Inside a Candu-6: The swimming pool-like facility that is used to cool the radioactive fuel rods. (Canadian Press)

At first blush it seems like a pretty incongruous idea — to plunk a honking big nuclear reactor in the very heart of Alberta's oil patch, to help steam the raw bitumen from the thick tar sands.

But as of this week, there are two serious oilsands players — Husky Energy Inc. and Total SA of France — who are publicly mulling the nuclear option. As well, four others, according to the biggest proponent of the plan, are quietly thinking about it.

Couple that with the thoughts of ex-premier Ralph Klein, whose parting gift was to suggest the nuclear notion had at least to be considered, and you have the makings of a veritable tipping point.

Oil execs are no dummies. They have tough-minded shareholders and inquiring boards of directors to deal with, so they don't just toss out ideas like this willy-nilly. At the same time, the timing of these announcements and their tone (Husky CEO John Lau went out of his way to note the political reticence) have to be taken into account.

The oilsands industry knows it has a monumental PR crisis coming its way: Extracting all this gooey oil from the reluctant earth of northern Alberta is spewing millions of tonnes of greenhouse gases into the atmosphere — gases even the Conservative government in Ottawa is suddenly taking an interest in curbing.

Plus, under current projections, the need for cleaner-burning natural gas to create the steam that is needed to coax the oil from dense underground cavities is expected to increase fourfold over the next decade. By 2025, the Alberta oilsands could be using basically all the natural gas that will flow south from the proposed Mackenzie Valley pipeline, just to get more "dirty" oil out of the ground.

Seen in this light, a clean-burning nuclear reactor, which won't contribute to global warming and which will replace at least some of the steam needed for oilsands extraction, can look like a pretty shrewd option.

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The problem, though, is that reactors are often more costly than they first appear, plus they take an awfully long lead time to get through all the regulatory hurdles and come on stream, raising the question: Is all this talk of nuclear just a smokescreen to keep the politicians at bay?

A real plan

A nuclear option of one sort or another has been floating around the oil patch for at least a decade. But this time it's a bit different, there is a real plan on the table.

Two Calgary-based entrepreneurs, Wayne Henuset and Hank Swartout formed Energy Alberta Corp. and teamed up with Atomic Energy of Canada Ltd. to promote the Candu-6 as the answer to the vast energy needs of the oilsands.

Henuset, the president of the company, said in an interview the group is building the project around two Candu-6 reactors, which would produce a total of 1,400 megawatts of power and which would be built together smack in the middle of oilsands country, just south of Fort McMurray.

The projected capital cost is roughly $4.5 billion and the reason for the centralized location is that one of the biggest needs of oilsands extractors is high-pressure steam, and steam from a central plant such as this only has an effective range of about 24 kilometres when delivered through pipelines.

The Candu-6 is a full-scale 700-megawatt reactor that has been around since the early 1980s. It is the one Canada has exported to China, Korea and Romania, and the same one that is found at Point Lepreau, N.B., and most of the sites in Ontario, including the Darlington, Pickering and Bruce plants.

AECL would build and operate the plant, while Energy Alberta and private equity groups would own it. There is no plan to have any government equity in the project, says Henuset.

In fact, he doesn't even anticipate it going on the province's electricity grid: This will be a dedicated project for designated users who will want either (or some combination of) the steam, electricity, hot water or hydrogen that the reactors can supply.

"The variables are almost unlimited," says Henuset. "Each individual company has different requirements," which is adding to the complexity of the project and even a final decision on where it would be actually sited, he added.

In its sales pitch, Energy Alberta says that its nuclear project could support up to 150,000 barrels a day of tarsands production and would displace up to .26 billion cubic feet a day of natural gas. That sounds like a lot, but it only represents about six per cent of the natural gas that current projections say will be needed by 2025.

Pros and cons

The obvious benefits, of course, of putting a Candu into the oil patch are that nuclear energy doesn't contribute excessively to global warming and that it will free up cleaner-burning natural gas for more appropriate use. It would also be a big shot in the arm for AECL and its attempt to sell more Candus abroad or even in Ontario, which is also considering adding more nuclear power.

Less obvious, a Candu would bring more economic activity and high-paying technical jobs to an often-overlooked part of the country. And, depending on the companies involved, it might also increase provincial royalties as they go up when productions costs go down.

On the downside, timing will be a problem. Energy Alberta would like to see regulatory hearings begin in just over a year from now and the entire plant to be completed by 2016. That's probably overly optimistic, but even so it represents a long delay in getting a start at curbing greenhouse gas emissions, and those companies that opt for the nuclear option might find themselves having to play environmental catch-up with their competitors.

