Petro-Canada puts oil sands pieces in place
Petro-Canada is hot on the trail of achieving more than 200,000 barrels per day of oil sands output within the next decade.
It closed a deal June 27 with UTS Energy to cover 90 percent of the C$1 billion first phase of the Fort Hills project and is primed to make two key decisions later this year one to build a separate upgrader to handle bitumen from Fort Hills and one to choose a site for a second steam-assisted gravity drainage project.
Brant Sangster, senior vice president of oil sands, told a New York investment conference June 29 that Petro-Canada is narrowing down its selection of the size, timing, technology and location of the upgrader.
It is also pondering whether to raise the initial output from Fort Hills above the targeted 50,000 bpd. Having invested C$300 million earlier this year to obtain a 60 percent share of the project, Petro-Canada has indicated it expects to participate in a project that could grow to 190,000 bpd and cost up to C$5 billion.
Fort Hills comprises a 45,000-acre lease holding an estimated 4.7 billion barrels of bitumen, of which 2.8 billion barrels are recoverable through mining.
On the second steam-assisted project, Sangster said Petro-Canada believes it has a sufficient potential in several leases to produce 30,000-40,000 bpd.
The company has also spent C$1.2 billion on equipment and anticipates investing another C$1.4 billion to convert its Edmonton refinery to become a totally oil sands-based facility.
Currently the refinery runs 50,000 bpd from the Syncrude Canada oil sands consortium and 85,000 bpd of conventional light crude.
Gary Park
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