Imperial Oil green-lights $2 billion Cold Lake expansion
Imperial Oil is spending $2 billion to expand its Cold Lake insitu oilsands operation in northeastern Alberta.
The oil giant said Friday that the Nabiye expansion project will add more than 40,000 barrels a day and access 280 million barrels of recoverable reserves. It is expected to startup by the end of 2014.
Cold Lake is the largest thermal in-situ heavy oil operation in the world at 160,000 barrels of oil per day. Oil located 400 metres below the ground is injected with steam to thin the heavy bitumen and enable it to flow to surface. The process is also known as steam-assisted gravity drainage (SAGD).
Imperial said the expansion will include development of a new steam generation and bitumen-processing plant, field production pads and associated facilities. Regulatory approvals for the project were granted in 2004. A planned 170-megawatt cogeneration facility is expected to improve the plant's energy efficiency.
The Cold Lake expansion is part of increasing efforts to grow production at Canada's oilsands, which represent the world's third largest crude reserves and the largest source of US oil imports. Other examples:
- In January Teck Resources made a $434 million acquisition of SilverBirch Energy designed to advance the early-stage Frontier oilsands project.
- Hearings are currently ongoing into the Northern Gateway pipeline proposed by Enbridge that would transport oilsands crude from northern Alberta fields to the BC port of Kitimat for export to Asia.
- The Keystone XL pipeline that would move oilsands from Alberta to Texas refineries was recently kyboshed by the US government but the door was left open for the proponent, Calgary-based TransCanada Corp, to re-submit an application that diverts the pipeline around a sensitive aquifer in Nebraska.
Friday's announcement by Imperial comes on the same day that the Alberta and Canadian governments are expected to release a long-awaited plan to track the environmental impacts of oilsands development, the pace of which has attracted high-profile opposition both in Canada and the United States.
The Conservative Party-led Canadian government has also said, however, that it is working to speed regulatory reviews of new industrial projects including those in the oilsands.