Shell Canada withdraws oilsands mine application as a cost-cutting measure

By Dan Healing of the Calgary Herald

Extracts

The Pierre River oilsands mine proposed by Shell Canada in 2007, split out of a joint application in 2009 and delayed indefinitely last year has been withdrawn entirely from the regulatory approval process.

“The Pierre River mine remains a very long-term opportunity for us but it’s not currently a priority,” said Lorraine Mitchelmore, president of Calgary-based Shell Canada, in a news release on Monday.

“Our current focus is on making our heavy oil business as economically and environmentally competitive as possible. We will continue to hold the leases and can reapply in the future when the time is right.”

Shell said it has existing regulatory approval and scope to potentially more than double its current 255,000 bpd oilsands production without the northern Alberta Pierre River mine.

Spokesman Jeff Mann said the decision was not made as a cost-cutting measure.

FULL ARTICLE

Shell pulls plug on long-delayed oil sands mine 

JEFF LEWIS: CALGARY — The Globe and Mail: Published Monday, Feb. 23 2015, 1:24 PM EST

Royal Dutch Shell PLC has scrapped plans for a long-delayed oil sands mine, pulling the plug as oil prices skid to multi-year lows.

The European oil major said Monday that it is withdrawing its application with federal regulators for its 200,000 barrel-a-day Pierre River mine north of Fort McMurray, calling the project a “very long-term opportunity” that is not currently a priority.

The collapse in crude prices has prompted layoffs and deep spending cuts across the industry, hitting profits at large companies such as Suncor Energy Inc. and Cenovus Energy Inc.

Shell in January cut as many as 300 jobs at its Albian Sands bitumen project as part of efforts to improve the project’s economics. Shell holds 60 per cent of that project with Chevron Corp. and Marathon Oil Corp., who each hold a 20-per-cent stake.

FULL ARTICLE

FROM A RELATED PRESS RELEASE MADE ON BEHALF OF SHELL

CALGARY, Feb. 23, 2015 /CNW/ – Shell announced today it is withdrawing its regulatory application for the proposed Pierre River Mine north of Fort McMurray, Alberta to focus attention on its existing oil sands operations.

“The Pierre River Mine (PRM) remains a very long term opportunity for us but it’s not currently a priority,” said Lorraine Mitchelmore, Shell Canada President and Executive Vice President of Heavy Oil. “Our current focus is on making our heavy oil business as economically and environmentally competitive as possible. We will continue to hold the leases and can reapply in the future when the time is right.”

Shell has existing regulatory approval and scope to potentially more than double its oil sands production from its current level of 255,000 bpd.

Given the preliminary nature of the Pierre River Mine project, employment impacts will be very limited.

NOTES TO EDITORS

Pierre River Mine background:

• The Pierre River Mine (PRM) application outlined a proposal for a new 200,000 barrel-per-day (bpd) heavy oil mine north of Fort McMurray, Alberta.
• Shell originally submitted a joint application for PRM and the Jackpine Mine Expansion (JPME), a 100,000 bpd expansion to the Jackpine Mine, to the federal regulator in 2007 on behalf of the Athabasca Oil Sands Project (AOSP). The AOSP is a joint venture operated by Shell and owned among Shell Canada Energy (60%), Chevron Canada Corporation (20%) and Marathon Oil Sands LP (20%).
• Shell separated the PRM and JPME applications in 2009.
• A regulatory hearing on JPME took place in 2012. The Joint Review Panel for JPME issued its Decision Report in July 2013, recommending it for approval. CEAA issued its Decision Statement in December 2013 deeming the project to be in the public’s interest.
• In February 2014, Shell informed the joint-review panel for PRM that it would update the development timeline for PRM.

Shell Canada Ltd
Shell has been operating in Canada since 1911 and employs approximately 8,000 people across the country. A leading manufacturer, distributor and marketer of refined petroleum products, Shell produces natural gas, natural gas liquids and bitumen, and is Canada’s largest producer of sulphur. Shell is one of Canada’s oil sands developers and operates the Athabasca Oil Sands Project on behalf of the joint venture partners.

For further information: Shell Canada Media Relations +1 877 850 5023 or [email protected]; Shell US Media Relations +1 713 241 4544; Shell International Media Relations +44 20 7934 5550

SOURCE PRESS RELEASE

RELATED ARTICLES

Shell shelves 200,000-bpd Pierre River oil sands mining project: Reuters 23 Feb 2015

Shell Withdraws Pierre River Oil-Sands Regulatory Application: Bloomberg.com

Shell shelves plan for tar sands project in face of low oil prices: The Guardian

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