Sunshine Oilsands sheds light on plans

After 18 months of busily and quietly accumulating 677,000 acres of properties at Alberta government land sales, startup Sunshine Oilsands has unveiled plans to spend an initial C$380 million.

The company, formed in February 2007, has so far invested C$100 million on land acquisition and completing 58 core holes last year. It has an estimated resource of 14.2 billion barrels, divided between Cretaceous sands and Devonian carbonates.

It has earmarked four steam-assisted gravity drainage projects at sites close to Total E&P Canada, Chevron Canada, Athabasca Oil Sands and Grizzly Oil Sands, with a 100 percent working interest in all of its assets except for a 5,120-acre farmout.

The first development involves a 10,000 barrel-per-day project at West Ells, where net pay over more than 10,000 acres is estimated at 40-80 feet.

An application for the first of three phases is expected to be filed late this year.

Sunshine is targeting an average capital cost of C$25,000 per flowing barrel.

Between West Ells and other land holdings at Thickwood there are 32,000 acres that Sunshine believes can support production of 130,000 bpd, the company told a recent oil sands forum. Further delineation through winter drilling is expected to see an application for a 10,000-bpd first-phase project at Thickwood filed late in 2009.

Plans for Sunshine’s carbonate area at Harper include six wells this winter and a possible 6,000-bpd facility, developed in three equal stages.

Financing has been done through private investors and institutions and none owns more than 10 percent. An initial public offering is scheduled for the fourth quarter and partners are being scouted, although the company has said a partner is not essential for work to progress.

—Gary Park