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Husky adding bite to its bark
Backed by a C$2 billion profit from 2005, Husky Energy is more eager than ever to pursue its path to mega-projects.
Although troubled by a 19 percent rise over the past year in unit operating costs in the Western Canada Sedimentary basin, the smallest of Canada’s fully integrated oil companies is committed to a “long-term strategy” to develop its high-end projects, said Chief Executive Officer John Lau.
Beyond that Lau was vague about the plans, but Husky’s focus is clearly on offshore Newfoundland and the Alberta oil sands, with an outside hope in the Northwest Territories.
Having brought Newfoundland’s White Rose oil field into production ahead of schedule and on budget, the company is targeting 100,000 barrels per day over the next six months.
It has also been awarded exploration rights to two parcels in the Jeanne d’Arc basin with a work commitment of C$36 million and has budgeted C$350 million for the region this year. 951 million barrels of bitumen Its oil sands ventures include the introduction by mid-2006 of the Tucker project, which is aiming for peak output of 30,000-35,000 bpd — a warm-up for its much grander C$10 billion Sunrise project, which has regulatory approval for 200,000 bpd, starting at 50,000 bpd in 2009.
Bolstering Sunrise are Husky’s updated numbers on bitumen reserves, which were raised in January to 951 million barrels of proved plus probable from 79 million barrels a year ago, partly due to U.S. accounting rules which require companies to estimate reserves using prices in effect on Dec. 31 of any year.
Of the new total, 850 million barrels are credited to Sunrise.
In the Northwest Territories, Husky has spudded two wells after notching the first hydrocarbon discovery in 85 years in the Central Mackenzie Valley.
Stewart D-57 is targeting a depth of 10,200 feet and will evaluate multiple zones, while Summit Creek K-44 will appraise last year’s discovery in the Summit Creek B-44 well, which unlocked several productive intervals in a 60-foot hydrocarbon-bearing column and tested at combined rates of 20 million cubic feet per day of gas and 6,000 bpd of oil and condensate.
—Gary Park
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