our responsibilities.
This gives all parties the opportunity to develop meaningful and multi-faceted relationships, not founded on legalistic process but built on shared understandings, and on trust, and on mutual long-term benefits. Such negotiations would eventually be captured in formal understandings.
We believe “social licence” or “permission” must be gained at the concept stage of any project, not when you have already come up with a final plan and blueprints. It must be earned and maintained throughout the lifecycle of the project.
What about consulting the public?
The filing of our Project Description with the provincial and federal regulators marks the beginning of the formal consultation process with the public. Having said that, we are committed to exceeding the minimum requirements set out in the regulatory process.
We have not yet set the first dates, but we will hold public consultations and community meetings in the Terrace-Kitimat region and along the rail route that would serve us.
We are currently looking for a suitable location for a project office, likely in Terrace.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”What kind of bitumen will you bring in? Is it safe?” tab_id=”1448921509056-a7b0584b-a05c”][vc_column_text]
Our feedstock is called “NEATBIT™” and it is the safest variety of bitumen for transport. It is a near-solid that has the consistency of peanut butter and does not flow unless heated (it must be heated to 81°C in order for it to flow easily).
In fact, it is almost completely inert, which is to say it is of low flammability and not explosive. As a result, it is exempt from the rules governments set for transporting anything with an elevated safety risk. It is also non-toxic.
Anything in North America that could have any impact on the environment or on health must be especially labelled if it is shipped in large enough quantities. That even applies to shipping First Aid kits by rail. Our NEATBIT™, though, is exempt from Transport Canada’s Transportation of Dangerous Goods Regulations (Part 1, 1.33), and it can be transported safely by rail car.
On the other hand, you may have heard of “dilbit”. This is the bitumen product that would move through a pipeline. It typically contains 70 per cent bitumen and 30 per cent diluent. Diluent is a thinning agent that makes the bitumen runnier, so it can flow. Diluent consists of one or more lighter petroleum products, typically natural-gas condensates such as naphtha. The problem is, the more diluent you have in it, the more flammable/explosive the bitumen becomes.
“Railbit”, typically carried in railroad tank-cars, is generally about 88 per cent bitumen and 12 per cent diluent. That’s safer than dilbit but still flammable.
The NEATBIT™we propose to use has, by far, the lowest risks of any petroleum product being transported today. It will contain less than two per cent diluent, which is what occurs naturally.
This all means that we do not require a pipeline carrying dilbit.
How does transporting near-solid “NEATBIT™” compare to transporting much more liquid forms of oil, such as in the case of the disaster at Lac Mégantic?
Our trains will be carrying a non-dangerous, near-solid, stable, and essentially inert bitumen. This means that it is non-explosive.
We recognize the concerns that arose from the tragic explosion at Lac-Mégantic on July 6, 2013. The petroleum product that exploded at Lac-Mégantic was totally different from our safe NEATBIT™, though: The Lac-Mégantic oil was a volatile shale oil, highly flammable, and with an unusually high diluent content.
In addition, our bitumen will be carried in much newer, more robust, and safer railcars (TC-117, DOT 117) than the old, general-purpose tank cars (TC-111, DOT 111) that made up the Lac-Mégantic train and are being phased out in Canada.
We also plan to work with Canadian National Railway—the owner of the rail line in the proposed refinery area—to ensure the safest possible operations at all times.
What route will the trains follow?
The incoming trains will travel west along the CN mainline between Edmonton and Prince Rupert, and then come south to our plant down an existing CN freight line between Terrace and Kitimat.
There are no other bitumen trains on these lines right now, but there are fuel trains (carrying gasoline and diesel, for example) that go along the main line to Prince Rupert.
Who produces your NEATBIT™?
Right now, Alberta is focused on dilbit and railbit. But two more companies are planning big plants that can produce NEATBIT™ for transport by rail. With no pipelines on the horizon, we will provide the oilpatch with a new opportunity to export its product, and others will add NEATBIT™ to their focus, too. We’ll be ready to take it, process it, and export the refined products.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”What will make your refinery ‘the greenest’?” tab_id=”1448921785554-a6e29d6f-2d9b”][vc_column_text]
- • The use of a heavy-residue hydrocracking process that eliminates coke production. The elimination of coke production significantly reduces carbon dioxide emissions.