Water is also going to be a big issue here. Already, prominent scientists like the University of Alberta's David Schindler are warning that Alberta's water table has been seriously depleted — some major river systems are down almost a third since the 1970s — and that there will not be enough readily available water for all the future oilsands projects.

Henuset argues that reactors are really just like giant radiators — they heat water but then return most of it to nearby lakes or rivers to cool. Still, this one will be part of a process that effectively ships water from one particular reservoir, where the reactor is situated, to a mine site where it will ultimately end up in a toxic waste pond.

Cost

Henuset's cost estimates for the project seem reasonable. But, just on the face of it, it's hard to see how this will be much of a bargain for extractors, unless they are factoring in huge premiums for future natural gas, environmental mitigation or the right to sell their products in so-called clean markets like the one California is proposing.

Ontario regulators in 2005 pegged the cost of a new Candu-6 at $2,845 a kilowatt, which would make the 1,400 MW unit being proposed for Alberta run about $3.9 billion, not counting the pipeline grid.

The cost of a reactor is normally amortized over an expected 35-year lifetime and at an efficiency rate of 85 per cent, which is not usually achieved, at least in Canada. The one at Lepreau and several in Ontario required very expensive repairs at around 20 or so years, which made the real cost of their output much higher. N.B.'s public utilities board recommended against buying another reactor.

If oilsands operators can find a ready export market for northern Alberta nuclear power then just taking the steam by-product could make this project quite doable. But that is not what they are doing. This is going to be a totally off-grid project, says Henuset. The cost will be shared among those who sign on.

If that's the case, then the electricity costs in particular from this project will likely be higher than the norm for northern Alberta, a region that is already basking in a considerable amount of oversupply. Judging by the cost figures Ontario and New Brunswick regulators have come up with (between 9 and 13.5 cents a kilowatt hour for nuclear if normal rates of return are factored in), this ain't such a bargain.

What's more, if the oil boom — or even the oil age — does come to an end within the next half century, then somewhere in northern Alberta there is going to be an awfully expensive nuclear reactor just sitting around spinning its atoms.

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LETTERS:

It is puzzling when a seasoned writer such as Robert Sheppard seems to perpetuate the myth that a nuclear reactor is "clean-burning" and will not "contribute to global warming". This myth has been debunked by many and by no less than the Pembina Institute. SEE: http://www.pembina.org/pubs/pub.php?id=1348

—Jim Penna | Saskatoon, Sask.

A few points to ponder:

1) The figures per kilowatt/hour quoted in the article are for situations where electricity is the primary product of the reactor system and the heat is waste. This is the inverse of an oilsands scenario, making the "waste" electricity available at a substantially discounted rate from these quoted figures.

2) The nuclear option may allow higher extraction temperatures than are monetarially or envrionmentally affordable with natural gas based steam. This could potentially improve overall extraction efficiencies of the tar-sands when viewed as a system.

3) The excess electricity could be used to generate hydrogen, generally used to upgrade the oil. If there was more hydrogen than the upgraders needed, it could be sold. Doesn't this sound a bit like the beginning of a "made in Alberta" hydrogen economy?

4) If humans were to create a gooey mess like the tar sands, or a nuclear mess like the uraniaum deposits in Northern Saskatchewan, it would be called a disaster and the "creators" would go to jail. As they exist, these messes are natural places to bury the nuclear waste that will be created....far away from cities, terrorists, and safely under tons of overburden that was already removed.

5) "Waste" heat and electricity from the nuclear reactor could be used in new and creative ways to treat waste water, and either re-use it or return it to the envrionment in a better state than we took it.

Nuclear energy for the tar sands is not a case of if it should happen, but when!

—Pat Landymore | Calgary

After reading this terrifying article one feels that it is inconceivable to actually build a nuclear reactor for the exclusive purpose of powering the removal of the very substance that is known to be bringing about the ruin of our civilization.

What is truly inconceivable is that citizens are not collectively taking action to stop the powers behind this doomed development project-the small group of faceless elite who are able to privately invest 4.5 billion dollars in a nuclear plant just to get at the dirty oil that pollutes the planet and is bringing on the fury of climate change.

For Energy Alberta Corp. and those invested in the tar sands, their money is their power and their power buys impunity. That big money condemns us all.

With alternative green energy sources ready and available for the transitioning of society away from the over-consumption of fatal energy like petroleum, it is high time that people learn to come together and collectively stop big business from controlling our fate. Our current focus on energy sources and fuel power too often falls short of talking about the real issue of economic power-who is really benefiting from these destructive actions and why do they get away with it?

If the government will not stop business from acting against the basic needs of the broad public, it means we must get together and use our power in numbers to force government and big business to change. The full critical mass of civil society needs to participate in redirecting power to the public good.

