Pipeline spill spoils geothermal project announcement for oil company

CALGARY — A junior oil company is announcing government funding for an environmentally friendly geothermal power project at the same time that it is cleaning up a spill of oil and water from a pipeline in northern Alberta.

Calgary-based Razor Energy Corp. said Thursday it will receive $5 million from Natural Resources Canada’s Clean Growth Program and $2 million from Alberta Innovates to assist in development of a $15-million to $20-million geothermal plant capable of generating three to five megawatts of electricity.

The announcement had been planned for some time and it’s a coincidence the company reported the spill of more than 10,000 litres of oily water on Wednesday to the Alberta Energy Regulator, said CEO Doug Bailey.

The pipeline leak was discovered after a routine aerial inspection found dead vegetation in the right-of-way above the buried pipe, he said, adding it may have been leaking for some time and the total amount spilled isn’t known yet.

“We do flyovers with helicopters and drones for anomalies, for salinity in soil and so on. And for whatever reason, this wasn’t caught,” Bailey said in an interview.

“It’s not linked to this press release at all. This is a press release that we had planned to do before the long weekend sets in so we can get people’s attention.”

Regulator spokesman Shawn Roth said preliminary estimates indicate the spill affected an area of about 2,000 square metres but no impacts to wildlife have been reported.

“The AER is on site assessing the incident and working with the company to ensure all safety and environmental requirements are met as the company cleans up the release,” he said in an email.

Liquids produced from the company’s wells near the town of Swan Hills are 95 to 99 per cent water — the oil is skimmed off the top in an oil battery and the water is pumped back into the underground formation, explained Bailey.

The oil-water mixture is at a near boiling temperature at the wellhead, which makes using its geothermal energy potentially viable, said Lisa Mueller, Razor’s vice-president of new ventures, in an interview.

“You put your hand on the pipe and feel how hot it runs and you realize this heat energy has value,” she said.

“We believe (the project is) technically viable and economically sustainable at this time.”

The company is also planning to build a 15-megawatt natural gas power plant to try to match total generation to its electricity needs at its oilfield, although the power would be sent to the provincial grid and withdrawn as needed.

Razor plans to have the two generators up and running within the next six to 12 months, she said.

Follow @HealingSlowly on Twitter.

Companies in this article: (TSXV: RZE)

Dan Healing, The Canadian Press

Just Posted

Thousands of Albertans flock to Westerner Days on last day

Central Albertans took advantage of Sunday’s sunshine and flocked to Westerner Days… Continue reading

Former Humboldt Broncos player who survived bus crash hopes for spot on team

RED DEER, Alta. — A former Humboldt Broncos player whose back was… Continue reading

Man and dog dead after early morning house fire in Lethbridge

LETHBRIDGE, Alta. — Officials say a man and a dog are dead… Continue reading

Ottawa fights planned class action against RCMP for bullying, intimidation

OTTAWA — The federal government is fighting a proposed class-action lawsuit against… Continue reading

May says Greens will work with any party that has a serious plan for the climate

OTTAWA — With three months until Canadians vote in the next federal… Continue reading

Fashion Fridays: 5 casual summer dress styles

Kim XO, helps to keep you looking good on Fashion Fridays on the Black Press Media Network

A year later, ceremony commemorates victims of the Danforth shooting

TORONTO — The names of the two people killed in a shooting… Continue reading

Relief in sight for southeastern Canada following weekend heat wave

MONTREAL — Relief is in sight for sweltering Canadians after a weekend… Continue reading

Trudeau’s former right-hand adviser playing role in Liberal election campaign

OTTAWA — With three months to go now until the election, the… Continue reading

Hotels face battle over whether to help US house migrants

DETROIT — There’s a new target in the clash over immigration: hotels.… Continue reading

Thousands visit Illinois governor mansion after renovations

SPRINGFIELD, Ill. — Thousands of people have visited the Illinois governor’s mansion… Continue reading

Canadian high school science courses behind on climate change, says UBC study

VANCOUVER — High school students in Canada may not be getting the… Continue reading

‘Us and them’: influence of Quebec anglos on decline with new Coalition government

MONTREAL — Last March, Quebec Premier Francois Legault made a mocking remark… Continue reading

Japanese Canadians call on B.C. to go beyond mere apology for historic racism

VANCOUVER — Japanese Canadians across the country are meeting to discuss how… Continue reading

Most Read