Imperial applies for Cold Lake expansion

17 March 2016, Week 10, Issue 395

Imperial Oil has filed a regulatory application with the Alberta Energy Regulator (AER) for a new in-situ oil sands project on its Cold Lake lease area. The move comes as other oil sands companies are delaying investments in new facilities.

The proposed Cold Lake expansion project will use solvent-assisted, steam-assisted gravity drainage (SA-SAGD) technology to target bitumen in the Grand Rapids formation, the company said in a statement. Imperial’s share in the project before royalties is estimated to amount to 550 million barrels of recoverable contingent resources. The development would cost around C$2 billion (US$1.5 billion).

The company said it had successfully been piloting SA-SAGD technology at its Cold Lake operations since 2010. Based on its pilot results, Imperial estimates that the use of SA-SAGD will lead to a roughly 25% reduction in greenhouse gas (GHG) intensity compared with existing SAGD technology through lower energy input per barrel of bitumen produced. The company anticipates a similar reduction in water use intensity.

If the project goes ahead, it would produce about 50,000 barrels per day of bitumen, which Imperial said would be its share before royalties. If regulatory approvals are processed in a timely manner and business and market conditions are favourable, the company said construction could start in 2019. Production would begin in 2022 according to Imperial’s application.

The existing Cold Lake operation is the largest in-situ project in the world, according to Imperial’s website. The proposed expansion is one of several in-situ oil sands opportunities that the company is currently evaluating. Other potential developments include the Aspen, Corner and Clyden leases in northeast Alberta.

Imperial is also considering the use of solvent technology at its proposed Aspen project. However, no decision has been taken as yet to proceed with the C$7 billion (US$5.4 billion) project, which is anticipated to produce 135,000 bpd.

FirstEnergy Capital analyst Michael Dunn said Imperial was “the most experienced user of solvents in the bitumen recovery process”. To date, however, no major oil sands player has moved from a pilot project to a full-scale commercial development using solvents.

 

Edited by

Anna Kachkova

Editor

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