- • Gasoline production without thermal catalytic cracking processes. Thermal catalytic cracking produces some coke.
- • Selection of hydrocracking and hydrotreating technologies that produce EURO V-quality diesel and gasoline. No heavy fuel oil will be produced.
- • Converting carbon residue into fuels. A small portion of the feedstock will remain as pitch; this pitch will be further gasified into a syngas for the production of gasoline, diesel or other liquid such as methanol.
- • Minimize CO2 emission through following means:
- • Use of fuel gas (natural gas) as clean fuel instead of fuel oil;
- • Improving energy efficiency of the processes through design;
- • Integration of multiple units;
- • Using steam generated from various processes for motor drives and power generation; and
- • Using biomass for power generation as carbon neutral fuel.
- • PFEC is also considering capture of CO2 emitted from various sources.
All in all, we’ll be setting a benchmark for refineries.[/vc_column_text][/vc_tta_section][vc_tta_section title=”How will this project impact current pipeline proposals?” tab_id=”1448922455022-b0affbe1-f149″][vc_column_text]
Pacific Future Energy does not have anything to do with any pipeline proposals, and the PFEC refinery will be designed to use non-dangerous, near-solid “neatbit” transported by rail as its feedstock.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”How does the federal government’s proposed extension of the moratorium on oil tanker traffic affect your project?” tab_id=”1448922625401-9ee64f44-d2ef”][vc_column_text]
Protecting our coast and our waters from large bitumen tankers is a core value of our company.
The new federal government has committed to this: “We will formalize the moratorium on crude oil tanker traffic on British Columbia’s North Coast, including the Dixon Entrance, Hecate Strait, and Queen Charlotte Sound, to ensure that ecologically sensitive areas and local economies are protected from the potentially devastating impacts of a spill.”
We agree that protecting our coast from a bitumen spill is of vital importance. That’s why Pacific Future Energy’s refinery will turn bitumen into refined products such as diesel, gasoline, and jet fuel. In the case of a spill, these products would float on top of the water and soon evaporate, and create a much, much smaller problem than a spill of bitumen. Thus the risk of damage to the marine ecology and shoreline would be minimized.[/vc_column_text][/vc_tta_section][vc_tta_section title=”What products will you create?” tab_id=”1456423257789-c5f72656-61cf”][vc_column_text]
We’re looking at 200,000 barrels a day of ultra-low-sulphur fuels: 160,000 barrels a day of diesel, 40,000 barrels a day of gasoline, and 13,000 a day of kerosene (jet fuel). We will also produce 10,000 barrels a day of LPG (liquefied petroleum gas, or propane). Extracted sulphur will be a marketable by-product, as well; we estimate about 1,000 tonnes a day.
Our diesel and gasoline will meet at least “Euro V” standards, which makes them fully approved for all world markets, and above current Canadian standards. Euro V diesel contains less than 10 parts per million of sulphur. The current government standard in Canada and the US is 15 parts per million.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”Burning biomass for power? Is that ‘clean?'” tab_id=”1456423293533-96ce7da7-cba8″][vc_column_text]If we burn biomass to generate some of our power, or natural gas, it will be in a process that minimizes emissions, captures carbon dioxide, and is as clean as we can possibly get using the best technology. Near Zero Net Carbon emissions is where we are going.
How much biomass are you talking about?
That depends on our future balance of power generation (among Hydro, biomass, steam and natural gas). And that balance also depends on conditions at the time. If BC Hydro service were down because of an ice storm, for example, we would have to use more biomass or more natural gas for a while, or a bit more of both. If we use Hydro then there is a proposed hydro line on the site. There is also already a natural-gas pipeline on the site. Down the road, geothermal could be another possible source of energy.
You suggest that using biomass for some of your power needs could somehow reopen closed sawmills. How so?
More than a dozen sawmills in the region have closed in recent years. Skeena Cellulose, the big pulp mill in Prince Rupert, shut down in 2001. One of the key problems for the sawmills, after the closure of Skeena Cellulose, was their inability to get rid of waste wood. We have heard estimates that there could be at least a million tonnes of surplus wood waste in the region. If we can provide a reliable destination for that waste—as biomass for our co-generation plant—it could mean the reopening of some mills that were closed in the last decade, the regeneration of forests, the reduction of carbon dioxide from rotting wood-waste in the forests, and the creation of jobs: a win-win for everyone.[/vc_column_text][/vc_tta_section][vc_tta_section title=”Are you looking for financial assistance from governments?” tab_id=”1456423338440-c9c5338c-0e78″][vc_column_text]No. We are not seeking financial assistance in any form.
