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UpstreamOnline: Athabasca ‘may produce 1 million bpd’

By Upstream staff

The Athabasca Oil Sands Project could eventually produce 1 million barrels of synthetic crude per day, more than six times today’s nameplate capacity, one partner in the northern Alberta project said today.

“That’s a target number that all three owners have described. We still have to do the necessary technical evaluations on the northern leases to determine if that potential is there,” said Jim Houck, chief executive of Western Oil Sands Inc, which has a 20 percent stake.

“We’re certainly enthusiastic about the possibility of having these expansions and indeed of making the investments,” Houck told reporters after his company’s annual meeting, Reuters reported.

The Athabasca project is 60% owned by Anglo-Dutch supermajor Shell. The other partner is US giant Chevron.

The project, which includes the Muskeg River mine near Fort McMurray, Alberta, and the Scotford upgrader near Edmonton, has a rated capacity of 155,000 bpd, but has at times pumped out more than 200,000 bpd.

In January, Shell detailed plans to boost output to 770,000 barrels pd day with a development at Athabasca called the Pierre River mine. This would be long after the current 100,000 barrel pd day expansion, which could cost up to C$12.8 billion (US$12 billion).

The jump to one million barrels a day would be at least 15 years away, Houck said.

Western is currently scouting the market for ways to boost its value to investors, a process that may result in a takeover, asset sale or deal with a refiner to secure processing for its oil sands-derived crude.

However, Houck declined to say when the process might wrap up or what option Western was leaning toward.

The company’s stock fell C$1.31 to C$35.50 on the Toronto Stock Exchange.

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