Most of Alberta's petroleum resources are heavy oil and bitumen. Further reduction in the cost of upgrading is the key to its development, as upgrading represents approximately 50% of the total cost of producing SCO from new oilsands projects.

Upgrading can be achieved by different schemes, each of which offers trade-off between product yield, product quality, capital cost, and operating costs. Generally in Alberta the high conversion hydro-cracking schemes offer better economics. This is mostly due to their higher yields and better product qualities more than offsetting their higher capital and operating costs. To further reduce the cost of upgrading, improvement in the economics of these high conversion hydro-cracking processes is required. This can be accomplished by further optimizing the primaryconversion step.

This paper discusses the development of the (HC)3 Process. (HC)3 is a high conversion hydro-cracking process with integrated hydro-treating that has been developed by Alberta Energy - Oil Sands and Research Division. The (HC)3 Process has been developed and demonstrated to achieve conversion in excess of 95% at moderate pressures and relatively high temperature in a very cost effective manner. This has been achieved with the aid of a colloidal catalyst, that selectively converts the asphaltenes, and a proprietary recycle methodology that significantly reduces the catalyst consumption.

Cost and economic studies indicate that capital and operating costs of the (HC)3 upgrading scheme are lower than those of other high conversion schemes and are comparable to those of low and moderate conversion upgrading schemes. This cost advantage combined with the high yield gives the (HC)3 a significant economic advantage over other upgrading schemes.

The (HC)3 process shows great promise at achieving high conversion efficiently and economically. The process is ready for commercial testing. Discussions are underway with regards to testing the process in a commercial facility designed to process nominally 5000 barrels per day (BPD).


Most of Alberta's petroleum resources are heavy oil and bitumen. The development of these resources has the potential of playing a major role in supplying future North American energy demands. However, for these resources to e competitively exploited the cost associated with producing synthetic crude oil (SCO) from these resources should be less than, or equal to, that of the conventional crude oil they Can potentially displace. To date, improvement in production and upgrading technologies has resulted in significant reduction in the cost of producing SCO. However, this cost for new grass roots facilities is still greater than that of conventional crude oil. There is therefore a need for an improvement in technologies which will enable further reductions in the cost of producing SCO. Upgrading is the key area, as it currently represents approximately 50% of the total cost of producing SCO from new oil sands projects.

Upgrading, which is unique to Alberta, involves processing whole bitumen or heavy oil to produce SCO feedstock for refineries. Currently upgrading is achieved by either coking followed by separate hydro-treating (as practiced at Suncor and Syncrude) or low conversion hydrocracking and coking followed by separate hydro-treating (as practiced at Syncrude, Nugrade, and Bi-Provincial Upgrader).

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