Israel’s ORMAT Industries Ltd (NASDAQ:ORA) has joined with its subsidiary Opti Canada Inc (TSE:OPC) in a project in extract and produce a high grade of petroleum from oil sands located in northern Alberta Canada. ORMAT is a world leader in producing energy from unconventional sources, including geo-thermal energy from volcanoes and hot springs under the earth’s surface.
The company that likes to brand itself as a clean technology company the world over is not so quick to reveal that it is involved in what could be the dirtiest deal ever for the planet:
The northern-Alberta tar sands venture involves Ormat’s technology to use high pressure steam to extract the crude oil, presently trapped in the sands located deep below the earth’s surface. The process is known as steam assisted gravity drainage, or SAGD for short. It’s a dirty process, and some environmentalists say it will make current levels of greenhouse gases look meagre compared to what gets released during tar sands processing.
OPTI Canada Inc. is a subsidiary of the ORMAT Group of Companies. In business since 1965, Ormat has been a supplier of ultra reliable power units for the oil and gas industry, and has built renewable energy power plants producing 700 megawatts of electricity, in over 60 countries around the world.
The new venture in Canada hopes to produce a very high grade of premium “sweet crude oil” which has a low sulfur content and will be much easier for refineries to work with. But it is filthy in other ways. According to a 2008 Grist report from Environment Defense Canada:
The main reason is that extracting the oil from the sand is so energy intensive, from the large machines to the natural gas used to melt the bitumen out of the sand. It is estimated that by 2012 the Tar Sands will use as much gas as is needed to heat all the homes in Canada … Using huge amounts of relatively clean burning natural gas in order to produce dirty and carbon heavy oil is what commentators have dubbed “reverse alchemy” — the equivalent of turning gold into lead.
Ormat is known for its recovered energy processes, which creates energy by utilizing exhaust gas from compressor stations along interstate pipelines, midstream gas processing facilities and other energy-intensive processing industries such as cement production.
While the “sweet crude oil” venture seems like a good deal for those still interested in finding new sources of crude oil, including the Chinese, who are interested in investing in the tar sands project, at the end of the day, all that is really being done is merely extending the use of petroleum as a major energy fuel source with all its environmental implications.
The Ormat Group itself has already shown that it can produce viable energy output from a number of ecological friendly source, that also includes their ORMAT Energy Converter that uses an organic “motive fluid” that operates on a principle known as the Organic Rankine Cycle (ORC).
With all this in mind, innovative energy companies like Ormat might better devote their R&D efforts into more environmentally friendly energy projects, instead of ones which will merely extend the use of “Texas tea” as a world power supplier. Or come clean with their shareholders and advertise the fact that they are driving in part, what could be the most destructive project to date on our planet.
More on Ormat from our archives:
(Photo via Opti Canada Inc.)
Karin Kloosterman contributed to this report.
Reader Michael Wittig responds to this Green Prophet article in his own Green Prophet post: “Oil Sands Are Trying To Clean Up Dirty Business.”