Shell Canada aims high in oil sands
Shell Canada has entered the regulatory phase of a massive expansion of its Athabasca oil sands project that holds the promise of keeping an average 3,000 construction workers in jobs over at least the next 10 years.
It heads a consortium that includes Chevron Canada and Marathon Oil (each holding 20 percent) that is aiming to build production from 155,000 barrels per day to 770,000 bpd within two decades.
The application, covering the next 10 years, seeks permission to expand the existing Jackpine mine by 100,000 bpd from previously approved levels to 300,000 bpd and build a new 200,000 bpd mine at Pierre River, north of the Jackpine leases.
Public hearings are expected to start in 2009 and, pending a green light, construction is scheduled for 2010, with production starting in 2012.
C$12.8 billion in construction under way already Currently, Shell Canada has construction worth an estimated C$12.8 billion under way.
No cost forecasts were attached to the latest filings with Alberta regulators, partly because decisions to proceed with each phase will hinge on cost projections, economic conditions, regulatory developments and consultations with communities affected by the developments.
In addition to the mines, Shell Canada has applied for staged construction of a new 400,000 bpd Scotford upgrader complex near Edmonton that could cost C$22 billion-C$27 billion.
The minority Athabasca partners will have the option to export their share of production for upgrading in the United States, where Marathon has already announced plans to expand its Detroit refinery to handle greater volumes of heavy oil.
—Gary Park
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