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Giant oil sands project clears regulatory hurdle Final OK needed from feds, Canadian Natural for 232,000 b/d operation Gary Park Petroleum News Calgary correspondent
Regulators have given a green light to the largest single oil sands application to come before them — a C$8.5 billion integrated operation by Canadian Natural Resources that could produce 232,000 barrels per day by 2012.
Although the existing Syncrude Canada and Suncor Energy projects have greater output, with plans for further expansion, they reached their current levels with staged additions.
Canadian Natural submitted its entire proposal for an oil sands mine, bitumen extraction plant, upgrader and associated facilities in a bundled package, although it has scheduled a phased-development, starting at 113,400 bpd in 2008.
The approval, following extensive public hearings last year, was issued Jan. 27 by Alberta’s Energy and Utilities Board and the Canadian Environmental Assessment Agency. Federal cabinet, board approval still needed However, Steve Laut, Canadian Natural’s chief operating officer, cautioned that two hurdles remain — approval from the federal cabinet and the company’s board of directors, which expects to make its decision this summer.
If Canadian Natural proceeds, it will join the big league of oil sands producers, comprising Syncrude, Suncor and Shell Canada, and put Canada on the road to combined output of 1.9 million bpd within a decade.
The two agencies said the Horizon project was “unlikely to result in significant adverse environmental effects provided that the mitigation measures ... are implemented.”
Last year’s hearings faced harsh claims of environmental and health problems if Horizon proceeded.
David Schindler, an environmental scientist from the University of Alberta, said the physical impact on the land and water would be similar to a hydrogen bomb, should development go unchecked for the next 20 years.
The Sierra Club of Canada estimated Horizon would boost Canada’s greenhouse gas emissions by 1 percent, and accused Canadian Natural of failing to include climate change into its planning.
Deer Creek Energy, a Calgary-based junior company that owns an oil sands lease directly south of Horizon, told the hearing that Horizon would use substantial volumes of water, with an adverse impact on its planned commercial operation.
David Holgate, an attorney for Canadian Natural, assured the regulators the company would undertake reclamation work to create lakes and wildlife habitat that don’t currently exist.
He said there was little hard scientific evidence to support those who worry about the impact on the water threshold of the Athabasca River, the major waterway in the region.
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