—A. Larsen | Montreal

Interesting piece, but where will the nuclear wastes of the new plant go?

A nuclear plant might produce less green house gases, but it does produce radio-active wastes. Doesn't that count in its ecological footprint?

—Christian Collet | Montreal

No doubt, there would be a strategic alignment of Saskatchewan uranium with the Alberta nuclear reactor as Gerald Piwowar argues bellow.

But we all know you can't make steam without water and the Athabasca River (the only source available to the oils sands), is insufficient to meet the needs thanks to the impact of global warming brought on by the very industry seeking to expand.

Round and round we go, down and down we ...

—Allan Mcrae | Kamloops

As Canadians we should be horrified that nuclear power is being considered to replace fossil fuels. We have 30 years of nuclear waste in storage pools in Ontario with no plan and no money to permanently dispose of it. We have billions in reactor construction debt that I will be paying off for the rest of my life.

Nuclear plants are not insurable, the public picks up all the risk, and that is not a risk I am willing to pay for through my taxes when conservation and renewables are not supported in the same way.

Let's face the music, any enegry source that is not sustainable, has no future. We must only consider energy solutions that are sustainable on the hundred year level, and that do not leave a legacy of waste, risk and cost for future generations.

Albertans have an option to recognize the fossil fuel era is coming to an end, and they can use present enormous oil and gas revenues to build a sustainable economy that would be the envy of the rest of Canada.

—Steve Lapp | Kingston, Ont.

Nuclear energy is not green. Nuclear waste is more toxic to human life on Earth than any other known pollutant, including the green-house gases it seems to prevent.

The land on which a nuclear site is built and the land around it can be used usefully for about half a century and then it must be shut down, never to be used again. Most of the water that a nuclear plant uses becomes water that must be contained for ever but can never be used again.

As it is, the sustainable population of Earth is at least about one quarter of the 2007 population. However, if every country on Earth had one nuclear power plant, we, the Earthlings, will have to reduce our population to one tenth of what it is in 2007 in order to have the land and water to allow human civilisation to continue sustainably.

Humanity as a species and North America as a continent must stop reaching for the nuclear solution before we dissolves the future of our civilisation without the help of any other technology.

What we need more than we need more nuclear energy is more green-house gas and more climate change. Better still, let's just grow up and act like adults! Our population does not need more toys to play with. We need safer long-term playgrounds run by fewer intellectually-bankrupt bullies and idiots.

—Bob Halstead | Toronto

Most of the natural gas consumed at the oilsand upgraders is used to create hydrogen. My understanding is that the steam, and most of the electricity, is produced from burning off-gases from the various upgrading processes.

Nuclear power generators therefore must provide hydrogen to offset the lion's share of the gas consumption. And this ain't easy!

—Scott Lane | Fort McMurray, Alta.

It doesn't make sense to me to put a reactor right in the middle of one of the world's largest deposits of Oil. Should something go terribly wrong and there be an accident, or even a deliberate act of terrorism, we would contaminate all the potential oil in the that huge reserve,leaving us with nothing. With Nuclear power it seams that no-one is responsible should something go wrong. Please read this:http://www.ccnr.org/insurance.html

If Nuclear energy still sounds good then please be listed as one of the ones who is willing to take the responsibility should something go wrong. For an industry that has been around for 40 years in many countries, I find it irresponsible for no-one yet to have figured out how to dispose of the highly contaminated and poisonous waste, or to limit the impact of an accident. We are not responsible enough to deal with Nuclear issues.

—Malcolm Tuer | Toronto

Very interesting article. However, it wasn't clear to me why the reactor wouldn't be on the grid. Given the proximity to Fort McMurray, this would seem to be relatively simple, and would lessen Alberta's reliance on coal-generated electricity.

—Reynald Hoskinson | Vancouver

I was very happy to learn that nuclear energy was being considered for the Oil Sands but concerned about the water supply.

Also what was not mentioned is the Heavy Water that will be needed as a reactor coolant. Do we have under productive Heavy Water plants? Will Heavy Water plants have to be built? If yes, where?

—Neville Quelch | Toronto

An important part of the story that wasn't even touched on is that Saskatchewan has one of the largest natural deposits of uranium ore in the world and that oilsands development is headed toward the Albert-Saskatchewan border and into Saskatchewan.

The real point is the strategic geological placement of huge oilsands reserves right next to huge uranium reserves.

—Gerald Piwowar | Saskatoon, Sask.

Good piece, except for maybe the bit at the end: if the oil age passes into history 50 years hence, then given the accumulated population growth and the need for electrical energy as oil's replacement, chances are nuclear power plants will be spinning their atoms madly to keep up with the demand, regardless of where they happen to be located.

—Jason McKen | Fort McMurray, Alta.