Aiming low in the oil sands

As it embarks on commercial development, Petrobank Energy and Resources has put a price tag of about C$100 million on the initial 10,000-15,000 barrel-per-day phase of its May River oil sands project in Alberta.

That translates into capital costs of about C$15,000 per flowing barrel, a mere fraction of the outlay by other operators.

And it hopes to repeat that average as it moves to full production of 100,000 bpd in the four or five years after Phase 1 startup in late 2009.

The budget numbers will be firmed up once it files an integrated application for Phase 1 about mid-2008 and as it proceeds with a “rolling development” that will be tied to regulatory and environmental approvals.

—Gary Park