Monday, July 30, 2012

Southern part of Keystone XL approved

Map from
The last "key approval" for the section of TransCanada's Keystone XL pipeline was received last week. The section runs from the oil hub at Cushing, Oklahoma to Nederland, Texas on the gulf coast. 

This 400 mile part of the pipeline is apparently now called "the Gulf Coast Project". It's projected to cost $2.3 billion and create 4,000 jobs, it's not clear how many of those would be permanent.  This press release has a breakdown of jobs expected to be created.

Monday, July 23, 2012

CNOOC to buy Nexen for $15 billion

In what's a pretty big surprise to me, CNOOC is in the process of buying Nexen for $15.1 billion, or at least trying to. Another article on this is hereNexen is now apparently only the 12th largest Canadian oil company, producing 213,000 BOE's per day. The offer is for $27.50 per share, a significant premium on the price of $17.06 last Friday. 

Obviously this is a huge event for the Canadian oil industry - Nexen is one of only a handful of mid-sized Canadian oil companies operating overseas. As far as oil sands go it is less important - Nexen's Long Lake project has been something of a disappointment since the get go and its 7.23% interest in Syncrude isn't particularly big. However, at 48,000 barrels per day of oil sands production, Nexen is not an insignificant player. This article illustrates how this acquisition will more than double China's oil sands production from 33,000 barrels per day to about 81,000 barrels per day, or about 5% of the total.

Thursday, July 12, 2012

Imperial plans Aspen, a SAGD project near Kearl

Imperial announced its intentions to develop a new SAGD project in the Aspen area south of Kearl. It's not going to be until beyond 2020, however, and will "probably" involve two 40,000 barrel per day phases.

Shell gets conditional approval for carbon capture scheme

The Scotford upgrader.
Picture from Natural Resources Canada. That's right,
I'm stealing pictures from the government now.
Shell has been given conditional approval from the ERCB to capture carbon dioxide from its Scotford upgrader near Edmonton. That's a first for the industry. The project is planned to cost $1.35 billion dollars and capture 1.2 million tonnes of CO2 per year. That apparently includes $745 million over 15 years from the Alberta government and $120 million from the federal clean energy fund. The rest of the cost will presumably be split between Shell and its Scotford partners - Chevron and Marathon, each with 20% stakes.

Wednesday, July 11, 2012

Liberals seek middle ground on oil sands

Rae during obligatory helicopter tour. Picture from
National Post article.
Bob Rae, the leader of the federal Liberals, has recently visited Fort McMurray and said that Canadians need to better understand how important oil sands development is to the country,  but that that development needs to be properly regulated by both federal and provincial governments.

He has also weighed in on the Highway 63 issue, saying that federal money should be available to help twin the road. 

Company shuns pipelines, ships bitumen by rail

Back in Thomas's day, oil was
transported by pipeline.
Southern Pacific, a small oil sands company, expecting to start production this year, is planning to ship its produced bitumen by rail.

Their first production, from a SAGD property called STP-McKay, is expected to begin this year with a planned first phase capacity of 12,000 barrels per day. Bitumen will be trucked from the site 45 km north of Fort McMurray to the CN rail terminal at Lynton, south of Fort McMurray. There it will be put in train cars and sent 4,500 km to Natchez, Mississippi. There it will be put on barges and sent down the Mississippi to gulf coast refineries.

Tuesday, July 10, 2012

Indian consortium to make bid on ConocoPhillips assets

ONGC, Oil India and India Oil have joined together to buy a stake in ConocoPhillips' oil sands assets. The three are state owned corporations. The assets are said to be worth $5 billion, but it's not clear they're going to be buying all of them.

The article says that six assets are involved but doesn't list them, although earlier articles said they were Surmont, Thornbury, Clyden, Saleski, Crow Lake and McMillan Lake. Only Surmont is producing, at 25,000 barrels per day according to this article and since my free Oil Sand Review membership expired I can't be bothered to check that. It says some estimates put future potential production from all six properties at 500,000 barrels per day. That sounds pretty optimistic to me.