What about taxes, fees and other revenues payable to governments?
We cannot give final numbers at this stage in the planning process, and government taxes and revenues may change before we have a plant ready to run. We’re certainly talking about providing millions of dollars in public benefits on an annual basis, though.[/vc_column_text][/vc_tta_section][vc_tta_section title=”Will products be available to Canadian users?” tab_id=”1456423385608-cb0c1261-b1ef”][vc_column_text]
Our refinery’s fuels would be available, and could well be of interest, to Canadian customers. That will depend on market demand. For example, there are some First Nations’ communities that still depend on diesel generators for their electricity, and will for some time. Our diesel will be cleaner (containing less sulphur) than what they can get now.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”What will be the economic benefits of this project?” tab_id=”1456423427586-cf5fd262-df24″][vc_column_text]Let’s start with how Canada is losing an estimated $20 billion a year because its petroleum has only one export customer, the U.S., and therefore gets the lowest price going. We will help address that loss by expanding Canada’s market access abroad. We will be unlocking a trapped resource.
Our refinery will also create thousands of jobs and economic stability at home. Our preliminary estimate is of a construction workforce of approximately 3,500 positions and an operations workforce of roughly 1,000 full-time positions. That’s based on experience elsewhere and does not include the thousands of indirect and spinoff jobs that come with any project of this size.
As well, our project would contribute millions of dollars, directly and indirectly, to local, regional, provincial and national economies. We cannot yet estimate how big a contribution we will make, but it will be significant.
Unlike other refineries in Canada and the U.S., Pacific Future Energy’s refinery will be built to manage all raw inputs and have the flexibility to manage its outputs based on market supply and demand. That will make it viable regardless of the oil market, and without costly refurbishment or upgrading.
The refinery will be constructed using pre-built modules. That means it will be more flexible than any other Canadian or international refinery.[/vc_column_text][/vc_tta_section][vc_tta_section title=”Who is behind this project?” tab_id=”1456423462750-0301cc67-997f”][vc_column_text]We’re a Canadian-controlled corporation. However, the investment of $9 – $11 billion in US dollars is a challenge for Canadian capital markets to fund alone, so we will continue to secure funding from domestic and international partners.
All investment will comply with Canadian laws, including the Investment Canada Act. No federal or provincial financial support is expected or proposed for the Project.
[/vc_column_text][/vc_tta_section][vc_tta_section title=”How is this project economically viable?” tab_id=”1456423496485-46d25e4e-8cff”][vc_column_text]Our project is economically viable indeed. Independent consultants at Deloitte found: “This oil refinery will be profitable. Diesel will be the highlight and it is highly sought after.”
We look ahead to demand for our products: The International Energy Agency expects global demand for energy to increase 37 per cent by 2040, with the biggest demand coming from China and India. Even then, fossil fuels will still provide 75 per cent of global energy demand. The Asian Development Bank predicts that Asia-Pacific nations will increase their energy demand by 67 per cent by 2035. We will help meet that demand.
While the world looks at increasing the role and contribution of renewable energies, petroleum fuels will still play a role for a long time, due to industrial development and economic growth in developing and emerging markets.[/vc_column_text][/vc_tta_section][vc_tta_section title=”How sensitive is the project to the price of oil?” tab_id=”1456423525549-e9b3596f-7bf8″][vc_column_text]The refinery is viable regardless of the state of the oil market and the spot prices for oil that you hear so much about. In fact, many energy companies today are making significant profits from their refineries, even with low oil prices.
Global refining margins may rise and fall owing to various different factors, but a refinery on the Canadian west coast sourcing trapped Canadian oil will remain at an advantage to its global peers.
Are there other global economic factors that could impact your decision to proceed?
This project’s location, including its proximity to Canadian bitumen and interested Asian markets, as well as the decision to build a facility that anticipates changes in supply and demand over the project’s lifespan, will largely insulate us from many of the cyclical ups and downs of the industry.[/vc_column_text][/vc_tta_section][/vc_tta_accordion][vc_empty_space height=”50px”][/vc_column][/vc_row]